What business insurance do you need to ensure you are covered?

In the classic Star Trek series, the brave adventurers on board the USS Enterprise once remarked that their interstellar travels meant that “risk is their business.” This may be great for science fiction, but the reality is that businesses must manage risks as best they can. When things go wrong — and they will — there is insurance to help mitigate the damage. So what business insurance do you need to ensure you’re covered? We look at the options that are available.

Compulsory insurance

In Australia, workplaces must pay for worker’s compensation insurance if they have staff of any kind — and that extends to mobile workplaces and workers that work from home. This is a requirement by law. However, even if a business doesn’t legally require types of insurance and interacts with the public, it should seriously consider taking out public liability insurance (though that said, some businesses require public liability insurance to operate by law).

Public liability insurance

Public liability insurance, or accident and liability insurance, is a form of commercial insurance that shields companies from lawsuits brought by third parties after an injury or property damage.

These claims are most frequently brought by clients, customers or members of the public who are hurt or have their property damaged while on your property or in a public area where you oversee safety, such as its mobile workforce. This also applies to any of its workers and if they cause any damage to others’ property.

Why you need the right premium

You should find public liability insurance from a reputable business insurance broker to ensure you get the right amount of coverage — because being underinsured can often be as disastrous as not being insured at all.

Public liability lawsuits can potentially shutter businesses as aggrieved parties can sue for millions or even tens of millions of dollars. It can also irrevocably damage your reputation if the matters go to court. This kind of insurance will cover these claims and costs — and the costs of investigating the incident independently. Businesses need to work with a broker to ensure you get the right type of insurance for your industry, the amount you need covered, and any optional extras such as product liability insurance.

Other insurance you should consider

Other forms of insurance you should seriously look at include professional indemnity insurance, which covers you for claims of professional negligence or alleged breaches of duty of care such as giving ill-informed professional advice or bad business conduct.

Product liability insurance, as mentioned earlier, protects your business if it’s accused of causing harm through providing defective products such as faulty appliances or improperly cooked food.

Commercial property insurance covers the premises and contents — and any other business assets — from damage, theft, and spoilage (in the case of food and drink).

Cyber liability insurance covers your business if you experience IT downtime, data breaches, or cyber-attacks. It can cover the cost of getting back online and damages arising from claims of privacy violations.

At any rate, you need to consult a trusted business insurance broker to work out your requirements — it can save a lot of money and give you real peace of mind that your business is protected.

Image credit: iStock.com/NicoElNino