Why Management Liability Insurance Is Important

Why Management Liability Insurance Is Important

As a business owner you are personally liable for most things that go wrong in your business whether you are actually at fault or not, the liability will always be on your shoulders as the owner. 

And it’s not just larger businesses that are at risk, small and medium sized businesses can be affected as well, so it is important that you protect yourself and your business. 

Investing in management liability insurance can save you from unexpected liability expenses and legal costs from any claims that arise. 

To give you an idea of what this insurance can do for you exactly, here are a few of the protections that management liability cover offers.

Employment Practice Liability

When running a business you will have your own inhouse systems for managing employee disputes and ensuring everyone is being treated fairly. However, if any of your employees claim that a wrongful act such as wrongful dismissal, workplace bullying, or discrimination has occured it can be costly to you and your business. 

Having management liability insurance cover can protect you by financing the payouts for employment breach claims. 

Directors and Officers Liability

As a business owner you are responsible for protecting everyone that works for you including directors, officers and employees.

Having business insurance can help protect your company’s past, present and future directors, officers and managers against claims of wrongful acts, such as misrepresentation or breach of duty. 


There are a range of crimes that can occur in the workplace, so it is important to be prepared. While management liability cover won’t protect against all forms of criminal activity, this cover will protect your business from claims of employee or third party fraud. 

There are additional policies you can look into for cover for various workplace crimes, depending on the severity of the crime. 

Statutory Liability

Statutory liability covers costs associated with defending and settling claims from outside parties who are alleging wrongful conduct, as well as investigation into the affairs of the company.

This ensures your business can afford to get a high level of legal defence and protection without facing large financial losses which could bankrupt your business. 

Defence Costs

If your business ends up in court for any reason it can be expensive to seek legal advice and great defence lawyers. Without insurance, going to court can destroy a small business if they cannot come up with sufficient funds. 

Having management liability insurance can protect your business, no matter the size, by covering all the costs associated with going to court. 

If you are a business owner and do not yet have liability insurance or are looking to upgrade your policy we can help. 
Business Insurance Consulting specialises in a wide variety of business insurance policies including management liability. To learn more about our services and how we can help protect your business, you can visit our website or contact us to request a quote.

Benefits Of Cyber Protection Insurance

Benefits Of Cyber Protection Insurance

It is no secret that the majority of our lives and business is completed online, this also means however, that the risk of cyber attacks is now higher than ever. So, it is essential to protect yourself and your business from cyber attacks. 

You can do this by investing in cyber protection insurance. This is a relatively new form of cover as cyber risks have recently begun to become more prevalent. 

Some of the biggest benefits of cyber protection insurance include covering financial and reputational losses incurred by cyber attacks, as well as providing liability protection.

Let’s take a look at some of the ways that cyber protection insurance can help your business. 

Business Interruption Losses

Having cyber insurance will ensure any and all financial and work related losses that you may suffer as a result of a cyber incident or attack are covered, so your business is not significantly impacted. 

Cyber Extortion

Depending on the nature of the cyber attack, the hackers may try to blackmail your business by requesting a payment in exchange for your data or systems. 

Without insurance this can be costly, and if you cannot afford the ransom amount you risk losing all your data. With cyber insurance, all the costs of hiring professional negotiators, covering the demands, and preventing future threats will be covered. 

Electronic Data Replacement

Repairing, recovering and replacing your business’s data can be a time consuming and expensive process following a cyber attack. 

If you have insurance, through this process won’t hurt as much, as all costs will be reimbursed. This ensures you can get back to normal business operation as soon as possible, with minimal financial losses. 

Security and Privacy Liability

Cyber breaches can result in damage to your reputation if any third party data held in your system ends up in the wrong hands. 

Having cyber liability insurance your insurance company will help minimise the damage to your business. They will cover the included costs of immediate responses, ensuring payments are made on a no fault basis without admission of liability. This will ensure your business’s reputation is protected. 

Legal Costs

If you need to seek any legal defence or have to face court for any reason related to a cyber breach or attack, your insurance will cover all relevant legal costs. 

As well as covering defence costs, your insurance company will also cover all legal expenses and costs that arise from government regulator investigations.

