INSURANCE: What you need to know and have…

Author: Laetitia Kilpatrick, Youth 2 Youth

Insurance is as important as finance and legal security - especially for small businesses. Choosing your insurance is an important process and should be done with caution.

You are legally required to provide a number of coverage's - including workers compensation and unemployment.

When choosing your policy there are a number of things that you must do to ensure that your insurance premium is well spent:

• disclose to your insurer everything about your business that is relevant and ensure that this info is kept up to date
• compare policies and the prices
• check what is covered and what's not
• When does your protection commence?
• Is your policy relevant to your business activities and are you covered for all of these?
• What are the claims procedures? What is the service like?
• What are the renewal conditions like?

The following outlines where and what areas need coverage and the extent of your liability:

• MANDATED COVERAGE:
  Areas such as workers compensation are legally required and depending on the size, type, and scale of your business, other coverage may be legally required. This information can be gained from visiting www.ica.com.au or www.lawsearch.gov.au Read the legislation relevant to your business.
• HEALTH CARE AND YOUR BUSINESS:
  Not only do these secure and protect your business but they can also act as attractive employee benefits and recruiting tools. This area of insurance is expensive and confusing so shop around and ensure you ask informed consumer questions before deciding what cover you choose to take.
• LIABILITY AND OTHER COVERAGE:
  As a business owner make sure your business is protected against the normal and expected business risks.

The Main Insurance Policies that should be included in your business's insurance are listed below:

• Fire Insurance: to cover the building, contents and stock of the business.
• Business Interruption or Loss of Profits Insurance: this provides cover if the business is interrupted through damage to property by fire or other insured risks. It pays wages, working cost and maintains net profit.
• Burglary Insurance: covers theft of property and damage due to burglars breaking in.
• Workers Compensation: compulsory for all business that employ staff.
• Personal Accident or Sickness: for management if illness/accident occurs.
• Fidelity Guarantee: covers losses due to wrong handling of goods or cash
• Money: covers loss of money being taken from and to bank and on your premises.
• Public Risk: covers legal liability if someone not related to your business suffers an injury.
• Superannuation: compulsory provision of employee superannuation.

All the coverage and insurance areas referred to should be considered and sought after with relevance to your business's individual needs. This should be done with your insurance agent in order for your business to be fully protected and to ensure your business would remain liable if misfortune should happen to occur.

The National Insurance Brokers Association (NIBA) has a listing of brokers in your local area and in a wide range of specialities. Click on to www.niba.com.au for more information.

'Copyright 2003 Youth 2 Youth'

Disclaimer: This article is for your information, but it may not apply to or be suitable for your situation, so seek professional advice. Youth 2 Youth cannot be held liable for anything resulting from how you use the information provided in this article.