Insurance covers you should consider for your business

The policy types that are available to a business are many and varied. Let a trusted insurance broker advise on which covers you should consider.

Property

Covers your buildings, contents, stock and customers goods while at your business address.

Cover includes fire, lightning, aircraft, sonic boom, earthquake, storm, tempest, rainwater, wind, water, riot, strikes, vandalism, explosion, impact by vehicles and Accidental Damage. You can also extend cover to include items in transit or temporarily removed from your business address.

Business Interruption

Provides protection against loss of income as a result of an interruption to your business.

Cover includes interruptions caused by damage such as fire, lightning, storm, explosion, earthquake, wind, water, vandalism, impact by a vehicle, accidental damage, theft and glass breakage.

This policy section also allows you to insure against Additional Increased Costs of Working which are the additional expenses (over and above your usual expenditure) necessary to allow you to continue operating. Such as Overtime, Additional Wages, Hire of Temporary Premises, Relocating Costs, Hire of Temporary Equipment and other additional expenses (over and above your usual expenditure) necessary to allow you to continue your business activities.

You can also insure against loss of income following damage to your Debtor records and loss of income due to damage at your suppliers premises or your customers premises.

Three final comments you may wish to consider. Did you know that 30% of the claims paid out following September 11, were for business interruption losses. (American Bar Association, 2003).

1,170 people lost their job following the storms in Newcastle in 2007 due to the fact that their employers business failed to reopen due to not having business interruption insurance! (Rising Waters, 2008).

A business has less than 1 chance in 10 of surviving without business interruption insurance. (Manning, 2004).

Refer to LMI’s Business Interruption explained for more detailed information on this class of insurance.

Theft

Provides cover against theft as a result of visible forcible and violent entry or hold up. Cover may be extended to include theft without forcible and violent entry. You can also extend cover to include items in transit or temporarily removed from your business address.

Money

Loss (including theft), destruction or damage to Money. The term “Money” is defined in the Policy wording. Cover can be included for money in transit, money on your premises and in your private residence.

Glass

Covering accidental breakage through the entire thickness of glass, such as windows, doors, hand basins, toilets and display counters. You can also include cover for damage to illuminated signs and sign writing.

Public and Products Liability

Protects you against legal costs and your legal liability to pay compensation to others who have suffered Personal Injury or Property Damage as a result of your business activities.

Employee Dishonesty

Covering loss of money, negotiable instruments or goods belonging to you or for which you are legally responsible resulting from acts of fraud or dishonesty of an employee of yours.

Equipment Breakdown

Covering breakdown of pressure, mechanical, electrical and electronic equipment, such as refrigeration equipment, electric motors, air conditioners, cash registers and machinery. Cover can include deterioration of refrigerated stock, loss of business income and the cost of hiring-in temporary replacement equipment.

Electronic Equipment

Covers Computers and Electronic Equipment. Cover can be extended to include temporary removal from your business address, breakdown, reinstatement of data costs following insured damage, temporarily hiring in replacement equipment and accidental or malicious erasure of data.

General Property

Covers your property whilst in transit or while temporarily removed from your premises. It can cover Tools of trade, mobile phones, personal organisers, etc. Cover can include Fire, Water Damage, Malicious Damage, Theft from a Locked Vehicle, Theft from a Locked Building and Accidental Damage.

Taxation Investigation

Covers the costs payable to by your Accountant or registered Tax Agent following a taxation audit or detailed investigation by the Australian Tax Office in relation to your liability to pay taxes. These include income tax, fringe benefits tax, capital gains tax, sales tax, GST, superannuation payments tax and termination payments tax. This section covers your Accountant’s fees, but not the tax payable or fines or penalties.

Professional Indemnity

Protects you against civil liability claims for compensation arising from a breach of your professional services. To be considered where you provide a service and/or advice either for a fee or where you provide a service including advice that’s deemed to be of a professional nature, and a third party may sustain a loss resulting from your acts, errors or omissions from services and/or advice.

Management Liability

Is an affordable way to protect your personal and business assets against claims arising from the management of your company. It protects Directors, Officers and Employees, as well as the company itself in respect of the costs of defending a claim and in many cases the damages and costs awarded as a result of a wrongful act. These may include:

• Breach of Directors Duties
• Employment Practices
• Occupational Health and Safety proceedings
• Breach of Confidentiality
• Defamation
• Representation costs for investigations by any regulator or legally constituted professional body
• Pecuniary penalties, where permitted at law.

Cyber Liability

Cyber Attacks are on the rise and are a constant threat to businesses. The majority of businesses rely heavily on their IT infrastructure and systems to conduct their business. These systems include email, internet connections, websites and computer packages.

The Privacy Amendment Bill is expected to introduce mandatory notification of data breach incident to the privacy commissioner, making Cyber Liability Insurance even more of a necessity to businesses.

Cyber Liability addresses the first and third party risks associated with e-business, the internet, networks and informational assets. The risk category includes privacy issues, the infringement of intellectual property, virus transmission, or any other serious trouble that may be passed from first to third parties via the Web.

Transit

Covers Damage to Property Insured whilst in transit anywhere within the Territorial Limits caused by a Defined Event. This could include stock, items held for service or repair and customers goods.

Workers Compensation

Workers Compensation insurance is compulsory where you have employees. Even where you consider your workers to be Contractors, in some instances, these people may be considered to be ‘workers’ under Victorian legislation, making Workers Compensation insurance essential.

Personal Accident and Sickness

Provides for payment of:

• a set percentage of the capital sum insured if the insured person suffers an injury resulting in a defined event; or
• a weekly benefit for temporary total disablement as a result of an insured injury or sickness or a temporary partial disablement as a result of an insured injury

It also provides a number of automatic additional benefits and optional benefits.

Income Protection

Income Protection insurance can cover you against the loss of your personal income as a result of accidental injury, illness, sickness or disease. Lump sum benefits can be included for injuries such as accidental death, loss of a limb, loss of sight and loss of hearing.

Construction/Contract Works

This type of policy can cover your projects under construction, building materials and equipment onsite against fire, malicious damage, storm damage, water damage, accidental damage, impact by a vehicle and theft.

Hired in Equipment

This type of policy can cover the equipment you hire. The Hire Agreement you are required to sign to hire equipment often impose obligations on you that are not covered by any of your insurance policies. Some Hire businesses offer a Damage Waiver, however, Damage Waivers rarely offer adequate protection.

If you ever hire in equipment, we recommend you arrange insurance cover for this equipment.

Driving Risk or Test Driving

This type of policy can provide cover against damage to customer’s vehicles you or your employees drive for the purpose of testing, pick up, delivery, etc.

Motor Vehicles and Unregistered Equipment

This type of policy can cover your vehicles, trailers, plant and equipment, whether registered or not.

Cover includes accidental damage and theft, as well as damage to other people’s property caused by a registered vehicle. Motor vehicle insurance can also cover injury to other people where a registered vehicle does not have T.A.C. injury cover, such as a registered trailer. Registered trailers should also be insured against fire, malicious damage, storm damage, water damage, accidental damage, impact by a vehicle and theft.

Life Insurance

Cover can include, Life Insurance, Total and Permanent Disability Insurance, Trauma or Critical Illness Insurance, Income Protection Insurance, Business Expenses Insurance, Buy/Sell and Keyman Insurance.