Electronic Media Liability

Cyber attacks can result in a massive data breach, which can have detrimental effects on your business, financially and reputationally. 

Cyber insurance will ensure your reputation remains intact and cover all costs associated with data breaches, including copyright infringement, defamation claims, and the misuse of certain types of intellectual property online.

Crisis Management Expenses

If you have to call in crisis management experts to help manage the effects a cyber attack has had on your business or team, your insurance provider will cover for the costs. 

Notification and Monitoring Expenses

Notifying all of your customers of a security breach and monitoring all of their data against future attacks can be expensive and time consuming. However, with insurance it doesn’t have to be, your insurer will cover all of these expenses for you. 

If your business has a website or any electronic data online, it is important that you protect it. If your business is in need of cyber protection insurance we can help. 
You can visit our website to learn more about our insurance services or contact us to request a quote to start protecting your electronic data.

Suncorp Building

Suncorp sells bank with intentions to focus on insurance sector

Suncorp has recently announced the $4.9 billion sale of its banking operations, with the hopes that this will simplify the business, and allow it to focus its attention on insurance in Australia and New Zealand. 

ANZ will purchase the regional bank in a cash deal expected to close in the second half of 2023, subject to regulatory clearances. 

Suncorp Group CEO Steve Johnston says the transaction won’t change the insurance strategy, but it will strengthen the company’s focus as it continues to drive the performance of its brand portfolio. 

“Strategically we feel it is an opportunity for us to really focus exclusively on our insurance business and drive the sort of performance we think we can deliver in that business,” Mr Johnston said. 

Suncorp estimates net proceeds of $4.1 billion from the deal, and say that “consistent with the approach taken in previous divestments”, the current intention is to return the majority of that to shareholders.

Chairman Christine McLoughlin says both businesses will benefit from a singular focus on their growth strategies and investment requirements. 

The company’s brands include AAMI, GIO, Suncorp, Shannons, Apia and Vero. In New Zealand, it also has the AA insurance joint venture and Asteron Life.

“Our purpose of building futures and protecting what matters – the focus of our company for over 100 years – will remain at our core and enable our people to deliver on our vision to create the leading Trans-Tasman insurance company,” she said. 

Mr Johnston says Suncorp has momentum in its motor portfolio and he expects the home portfolio to ultimately recover some lost market share after the company shifts pricing to reflect increasing costs. 

“I go into this transaction with a very comfortable disposition around the performance of our insurance business,” he said. 

Both Suncorp and ANZ have made commitments to the state of Queensland as part of the transaction. 

Suncorp’s commitment includes establishing a Disaster Response Centre of Excellence, which will incorporate modern technology to monitor, prepare for and respond to extreme weather events and natural disasters. 

This centre will also include an employment hub for the firm’s flexible event workforce. 

Mr Johnston says the company has recruited more than 1000 new employees over the past six weeks to manage the east coast flooding, with a large majority of the new staff in Queensland.

Home insurance and ‘side hustles’: how worried should we be?

There’s momentum building on an insurance issue that could theoretically invalidate thousands of home and contents policies, and has consumer groups throwing around accusations of “junk” cover.

When customers take out home and contents policies they are invariably asked if any business activity takes place at the home. If the answer is no, and that’s not accurate, or it later becomes inaccurate, there’s a serious risk of claims being denied.

At first glance it doesn’t seem that different to any other non-disclosure issue, and if consumers are dishonest, or careless with the truth, or fail to tell their insurer about changed circumstances, then the consequences are on them.

There are also very good reasons why business activity increases risk – even extra visitors to the home adds to liability concerns – and if insurers don’t want to take that on, well, that’s up to them.

But is it quite that simple?

There are estimated to be hundreds of thousands of Australians carrying out some form of business activity from home, especially since covid. And business activity can be quite difficult to define.

Recent examples highlighted by ABC News where claims have reportedly been denied or cover withdrawn include eggs being sold from an honesty box, bike repairs taking place in a garage, and a food truck parked at – but not trading from – a home address.

One broker told insuranceNEWS.com.au that a pensioner client of his was informed that continuing to sell $5 worth of eggs to his carer every month would force the cancellation of their home and contents policy.

