As a business, it is important to insure yourself against certain common risks. Insurance for your business not only protects your business assets, but it also protects the interests of your clients. If you have recently started a business or are in business and do not know much about insurance, read on to learn the basics of business insurance.
What to Look For In Business Insurance
The first thing to consider when taking business insurance is your legal obligations with regard to insurance. In Australia, certain businesses are required to have some mandatory insurance. The kind of insurance that applies to you depends on your type of business and the number of employees, among other things. For example, accountants may be required to have professional indemnity insurance.
Business insurance should also cover your entire business assets. For example, you can protect your assets by taking general property insurance. There are policies you can choose to protect specific items such as valuable curios and works of art. You should also not forget to insure yourself. For example, you can have a specific personal accident or sickness cover in case of an accident or sickness.
Another thing you have to guard against is being underinsured. A survey by the Australian Insurance Council found that many businesses were underinsured especially in the wholesale, recreational and transport sectors. To avoid being underinsured, you should make sure you know the accurate value of all the assets you want to protect and get a cover for that amount.
Types of Business Insurance
The most common types of business insurance policies are professional indemnity, public liability and tax audit insurance. Professional indemnity protects you against legal action that may be taken against you if a person suffers from a loss as a direct result of your advice or services. Public liability insurance caters for the compensation and legal costs you are required to pay if you caused death, injury, damage or loss to a person due to gross negligence.
Tax audit insurance is an essential policy considering the random tax audits carried out by the Australian Taxation Office. Dealing with tax audits is expensive, stressful and time-consuming, which can ultimately cost you thousands of dollars. With tax audit insurance, some of the expenses incurred during an audit, such as professional fees from lawyers, accountants and bookkeepers.
Endnote
If you are planning on taking out business insurance, it is crucial to determine the legal obligations in your industry with regards to insurance. You should also take stock of your assets and insure them. There are many types of business insurance to avoid confusion, and to ensure you and your assets are sufficiently protected, you should take time to learn about each of these policies and select one that is suited for your practice.
Share19 May 2020
Hi, my name is Jennifer. I am a professional, a mother and a home owner. I also have insurance policies that affect all of those roles. I have coverage on my business, life insurance to protect my kids in the event anything happens to me and coverage on my home. I have found that the basics just don't provide the peace of mind and security that I need so I always buy supplemental policies. If you want to ensure that the people and things you love are protected from a financial standpoint, you may also need supplemental policies. This blog will explain what you need and how to know what you need. It will also have money saving tips. Enjoy!