Are you starting a small business? Having your own business can be a flexible and rewarding way to make a living, but there are certain risks involved. According to a 2011 Australian Government report on small business, the average survival rate for small businesses in 2007-2008 was around 10% lower than their medium and larger sized counterparts. Although not every difficulty can be planned for, having the right business insurance may give your business a much better chance of surviving in the face of a disaster.
The array of different business insurance options available can be overwhelming, so how do you know what you really need? Your exact insurance requirements will depend on the nature of your business, but there are a few types of cover that are essential – no matter the size and scope of your enterprise.
- Building and contents insurance. Insuring your business premises and any equipment you have means you should be able to claim financial recompense in the event of a fire, theft or certain types of weather damage.
- Liability insurance. Depending on what type of business you have, there will be certain liability risks. Protecting yourself financially against the cost of being on the receiving end of a lawsuit could not only keep your business safe, it could also prevent you potentially losing your home and any other assets you own.
- Key person insurance. Up until recently, Australian businesses have been able to insure against the negative financial impact which would arise if a key person dies, suffers from TPD or a trauma event. However, the unexpected temporary absence of an owner of income-generating employee due to sickness or injury can also have a sever financial impact, especially for small businesses where the revenue may be generated by a few people. Key Person Income cover can be used to help against this risk.
- Commercial auto insurance is essential for any vehicles which are used for business purposes.
There are plenty more options for business insurance cover, including tax audit insurance, marine insurance and even technology insurance to protect against some of the costs of cyber-attacks.
When you are considering your small business insurance requirements, it is always a good idea to get professional advice that is tailored to your enterprise. For an appointment with a qualified Insurance Adviser, contact us.
Sources: Innovation report on small business statistics 2011 – http://www.innovation.gov.au/SmallBusiness/KeyFacts/Documents/SmallBusinessPublication.pdf
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