If you're just starting out in business, insurance should be a top priority. This is because once you have opened a new business, insurance can be one of the most important factors in ensuring you stay open.
How to minimise being underinsured
Many Australians, especially those who own businesses, discover they don’t have the cover they need in the worst possible circumstances.
Insurance is one of those subjects that many people glaze over. So, just to test how knowledgeable you are about this important but unsexy topic, see how many of the following you can answer.
5 tech-savvy ways to prevent tools being stolen
Do you know your responsibilities as an online business?
Online businesses are charged with responsibilities above and beyond those of a traditional bricks and mortar store.
Starting a retail business is, in many ways, easier today than it’s ever been. It’s perfectly possible, and indeed common, to start a retail business from home with nothing but a website and a small amount of inventory.
The insurance implications of working from home
Australians are increasingly working from home, with the most recent data from the Australian Bureau of Statistics indicating at least a third of us choose to work from home at least past of the time.
Bushfires and business interruption
Some insurers have already started to pay claims to bushfire-affected businesses on the NSW South Coast, as their business interruption insurance policy provides for weekly payments.
Having this support has been important for affected firms to stay in business. It allows them to maintain their cash flow and pay regular outgoings such as rent and wages.
Under a business interruption policy, business that suffer an insurable event can claim for loss of income.Policyholders in the best position have been those that have been able to quickly provide their financial information to support their claim.
Christopher Connolly, underwriting manager with underwriting agency Interruption Underwriting Agencies (IUA), explains.“The fires happened on New Year's Eve. The first business day was Thursday 2 January.
We started to pay claims the following Friday 10 January, which was within 7 business days” he says.
“Most of the businesses affected by the fires were small, family-run operations”
Affected businesses such as restaurants, shops and other local stores have been able to claim under a prevention of access clause in their policy.
The clause is triggered because the authorities issued directives that closed the roads. This meant the annual influx of tourists the South Coast receives could not reach the businesses in the towns affected by the road closures.
Some roads remained closed at time of writing.
The fires and subsequent road closures hit these businesses especially hard given how reliant they are on tourist trade during the summer holiday period. It’s a time when most of them make the bulk of their revenue.
Additionally, most of the businesses affected by the fires were small, family-run operations.“These people rely on the cash flow from their business to support their livelihoods. So they need a policy that responds quickly,” Connolly says.
It’s a timely warning to all policyholders to check their insurance and assess the level of cover they have under their business interruption policy. It’s especially important to see if the policy includes provision for weekly payments.
This can make all the difference after a major disaster such as the Black Summer bushfires to ensure businesses are able to continue to trade and maintain their obligations while they get back on their feet.
Do you have enough insurance for your small business?
Underinsurance remains a serious issue for small businesses, with the Insurance Council of Australia’s (ICA) statistics showing 12.8 per cent of small businesses and 24 per cent of sole traders have no insurance. Organisations operating in the education sector have the highest rate of non-insurance at 25 per cent of entities in this industry with no insurance.
Why use an insurance broker to purchase insurance?
How to structure your small business - and pay yourself
So you’ve got that burning desire to start your own business. You’ve honed your particular product or service down to a sure fire proposition, you’ve researched the market, identified the demand you’ll meet and it’s all systems go.
It’s an exciting time, but it’s also a time when you need to make decisions that could prove vitally important down the track: under what structure to run your business, and how you will pay yourself - whether you take a salary, drawings from income, or loans from the company.
How to reduce your business insurance costs
More expensive premiums, higher excesses and narrower coverage are set to become an insurance reality for many Australian businesses. Here’s how SMB's can prepare for a hardening market.
Australian businesses have benefited from a soft insurance market for some years now, but it's time to prepare for a change.
We spoke with Steadfast Broker Technical Manager, Michael White about the cyclical nature of the market, the factors that drive it and how you can prepare for a harder market.