Insurance, like tax, can be daunting or confusing for lots of small business. There are so many kinds of insurance, and so many different things you can cover, it can be hard to know where to start.
The truth is, like it or not, insurance is something most businesses need. You spend so much time, money and effort building up your business, it makes sense to protect it and the investment you’ve made.
But we all want value for money, so here are things to think about before you make a decision on insurance for your business:
1. What kind of insurance do you need?
First, think about the parts of your business you need to cover.
There are more insurance options available than you might think. You can get business insurance that covers your:
- Vehicles (like cars, utes, trucks and trailers)
- Business premises (if you have a workshop, showroom or retail store)
- Your tools (very important if you’re a tradie or have specialised tools)
- Electronic equipment (if you run your business from home, where would you be with-out your computer?).
Don’t forget to ask other small business owners you know and find out what decisions they made. There’s no ‘one size fits all’ with insurance, but people in your network can give you good tips (and usually have a few war stories to share).
2. What are the common mistakes to avoid?
The most common mistake is not having enough insurance. This is sometimes because:
- People assume their policy covers everything (like someone who gets Public Liability Insurance for an event, but don’t cover the stock they’re taking to the event or the car they’re driving there)
- People don’t sit down and run through everything that they’d need to replace if there was a disaster like a fire (or they underestimate how much it would cost to repair or re-place everything) and just pick a ‘ballpark’ figure
- People don’t keep their insurance policies up to date after a few years (like if you re-place your tools or fridges with more expensive versions, but forget to increase the amount of insurance you have).
So do lots of research, read all the information carefully, calculate the value of everything you’re covering, then make your decision.
Don’t just go for the cheapest option - if it seems too good to be true, it probably is. Go with a company that’s been around for a while, and one you believe will be easy to deal with if you make a claim.
3. Where can find information about my specific industry?
Search the internet, talk to other people in your industry, or chat directly to an insurance company about what they’d suggest.
As a rough guide to get you started, here are the kinds of cover you could think about de-pending on your business:
- Tradies with a mobile business: tools & general property, motor vehicles, personal ac-cident and illnessTradies with premises: tools and general property, fire, business inter-ruption, specialised machinery
- Professionals: fire, business interruption, electronic equipment, burglary, tax audit, professional indemnity
- Retailers with premises: fire, business interruption, electronic equipment, burglary, glass
- Home businesses, online businesses or market stalls: contents at the home, electronic equipment, motor vehicles, fire
- Hospitality: fire, motor vehicles, business interruption, machinery, money.
Even if you’re still trying to figure out what kind of insurance your small business needs, we’re here to help. Take a look at our Business Insurance or give us a call to learn more about what’s available.