What does business insurance cover in Australia?

The property section covers physical loss of or damage to business buildings and contents, including stock, from listed insured events such as:

▹ Fire, lightning and explosion

▹ Storm, rainwater, cyclone, hail, flood and water damage

▹ Earthquake and tsunami

▹ Impact by aircraft or vehicles, and falling objects

▹ Riot and civil commotion

▹ Theft or attempted theft

Glass cover is available as a separate section for internal and external glass, including sanitary fittings. Source: business insurance PDSs, property and glass sections.

A theft section covers loss or damage from theft of business contents and stock. One wording also pays up to $5,000 to replace locks and keys after a burglary, and up to $5,000 to repair a safe or strongroom after a theft. Theft by employees and unexplained stock shortages are commonly excluded. Source: business insurance PDSs, theft sections.

A money section covers business cash on the premises, in a safe, in transit, or held by an employee. Wordings we read include money carried by an employee travelling overseas on business (one wording: up to $5,000 per event and $10,000 per period of insurance) and counterfeit notes accepted in good faith (one wording: up to $500 above the excess). Source: business insurance PDSs, money sections.

If insured damage such as a fire or storm interrupts trading, this section covers the resulting loss of income on the basis shown in your schedule: gross profit, gross income, gross rentals, weekly income, or increased cost of working only. Extensions can cover damage at a supplier's or customer's premises (one wording: up to 20% of the sum insured), computer installations, and loss of attraction when an anchor tenant in your shopping centre is damaged. One wording pays nothing for an interruption shorter than three full consecutive days. Source: business insurance PDSs, business interruption sections.

This section covers your legal liability to pay compensation to other people for personal injury and property damage connected with your business or your products, and in some wordings advertising liability. Common exclusions include aircraft, registered vehicles, asbestos, liability you take on under a contract, and claims brought in North American courts. Source: business insurance PDSs, liability sections.

Depending on the wording, packages can also include:

▹ Management liability: defence costs for workplace health and safety claims, representation at official investigations, and fines where the law allows, on a claims-made basis.

▹ Portable items: tools and equipment carried for work, anywhere in Australia or, in some wordings, worldwide.

▹ Equipment breakdown: sudden mechanical, electrical or electronic breakdown of equipment at your premises.

▹ Goods in transit, commercial motor, and tax audit costs.

▹ Re-writing business records damaged by an insured event (one wording: up to $20,000).

Source: business insurance PDSs, optional sections.

Not every section is included automatically: check which ones are on your schedule. Exclusions and sub-limits differ between insurers, and retail and broker-arranged policies can differ too. Check the PDS and schedule for your own policy, or ask your broker.