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Commercial Insurance: What Is It, And Do You Need It For Your Ecommerce Store?

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Insurance can be a tricky subject, particularly commercial insurance and insurance for ecommerce stores. The products are complicated, and business owners often feel put off by the terminology.

However, your ecommerce store needs protection and commercial insurance could save you from unexpected and unfortunate events and a claim that could otherwise spell disaster for your business in Australia.

Operating an online ecommerce store In Australia or anywhere leaves you open to distinct challenges and a combination of risks. The insurance packages we design at Adroit Insurance & Risk include cyber insurance and protection against a range of threats and possible claims you probably face regularly as an ecommerce retailer.

Adroit Customised Ecommerce Insurance

Our specialist brokers at Adroit Insurance & Risk will delve into the workings of your ecommerce store to find out exactly what commerce business insurance you need.

We also make sure you only get what you need and nothing more. But it may help us both if you gain a little understanding beforehand of how the insurance process in Australia works.

The following information is general in nature but can provide information on commerce insurance and claims in Australia.

Which Insurances Do Ecommerce Stores Need?

Ecommerce insurance is set out specifically for the protection of your ecommerce store which is exposed daily to both common and unique risks such as compensation claims. This commercial insurance is not the same as the insurance provided for a bricks-and-mortar business or retail store in Australia.

But an unforeseen event such as a cyber attack means your data breach insurance needs to be adequate and up to date. It can cause just as much damage to an ecommerce store and the business it operates as it can to any ordinary commercial business. Injury to a customer or member of the public and damaged or lost goods are common risks all businesses face each day and could result in hefty insurance claims.

Traditional Insurances

Firstly, an online ecommerce business should have a range of traditional commercial insurance protection such as the following:

Business insurance: this will protect online businesses against claims in the case of equipment and stock theft, damage etc.
Public liability insurance: if ecommerce businesses have a bricks-and-mortar aspect, as a small business owner you need this coverage for your business property.
Product liability insurance: if you’re selling goods to the public, you need this insurance in case your products damage a person, your property, or someone else’s property.
Personal accident and illness insurance: If you are a sole trader, this covers any loss of income as a result of injury or illness.
Professional indemnity insurance: if your ecommerce store provides professional advice or service as part of your business you need this insurance.

Management Liability Insurance

Management Liability insurance is designed to provide protection to both the business and its directors or officers for claims of wrongful acts in the management of the business.

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Business Insurance

A business insurance pack can provide cover for your business premises and contents, against loss, damage, theft or financial loss from an insured interruption to the business.

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Business Package

Purchase up to six products under one Business Insurance Package.

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Business insurance: this will protect online businesses against claims in the case of equipment and stock theft, damage etc.
Public liability insurance: if ecommerce businesses have a bricks-and-mortar aspect, as a small business owner you need this coverage for your business property.
Product liability insurance: if you’re selling goods to the public, you need this insurance in case your products damage a person, your property, or someone else’s property.
Personal accident and illness insurance: If you are a sole trader, this covers any loss of income as a result of injury or illness.
Professional indemnity insurance: if your ecommerce store provides professional advice or service as part of your business you need this insurance.

Ecommerce Insurances

A typical ecommerce business policy may offer the following kinds of small business insurance cover:

Cyber breach costs. If you sustain a data breach this insurance covers you for the repair and recovery of your data and any physical or reputational damage to your business.
Cyber liability. If a third party suffers damage or a loss as a result of your business activities this policy covers you for any legal costs and compensation claims.
Cyber attacks/extortion. If your ecommerce business is hijacked this policy covers the costs associated with ransom attacks and forensic investigations.
Cyber business interruption. Should your ecommerce store be unable to trade due to a cyber breach, this covers your cyber risks, including costs and compensation for your lost income and profits.
Hacker damage. The damage caused by hackers attacking your website is covered by hacker insurance policies and includes repairing any damage to your network, website or database.
Privacy protection. This insurance policy covers your business for any indemnification and legal costs due to loss of customer information and privacy breaches.

Ecommerce Product Liability Insurance

To ensure your business is protected, it’s important as an online retailer to have ecommerce product liability insurance cover. As a commercial insurance broker, at Adroit we offer small businesses in Australia insurance that protects manufacturers, importers and online traders selling products online. In case a product fails or causes injury or loss to consumers, this insurance is vital to cover you against claims.

Our insurances also protect ecommerce sellers where a product causes property damage in the distribution chain, or a retailer damages or botches the product in a way that ultimately harms the buyer. You need this layer of protection in case of unforeseen events as your small business will be held responsible and open to claims.

E-Commerce Shipping and Cargo Insurance

Ecommerce businesses in Australia should ideally have shipping insurance, especially for product inventory shipped directly to a warehouse. The responsibility for claims for losses, theft or damage during the goods transit to the inventory is entirely yours as the ecommerce seller. With a cargo and shipping commercial insurance policy for online stores, you will be protected against claims.

Whether it’s shipping, cargo, general liability insurance and product liability insurance, Adroit offers a broad range of policies to make sure your ecommerce business is adequately covered with the right insurance for your industry.

Do I Need E-Commerce Insurance For My Small Business?

You should think about commercial insurance to provide protection if you’re a small online business owner and you are making a profit from either services or products that you sell online. And as your ecommerce business grows, you then need to think about upgrading your commercial insurance to match.

As a business owner selling online you really need to ask yourself how best to handle risks, for example, could you replace all your stock, costly equipment and ecommerce reputation if you lost it all in an unexpected event? If you import products or export goods, ecommerce insurance coverage protects you and your business income in a worst-case scenario like costly claims.

If you’re looking for ‘commercial insurance brokers near me’ and the best quote for commercial insurance Australia-wide, you’ll find our offices in many convenient places in Victoria. Our friendly support team at Adroit is ready to tailor the right commercial insurance quote for you. Call us today on 1300 MY ADROIT or request a quote online.

Ecommerce Insurance

General Advice Warning: This advice is general and does not take into account your objectives, financial situation or needs. You should consider whether the advice is appropriate for you and your personal circumstances. Before you make any decision about whether to acquire a certain product, you should obtain and read the relevant product disclosure statement.

All information above has been provided by the author.

Adroit Insurance & Risk, ABN 75 078972 700, AFSL 244 348

This article originally appeared on Adroit Insurance & Risk Blog and has been published here with permission.