What am I responsible for as a business owner?

There are countless circumstances that may have a negative effect on your business, many of which are impossible to predict. The good news is that it is possible to prepare for any eventuality, thereby safeguarding your business from potential financial ruin. The best way to do this is with the right business insurance.

However, as a business owner, what specific types of business insurance are you responsible for? What insurance are you required to have by law? Furthermore, which types of insurance are worthwhile considering despite not being mandatory? Let’s find out.

Workers’ compensation

If your business has any employees, then workers’ compensation is a must. Essentially, it is a type of accident insurance paid for by employers which provides coverage should an employee be injured on the job. The insurance will pay for medical-related costs and will provide wage-loss compensation in the event that the employee is unable to work for a period of time following the accident/injury. Workers’ compensation also applies to circumstances when an employee contracts a work-related illness. Workers’ compensation is solely the employer’s responsibility – there are no deductions made from the employees’ salaries in order to pay for it.

Public liability insurance

Public liability insurance, although mostly optional, is required by law for certain types of businesses in Australia. In essence, it protects your business from financial ruin should you or your employees ever be accused of negligence. It may offer cover in the following situations:

  • injury or death
  • providing negligent advice
  • property damage
  • consequential loss, which occurs in very rare cases where a negligent act causes a third party business to lose expected revenue.

Third party personal injury insurance

This type of insurance is required by law, but only if you own a motor vehicle or a business vehicle. Many business owners will be pleased to discover that third party personal injury insurance is often included in their vehicle registration fee. Ultimately, it provides cover for any costs relating to injuries that a motorist may cause to others in a motor vehicle crash anywhere in Australia. Most third party personal injury insurance will cover treatment, care and support of the injured parties, pay for claims management expenses, and settle worries regarding both past and future economic loss in relation to the injury.

In order to remain compliant, all Australian business owners must make sure that they have invested in the right insurance as per the law. Remember, however, while there are specific types of business insurance that every employer is responsible for, there are many other types that are not mandatory, but that can greatly benefit your establishment in the long run including professional indemnity insurance, cyber liability insurance and stock and asset insurance. It is worthwhile to consider all of these types of insurance if you are in search of total peace of mind that your business is properly protected and ready to face any challenge that may come its way.

Mandatory data breach notification scheme

Cybercrime and its potential impact on business operations is well understood today with reports about data breaches, malware attacks and email scams of all kinds making the the news almost daily.

Businesses with websites, and that’s just about every business, hold data and information about customers. This sensitive information is at serious risk of being accessed by cyber criminals following a malicious cyber attack that results in data breach.

The cost to Australian business of data breach is staggering, numbering in the tens of millions of dollars, as detailed in a 2017 report produced by the security division of IBM.

What was once mainly a problem for big business now encompasses small and medium businesses of every description with service providers at the top of the list of industries targeted.

Recent legislation means that it is now mandatory for any affected business to report a data breach to the government and its customers.

If a business suspects they have been subject to a data breach, they will be required to carry out an assessment within 30 days. If there are then reasonable grounds to believe a data breach has occurred, the business will need to notify the Australian Privacy and Information Commissioner, as well as all the affected individuals.

The government believes the new scheme will strengthen the protections afforded to everyone’s personal information, and will improve transparency in the way that the public and private sectors respond to serious data breaches. It will also give individuals the opportunity to take steps to minimise the damage that can result from unauthorised use of their personal information.


How to protect your business from the costs of data breach.

1. Businesses should take reasonable steps to make sure personal information about customers is held securely – including being equipped with a clear response plan in the event of a data breach.

2. Be sure to have sufficient cybercrime insurance to cover the cost to your business of any breach. Insurance can cover the cost of:

  • IT advice and services to ‘clean’ your IT system.
  • Loss of income due to interruption to your business.
  • Legal liability costs if an affected customer takes legal action

3. Call us for more information. An affordable, cyber insurance policy will free you to concentrate on running your business. The insurance will watch your back.

What insurance cover does a growing business need?

One of the drawbacks to owning a growing business is having more at stake. An expanding business is likely to be having dealings with an ever-increasing number of individuals, getting involved in a wider range of commercial activities, even expanding into new locations.

A growing business usually requires a growing workforce. With more equipment and larger premises come more expensive rent payments. In such circumstances, any revenue-disrupting interruption to its activities can soon escalate into a cashflow crisis.

In short, the cover that was sufficient when you were a sole trader or running a scrappy start-up isn’t likely to be adequate once you’re heading up a thriving enterprise. The end of the financial year is a great time to think about how your business has changed over the last 12 months and review your insurance policies. If you’re pressed for time or simply want the reassurance of an expert opinion, a Steadfast Insurance broker can assist you.

Employers’ liability insurance

When it comes time to make your first employee hire, you’ll be legally required to take out workers’ compensation insurance. You should consider taking out a form of back-up workers’ compensation insurance called employers’ liability insurance. This is because it’s possible for an employee to suffer an illness or injury that is job-related yet not covered under a standard workers’ compensation policy (employers’ liability insurance can cover for these type illnesses, injuries and fatalities.) Even if it’s not a legal requirement, to be an employer of choice, you could have employers’ liability insurance as an additional benefit if you want your employees to have better cover in the event of an employee suffering a misfortune.

