Written by

Carlos R.

29 July 2025

A Guide to Insurance for Your Business

Are you starting a business or already running one? You’re probably juggling a lot of moving parts, and some things might not be going according to plan. That’s just the reality of business life. The good news? You don’t have to face those curveballs without help.

Business insurance provides that help.

What is business insurance?

Think of business insurance as your safety net. When unexpected events hit, and they will, having the right coverage means you won’t have to deal with all the financial burden alone. Business insurance is about protecting what matters most: your livelihood, your team, your customers, and all the hard work you’ve put into building your business.

How important is it to get insurance for a small business?

Depending on what kind of business you run, certain coverages are legally required. While some insurance types will be completely optional, these coverages might be worth considering based on your specific situation and risk factors. Because without the right insurance or insurance in general, you’ll be left high and dry to figure out how to fix the issue and pay for it on your own, which can be a tremendous burden. So if you desire the comfort of knowing that there’s help if things take a turn, then getting the right insurance in Australia is the necessary move.

Who needs business insurance?

Tradies and Contractors: Insurance in this industry is absolutely crucial. Your work sites are effectively obstacle courses of potential problems. For example, tools go missing, equipment breaks down, and sometimes accidents happen that could damage client property or injure someone. Having the right coverage means you can focus on the job instead of worrying about what might go wrong. Insurance is strongly recommended for this industry.

Retail Businesses: Running a shop means dealing with the public every day, and that comes with its own set of challenges. Whether it’s someone slipping in your store, stock getting damaged or stolen, or dealing with break-ins, retail comes with risks that insurance can help manage. It’s not always legally mandated, but it’s highly recommended.

Cleaning Services: You’re trusted to work in people’s homes and offices, which is a big responsibility. If your team accidentally damages something valuable or someone gets hurt while you’re working, you could find yourself in hot water legally and financially.

Healthcare and Beauty Professionals: Your clients trust you with their health and well-being, and that trust comes with liability. Whether you’re a dentist, physiotherapist or beautician, professional mistakes can have serious consequences that go well beyond just losing a client. Insurance is mandatory in this industry.

Real Estate Agents: You’re constantly coordinating property viewings, managing keys, and overseeing transactions worth hundreds of thousands of dollars. If something goes wrong during a showing or a deal falls through due to your error, the financial implications can be substantial. Insurance is mandatory in this industry.

Cafes and Restaurants: Food service is a high-risk business. From equipment failures that could spoil inventory to customers getting injured on your premises, there are countless ways things can go sideways in hospitality. While not legally mandated, it’s a good idea to get.

While these six industries are highly recommended or required to have comprehensive coverage, businesses across all sectors can benefit from insurance. It’s best to do a deep dive into your industry and see which insurance aligns most effectively with it. It’s better to have tailored insurance coverage than to be out hundreds or thousands of dollars.

Understanding your insurance options

Thankfully, you don’t need to buy every type of insurance out there. That would be too much, and often less is more. The trick is figuring out which ones make the most sense for your particular business.

Preparing for when things go wrong

Below are general business liability insurances to consider, many of which are required by law:

Public Liability Insurance: If your business could accidentally cause injury to someone or damage their property, this coverage has your back. It’s required for certain types of work, so check if yours is one of them.

Management Liability Insurance: This one’s for businesses with directors, officers, or managers. It covers legal claims related to how they run the business and protects company assets if their decisions lead to financial losses for others.

Product Liability Insurance: If you are making, selling, or fixing products. This coverage protects you if something you’ve worked on ends up causing injury, death, or property damage to someone else.

Looking after your team

If you have staff, it’s best to add in this one:

Workers’ Compensation Insurance: If you have employees, this is typically mandatory. It covers both you and your workers if someone gets hurt or becomes ill because of their job. Keep in mind that rules vary depending on where you’re located, and there are different requirements for independent contractors versus sole traders.

