Business Insurance

An Overview Of Common Policy Features

Fire and Perils

Covers your business for damage to insured property, that includes building, contents, thefts and stock caused by certain defined events:

• Storm
• Malicious damage
• Explosion
• Earthquake
• Wind
• Leakage of liquid
• Flood (depends on insurance product)

Additional extensions of cover are also included:

• Removal of Debris
• Accidental Damage
• Claim Preparation Costs
• Rewriting of Records

Business Interruption

Provides cover for consequential loss of profits or revenue resulting from the interruption or interference with your business caused by damage covered under the Fire and Perils sections. There are several different options of cover available. These include:

Business Income Protection:

• Weekly income
• Additional expenses (e.g. – relocation costs, expediting expenses)

Consequential Loss of Profits:

• Gross profit
• Loss of rent receivable
• Payroll

Claims Preparation Expenses:

Reasonable professional fees and other expenses necessarily incurred as a result of the property claim (as agreed by the insurer and subject to policy limit).

Additional Increased Costs of Working:

This option, if selected, provides cover for additional expenditure not otherwise covered under any other section following a loss. It provides cover for reasonable costs incurred to minimise the loss or damage caused to the business. An example of such is cover for additional payroll and advertising expenses required to maintain the business customer base (as agreed by the insurer and subject to policy limit).

Outstanding Accounts Receivable:

Cover for the amount owed to the business that it is unable to collect due to damage to records.

Public & Products Liability

Provides insurance cover in respect of insured’s liability or loss or damage caused negligently to third parties, who are not the insured, as a result of an occurrence in connection with the insured’s business.

It indemnifies the insured business against legal liability to pay compensation in respect of personal injury or property damage claims arising in respect of the product and/or service sold or supplied by the insured, however it does not cover product warranty and is always subject to terms, conditions and exclusions.

In addition, these policies also provide cover for defence costs even if the action against you is false or fraudulent, provided that an excluded circumstance does not apply.

Personal Injury cover may include:

• Death, bodily injury, sickness, disease, disability, shock, fright, mental anguish and mental injury;
• False arrest, wrongful detention or imprisonment, and malicious prosecution;
• Wrongful eviction;
• Assault or battery; and/or
• Libel, slander, defamation of character or invasion of the right of privacy.

Property Damage cover may include:

• Physical damage to tangible property; and/or
• The loss of use of tangible property which has not been damaged but cannot be used due to damage to other tangible property.

Theft/Burglary

Covers insured property (business contents, stock and customers goods as declared) contained on your business premises following forced and violent entry. Additional cover includes damage to buildings and fixtures, replacement of locks, protection of premises, and temporary removal of your property insured to another location subject to the policy limitation.

Money

Covers loss of, or damage to, money contained in the building during or outside business hours, while in a locked safe or strongroom, in transit, or in your personal custody while contained in your private residence.

Cover options available:

• Transit to or from your business premises;
• Money while contained in the night safe of any bank; and/or
• Money contained in the building:

(a) During business hours;

(b) Outside business hours; and/or

(c) Only while contained in a securely locked safe or securely locked strongroom.

Glass

Cover provides protection against accidental breakage of fixed glass located at the business premises. Property covered includes items such as glass/Perspex – windows, doors, mirrors, and skylights for:

• Fixed external glass; and/or
• Fixed internal glass

In most cases the policies also provide cover for wash basins, lavatory pans and cisterns.

Employee Dishonesty

Covers the loss of money or goods (i.e., stock) due to the fraudulent or dishonest conduct of an employee, for their own gain or the financial benefit of any other person or business.

A few examples of events which are covered include:

• An employee stealing money to fund gambling activities; and/or
• An employee organising with another person to over-pay invoices or pay false invoices

Machinery Breakdown

Covers for damage to electrical, electronic, and mechanical machinery insured due to breakdown located at the business’s premises.

Cover provides compensation to your business for:

• The costs of restoring or replacing machinery after Breakdown; and/or
• The cost of hiring temporary machinery

Additional features and benefits:

• Cover is available under this section for deterioration/loss of stock (up to the nominated sum insured) following a breakdown.

Portable Property

Covers items such as laptop computers, tools of trade whether at or away from the premises.

There are principally two covers available under this section:

• Accidental damage covers any sudden, unexpected or occurrence not otherwise excluded; and
• Restricted cover to collision, overturning of the conveying vehicle and flood. Fire cover is available as an optional cover.

Goods In Transit

Covers your business for damage to property insured whilst in transit within Australia caused by certain defined events. It provides cover for loss of, or damage to, goods insured. There are several cover options available:

• Fire, Collision and Overturning covers overturning of the conveying vehicle, resulting in your insured item(s) being destroyed
• Fire, Collision and Overturning and Theft covers the conveying vehicle being broken into and your insured item(s) being stolen
• All Risks not excluded covers the insured item(s) being dropped by the carrier resulting in your item(s) being destroyed (covers all risks of loss or damage not otherwise excluded)

Tax Audit

Cover for professional fees in connection with an audit by a government body. Cover can be extended to include audit cover of directors of the insured’s business.