Directors’ and officers’ insurance

A growing business will inevitably become more hierarchical and possibly move from a sole trader or partnership business structure to a company one. In any largish enterprise, there are individuals – executive directors, non-executive directors, executive officers, senior managers and the company secretary – who shoulder important responsibilities.

Understandably, these people don’t want to be placed in a position where they could suffer personal financial loss as a result of doing their job. By providing directors’ and officers’ insurance, a business owner can provide cover to key staff and board members. That means they can be reimbursed for their legal costs if competitors, creditors, employees, liquidators, regulators or shareholders take legal action against them.

Business interruption insurance

The more your business grows, the larger its fixed costs are likely to be and the more expensive an interruption to its smooth functioning will become. A suburban café may only be out of pocket a few hundred dollars if a blackout means it has to shut down for the afternoon. In contrast, it’s estimated Starbucks’ recent decision to close its US stores for an afternoon (to provide racial-bias training to staff) cost around US$12 million (A$16 million).

If an unfortunate event means you need to shut up shop, your revenue will typically be severely impacted during the shutdown period. Nonetheless, you’ll probably continue to face the usual wage, rent and other business costs. As explained more fully here, business interruption insurance can provide a pay-out to cover you for those costs, as well as make up for lost sales.

Cyber insurance

In the digital age, an IT issue can be as devastating as any fire, flood or storm. The two threats businesses, especially smaller ones with limited IT budgets, most need to worry about are ransomware attacks and data theft.

A ransomware attack results in a business’s files being encrypted. Important data is rendered inaccessible, which can make it difficult or impossible for a business to keep operating – until a ransom is paid to return things to normal. It’s estimated that, globally, ransomware inflicted US$5 ($A6.5 billion) of damage in 2017.

Governments in Australia and elsewhere are tightening privacy regulations and stiffening financial penalties for data breaches. If a malicious actor overcomes your cyber security and captures your customers’ personal data, the consequences can be more serious than brand damage. You could find yourself being investigated by the government regulator and being sued by your customers. As explained more fully here, cyber insurance can help cover financial losses arising from a cyber security breach

Source: Tis article was first published by Steadfast Well Covered

Valuables and Collectibles insurance. Valuation updates now due?

When was the last time you had your jewellery valued? And what about that fine art collection in your home or office boardroom? Whether you have the odd piece or a truckload, chances are your precious items are worth a lot more than you think.

Fine art is not just limited to paintings and works on paper. All manner of Collectibles fall under this heading, including sculptures, porcelain, jade, photographs, tapestries, sports and other memorabilia, vintage clothing, antiquarian books and manuscripts, antiques, stamps, coins, vintage clocks, finely crafted musical instruments and wine.

Like any other item of value, it’s important that your Collectibles are properly covered in case of theft, fire or other misfortune. Although no amount of money may replace your prized collection, it can help you to rebuild it. First and foremost, insuring your collection involves talking to your broker. Find out whether or not your precious items are covered under your current policy and if not, how best to get proper cover.

You’ll need the services of a professional valuer to assess and confirm a true value but their fee will prove to be negligible in the event of an insurable event further down the track, especially if your collection is of significant value. A written appraisal will prove the worth of your valuables.

Your policy may require you to photograph and/or video your entire collection but do it anyway, it will make a future claim an easy process. If possible, make sure that the date stamp is imprinted on the photo(s) or displayed on the video. This will help to prove the authenticity of the images if necessary in the future. Include images of yourself wearing the jewellery or show an art piece in-situ in your home or office

As a final step to documenting your collection, take a written inventory of each piece, including a detailed description. Once you have all of the necessary paperwork and information gathered store the appraisal, your insurance policy and any written, photographed or video documentation relating to your collection in a safe place easily accessible by you, your family or associates.

While the documenting process may seem like a lot of work now, it will prove to be worthwhile if an event results in the loss of your collection. You may never need to make a claim but the process will provide you with great peace of mind just knowing that it is there.

Westcourt General – Top 10 Insurance Brokerage 2013 & 14

Jeff Hollands, Managing Director of Westcourt, describes the year’s professional highlights, and what makes Westcourt unique.

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Cyber-crime: A growing menace

The reality is that all companies, large or small are targets for cyber criminals. Unfortunately many businesses operate under the belief that their existing insurance policies are enough to cover their data security and privacy exposures. This is not the case.

Australian insurance companies however are at the forefront in making good the damage of cyber attacks. Although stopping the hackers and other criminals in their tracks is not within their capability, they are able to provide the next best thing… picking up the financial pieces of damaged businesses following a cyber attack event.

Cyber attack insurance. What can be covered?

Cyber attack insurance can protect you from claims arising from your use of the Internet, email, intranet, extranet or your website. Cover can include but is not limited to:

Breach of privacy
Damage to your network or website
Transmission of a virus
Third Party Liability
Cyber Extortion

Please contact our office for more information and professional help to implement the right cyber risk protection strategy for your business.

Steadfast Life Partnership

Hynes Honeychuch Insurance Advisors have partnered with Steadfast Life a specialist Life Insurance Advisor firm to provide Life Insurance and tailored Business Life Insurance solutions to Our Clients.

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