Business Insurance protects you and your business from financial loss from risks such as fire, theft and property damage. Coverage can be arranged to protect from physical loss and liabilities arising.
The Insurance Council Of Australia notes that it is estimated that 70 to 80 per cent of businesses are underinsured. Cameron Research in 2006 found that 13 per cent of businesses did not have fire insurance and 65 per cent did not have business interruption insurance. And the trend has continued. According to research from Swiss Re in 2016, Australian businesses are more underinsured compared with their US and UK counterparts. And a recent survey by the Insurance Council of Australia found 26 per cent of businesses have no form of general insurance. The most uninsured are sole traders with 40 per cent of them operating with no coverage.
Some of the problem comes down to business owners not being completely across the policy document. For example, some businesses try to save on their premium costs by insuring only a percentage of the replacement value. That’s short sighted because they are only taking a percentage of the risk. A fire, an electrical fault or a natural disaster such as a storm or cyclone would lead to significant costs and months of rebuilding, which would be way over the replacement the business has been insured for.
Some businesses also fail to update their policies when the business is growing, expanding the premises, buying new equipment or diversifying the product range. So when disaster strikes and the business has to make a claim, the sum insured no longer reflects the true replacement value. Insurance policies need to change and grow with the business. The other big mistake is insuring only for the assets on the balance sheet when the replacement value also has to take into account stock, equipment and cost to rebuild, leaving the business underinsured.
Contact Experien General Insurance Services to find out more about business insurance for medical, dental and veterinary practices.
This is general information that is not specific to any one person. Life insurance and Financial Advice services are provided by Experien Insurance Services Pty Ltd (EIS) ABN 99 128 678 937 and Experien Financial Services Pty Ltd (EFS) ABN 32 631 346 757. EIS and EFS are a Corporate Authorised Representative (No. 320626 and No. 1274354) of Affinia Financial Advisers Limited ABN 13 085 335 397 AFSL No. 237857. General insurance services are provided by Experien General Insurance Services Pty Ltd ABN 77 151 269 279 AFS Licence No. 430190 (EGIS) trading as Experien Insurance Services. See our website for our Financial Services Guide. Always read the Product Disclosure Statement issued by an Insurer before considering insurance.
Source : “understandinsurance.com.au/types-of-insurance/business-insurance”