Protecting your income and yourself

There are several ways to safeguard your personal and business income. These are some to consider:

Trauma Insurance: Pays out if you’re diagnosed with certain serious illnesses.
Income Protection: Covers part of your earnings if illness or injury stops you from working.
Life Insurance: Provides financial support for you or your family in case of terminal illness or death.
Total and Permanent Disability Insurance: Gives you a lump sum if you become permanently disabled before retirement.
Employee Dishonesty Insurance: Protects against losses from staff theft or fraud.
Business Interruption Insurance: Helps cover ongoing expenses if something like a fire forces you to temporarily close.

Protecting physical assets

Whether you’re developing products, providing services, or managing physical assets, unexpected issues can arise. Consider these company insurance types based on your industry’s specific needs:

Building and Contents Insurance: Covers damage from events like fires, storms, or break-ins at your business location.
Stock Protection: Various options here, from covering perishable goods in cold storage to protecting items during transport.
Professional Indemnity Insurance: Essential if you provide professional advice or services, as it helps cover legal costs if clients claim your work caused them problems.
Equipment Coverage: Whether it’s general machinery, electronic equipment, or portable tools you take to job sites, there are insurance options to protect your gear.
Burglary Insurance: Specifically covers losses and damages from theft or break-ins.
Cyber Security Insurance: Increasingly important in our digital world, this protects against cyber attacks, data breaches, and online extortion.

Where to get help with your insurance

Luckily, there are many licensed insurance brokers, insurers, or business advisors who can offer you further advice for your specific situation. If you’re worried about not picking the right insurance or taking on too many individual ones, you can find an authorised general insurer on the Australian Prudential Regulation Authority’s Register or check an insurance broker’s license on the Australian Securities and Investments Commission’s Professional Register. Sometimes insurers can offer packages for specific industries that can be cheaper than taking out separate insurance policies.

How to manage your business insurance

Once you’ve considered options from several registered insurance companies and have locked in the business insurance you need, managing it shouldn’t be too tricky. Here’s how:

1. Get expert help: Having advice from a wide range of experts will help you out in the long run. It’s better to consider multiple options and price-match them, over picking just the first one you see. Brokers must have a current Australian Financial Services (AFS) license to help you, which you can check on the professional register linked here.

2. Understand the policy: Both you and the insurance company must have a good idea of what you’re agreeing to, so you can comply accordingly. You’ll both need to be clear on: what situations the policy covers, any excess amount either side needs to pay, and the cancellation rights. Once each party understands the policy, as the business owner, make sure you’ve met the terms and conditions of your contract, so it’s valid.

3. Review and update: Once your insurance is activated, it’s important that as a business owner, you review your policy regularly to confirm that everything covered is still compliant with the policy, and if not, changes are amended and stated in the policy.

4. Make a claim: If anything happens, the first thing you do once you’re safe is contact your insurer. They must be aware of details such as how, when, and why an incident has happened, as well as how it will affect your business. You’ll need to share photos of the damage, proof of ownership, copies of computer records, and contracts between you and the other person involved, if needed.

5. Dispute a claim: Finally, with your insurance, you’ll be able to dispute a claim if you disagree with your insurer’s decision. You can do this by lodging a dispute that explains the problem and how you’d like them to resolve it. The Australian Financial Complaints Authority is there to support you with fair, free and independent dispute support, if needed, as well.

Through these five steps, you’ll be more than ready to manage your insurance for your small business on your own. Just pick it, understand it, and use it. It’s as simple as that.

Cost savings through insurance

Getting your Australian business insured isn’t just about ticking boxes; it’s about giving yourself peace of mind so you can focus on what you do best in your industry. One or a couple of unexpected events shouldn’t be able to wipe out everything you’ve worked for. Think of insurance as an investment in your business’s future, because while it might seem like an extra expense now, it’s much cheaper than trying to recover from a major setback without any protection. It’s always best to be prepared, so you can save money in the long run.

If you’re a small business owner looking for community and support, Melbourne Connect Co-working offers an innovative space designed specifically for entrepreneurs and business founders. With premium facilities, regular networking opportunities, and plenty of resources to help your business grow, it could be the perfect home base for your venture. Getting the right small business insurance in Australia is step one, but finding the right workspace just might be the right step two. Don’t worry, we can help!