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Insurance policies: Differences & similarities for SMEs

Insurance policies: Differences & similarities for SMEs
You might think that business insurance policies for SMEs are all the same. You would be partly right, because some of the policies are suitable for all SMEs, however, others are more specific to particular types of businesses. These differences make it vital that you ask the advice of an insurance specialist before deciding which policies are best for your business. For example, a butcher or a restaurant owner might need insurance that provides food spoilage cover, just in case their freezer breaks down. With a basic insurance policy they could be out of pocket if all the frozen meat thawed over the weekend, and they didn't have the right type of policy. Hairdressers or nail salons need Products Liability, whereas an accountant or adviser will need Professional Indemnity. So let's take a quick look at some of the policies that are the similar amongst all SMEs, and then at some of the policies that are geared towards SMEs with common industry. Each type of insurance policy can be tailored to meet the requirements of specific sectors.

Insurance policies required by all SMEs
These are some of the types of policies that are similar amongst all SMEs.

Public Liability: This covers you if you or your employees actions result in physical injury or property damage to a third party, during the course of conducting business. This type of insurance is often compulsory for many businesses.

Property Damage: This covers your business building, stock and contents from various insured perils such as loss due to fire, vandalism, theft.

Business Interruption: If your business is unable to trade due to a disaster, this insurance policy covers the ongoing expenses that still need to be paid, even though your revenue has temporarily ceased.

Insurance policies specific to certain sectors
These are some of the types of policies that are tailored to specific SMEs.

Contract Works: This is designed for builders and other tradesman to reduce the financial risks occurred for project delays, theft of on-site equipment, accidental damage to structural buildings, arson, and so on.

Products Liability: Does your business resell products from a third party or manufacture and sell your own products from your premises? If so, this policy protects you against claims of personal injury or property damage cause by products sold by your business.

Professional Indemnity: This is the type of insurance needed by lawyers, accountants, doctors, hairdressers, beauticians, nail technicians and engineers. In fact, anyone who provides a professional service or advice, needs Professional Indemnity Insurance against claims of a breach in duty.

Plant & Equipment: For SMEs that rely on mobile plant and equipment to carry out their business, this insurance policy is vital. It covers you for loss of this equipment, as well as injuries or property damage resulting from its use in the field. There are many other types of insurance policies that you may or may not need, depending on your SME's core business. 

These include insurances for commercial vehicles, cyber-crime, theft of money, general property, marine & hull and builders warranty to name just a few. To decide what type of insurance policies are suitable for your business, talk to an insurance specialist today. 

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.

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.

Purchase up to six products under one Business Insurance Package. 

These are some of the types of policies that are tailored to specific SMEs.

Contract Works: This is designed for builders and other tradesman to reduce the financial risks occurred for project delays, theft of on-site equipment, accidental damage to structural buildings, arson, and so on.

Products Liability: Does your business resell products from a third party or manufacture and sell your own products from your premises? If so, this policy protects you against claims of personal injury or property damage cause by products sold by your business.

Professional Indemnity: This is the type of insurance needed by lawyers, accountants, doctors, hairdressers, beauticians, nail technicians and engineers. In fact, anyone who provides a professional service or advice, needs Professional Indemnity Insurance against claims of a breach in duty.

Plant & Equipment: For SMEs that rely on mobile plant and equipment to carry out their business, this insurance policy is vital. It covers you for loss of this equipment, as well as injuries or property damage resulting from its use in the field. There are many other types of insurance policies that you may or may not need, depending on your SME's core business. 

These include insurances for commercial vehicles, cyber-crime, theft of money, general property, marine & hull and builders warranty to name just a few. To decide what type of insurance policies are suitable for your business, talk to an insurance specialist today. 
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.


Gail Findlay, IA South West, AFSL 240549

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