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What is Commercial Insurance? How to protect your small business from financial loss

  • Adroit Insurance and Risk
  • May 23, 2022

As a small business owner, you work hard and have a lot of responsibility on your shoulders. So it goes without saying, your business asset is worth protecting against sudden, unexpected events. Without Commercial Insurance in  place, you could suffer substantial financial losses and your business could even go under. 

If you aren’t yet insured; if you’re a startup looking for the right insurance, or you need to update your cover, contact Adroit Insurance & Risk and let our expert brokers help you today. 


What is Commercial Insurance?

Commercial Insurance and Business Insurance are terms used interchangeably, so they are basically the same thing.  It’s insurance to protect your commercial business asset in case you suffer public liability claims, damage and losses from floods, fires, theft and many other calamities. 

Each individual business in each different industry or trade will need different levels and kinds of insurance, so there’s no standard cover for all commercial enterprises.  Your insurance requirements will vary depending on the size of your business, where you are located and the commercial activities in which you are engaged.

For instance, a home-based accountancy business faces different risks and requires a different type of commercial insurance to a car tyre company with a shopfront and many employees. 

Still, they all have one need in common, and that’s adequate and appropriate insurance.  Contact Adroit Risk Advisers today to ensure your business is adequately covered. 

Some Commercial Insurance is Compulsory

As your Adroit Risk Adviser will explain, to protect your small business from financial loss, there are compulsory insurance policies that you must have to operate legally.  

These can be legislative requirements and obligations as professional associations or board members. They may also be required to contract with a customer or a landlord. These are some  insurances that may be compulsory for your small business:

  • If you employ workers, you must have workers’ compensation insurance cover.
  • Like any vehicles on the road, your business vehicles must have CTP Green slip insurance. 
  • You may need public liability insurance cover for third party death or injury. 

Our Adroit Risk Advisers can tailor your insurance needs to your commercial enterprise and industry.

Public and Product Liability Insurance 

Whether it’s compulsory for your business or not, every commercial company should carry public liability insurance to protect their asset. Home-based small businesses and sole traders need this insurance. Public liability and product liability coverage protect you, your employees, suppliers, and the public against claims.

Imagine a worker, supplier, a customer, or you suffer an injury on your premises or due to a product you manufacture or sell, and you don’t have insurance in place to cover a claim?  You could be liable if a customer slips on a wet shop floor and breaks a leg or if workers damage a customer’s home during a renovation. It could cost you your business. 

Commercial or Business Insurance Packages

Business or commercial insurance can often come in a package deal with various coverages. The most common coverage in a commercial business insurance package can be general property, building and contents, glass and theft.  

These policies may protect your business asset from material damage, leading to financial loss due to unexpected events such as storms, fire, accidents, and theft. 

Coverage may include loss or damage to valuable possessions like computers, phones, electronic equipment and office furniture. Business premises may also be protected, and your package may consist of a public liability policy and business interruption insurance.

Professional Indemnity Insurance

If you are a professional and provide a service or are paid for advising as part of your business activities, you need professional indemnity coverage.

Professional indemnity may cover your legal costs to defend yourself against damages claims should your advice or service harm someone. Consultants, chiropractors, architects, engineers and accountants are just a few professions needing professional indemnity coverage. 

Management Liability Insurance

Company directors and senior managers need management liability insurance coverage against mismanagement and the risks and exposures of running a commercial business. 

This insurance may provide cover against claims arising from legislative breaches and misconduct, statutory penalties and fines, defamation, unfair dismissal and others. Losses due to dishonesty, theft and fraud by workers may also be covered.

Cyber Liability Insurance 

If your small business or commercial enterprise has an online presence and stores sensitive customer data on computers or laptops, you should consider a cyber liability insurance policy. 

This insurance may protect your business in the event of hacking, ransomware or cyber-attacks. If your website is defaced or hijacked or sensitive data is stolen, the financial loss you may face can seriously threaten your business and damage your reputation.

Tax Audit Insurance

The Australian Taxation Office is now randomly auditing many small business owners. Audits are often stressful, time-consuming, and costly, leading to financial loss. 

Tax audit insurance may protect your small business assets by covering professional fees from bookkeepers, accountants, lawyers, and other advisors.


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