Business insurance is critical for your business’s continuity. Having the right insurance can help in protecting your business, customers and income at any given time. This Legal Kitz blog is about all things business insurance.
Importance of business insurance
Having business insurance can be valuable when it comes to situations where you are taken to court and asked to pay for damages, and can help in the prevention of business interruption and loss of property. Without correct business insurance, your business can face significant consequences where you may have to pay a large sum of money or even close your business.
Types of business insurance:
Some compulsory business insurances include:
- Workers’ compensation: If you have employees, this insurance is compulsory for your business. This covers your employees if and when they are injured in an accident during work, or become sick due to their work. This compensation includes payments to employees that can cover wages whilst they are not fit for work and ensures they receive respective medical expenses and rehabilitation. Contractors and subcontractors are usually considered as workers when engaging in activities on behalf of a business.
- Product and public liability: This insurance covers potential liabilities to third parties relating to personal injury or damage to property. The product liability covers injuries and damages caused by any product distributed, supplied or manufactured by your business. On the other hand, public liability relates to injury or property damage whilst being on the job.
- Third party personal injury insurance: Most businesses own vehicles that support their day-to-day operations. To cover any losses and damages due to accidents, thefts or natural disasters for example, a vehicle insurance in this case is beneficial. It should also include protection against potential lawsuits and injuries to drivers.
- Industry-specific insurance: Your business may need other compulsory insurance depending on the industry and sector you work in. Please note that rules vary between states and territories, and thus you should check the relevant regulator for requirements.
Other common types of insurance include:
- Property damage: Just like having insurance for your homes, this insurance is particularly popular because it protects business buildings and their respective assets or possessions from most forms of natural disasters, fire, theft, etc..
- Professional indemnity: Covers faulty advice, errors, omissions, negligent acts when providing professional advice and services. This insurance can cover your business up to a limit – legal defence costs, third party legal costs, any court awards made against your business.
- Business interruption: When it comes to rebuilding your premises, finding new premises and staff, this insurance covers your business when it is out of action due to events or risks like these. You will need to select an indemnity period for which you want to cover your business for the loss of gross profit.
- Employment practices liability: Covers damages and costs as a result of situations where staff members have claimed workplace discrimination, unfair dismissal, bullying and harassment.
- Fidelity guarantee: Covers any fraud or dishonesty committed by your employees.
Legal advice
Making an insurance claim has its risks and may not always be successful. Ensure that you first work and cooperate with your business provider and advisers to understand what you are and are not covered for, and check that your insurance is up to date and fully comprehensive for your business needs. Being under-insured is a massive risk, but over-insurance is also an unnecessary cost. Legal Kitz can assist you in advising as to any business insurance you may need. To arrange a FREE consultation with one of our highly experienced solicitors, click here today, or contact us at [email protected] or 1300 988 954.