While we may not have all sides of every story, and insurers are entitled to decide which risks they want to pass on, these articles don’t pass the all-important “pub test”. And the more stories that are told, the more this threatens the industry’s reputation.

Consumer Action Law Centre CEO Gerard Brody told the ABC that if a consumer has a policy that was never going to provide coverage, it’s “effectively junk” and insurers need to “look at the fairness of what they’re doing and come up with a better solution for their customers”.

Politicians are getting in on the act too, with ACT Independent Senator David Pocock writing to the Insurance Council of Australia, Financial Services Minister Stephen Jones and others.

“There is a real issue here,” one industry source told insuranceNEWS.com.au.

“Lots of people will be doing little business activities for modest amounts of income. I wouldn’t be surprised if ASIC turned around and wrote a letter saying ‘review your home book and let us know the extent of this issue’.

“It’s something that the industry needs to think through just to satisfy ourselves that there isn’t some great big latent systemic issue out there.”

Bringing us back down to earth is that fact that we haven’t heard about many claims being denied on this basis.

Insurers are paying out hundreds of thousands of home claims in the wake of a spate of natural catastrophes – and if flood claims were being denied en masse on the basis of undisclosed garage sales or fresh produce honesty boxes, we would surely have heard about it.

Insurers don’t appear to be actively investigating such activity, and in most cases, how would they even know about it?

The Australian Financial Complaints Authority (AFCA) says complaints about the issue are not common, pointing to only one relevant determination in recent years.

That case related to a fire caused by undisclosed jewellery manufacturing taking place in a garage.

The complainants thought it was more a hobby than a business, but AFCA pointed out that income was generated, there was a business bank account and an ABN.

Some have flagged the fact that the duty of disclosure changed on October 5 last year to a duty to take reasonable care not to make a misrepresentation.

This swings the balance slightly in favour of consumers, and means the insurer needs to ask questions clearly and specifically, and communicate to the insured the importance of answering correctly, and the possible consequences of failing to do so.

However, it may not have much impact on this issue. Answering a question about business activity inaccurately is probably going to fall foul of either duty. And the same applies to not updating a previous answer on renewal, so long as the insurer has issued the renewal notice correctly.

Contrary to popular belief, the claim would not have to be directly related to the business activity for the insurer to deny it.

But under the new duty the insurer would need to prove that a misrepresentation had occurred, that reasonable care was not taken, and that, had it known about the undisclosed matter, it would not have offered cover in the first place.

“It comes down to the basis of the insurer’s denial,” AFCA’s Senior Ombudsman General Insurance Chris Liamos tells insuranceNEWS.com.au.

“If it’s a non-disclosure or a failure to take reasonable care not to make a misrepresentation, they don’t necessarily have to prove a link between the claim and the non-disclosure.

“What we are looking at, because it’s a precontractual issue, is what would the insurer have done differently, and what’s the prejudice that they’ve suffered.

“The insurer will still need to step through how it would have affected them. If they still would have issued the policy on the same terms then they can’t deny a claim on that basis.

“If they would have charged an additional premium they can deduct that from the claim, or if they would have applied an exclusion that wasn’t applicable to the claim then there is no prejudice.”

As to how business activity is defined, AFCA would first look for definitions within the policy. If there were none, it would move to the ordinary meaning of those words.

Mr Liamos admits “it’s a difficult one” and there are some “grey areas”.

“If your kid is selling lemonade at the front door, that would be a big stretch to say that’s somehow a business.

“On the flip side, if you’ve got a situation where someone has got an ABN and a fairly large turnover they are generating from their home, that might be less controversial.

“We would be looking at what would be the ordinary consumer’s understanding of that term in the context of the policy wording. Then we would look at the specific activities of the insured that the insurer is saying falls foul of the language.”

Does simply working from home as a paid employee cause a problem? You’d think not, but can anyone afford to make assumptions?

One industry source suggests that policies may need to introduce greater clarity – and refer to specific income thresholds or activities.

And however daft some might think it is, insurers have every right to decline to cover home and contents customers due to low-level business activities, if that’s what they want to do.

“They have a commercial discretion as to what they’ll insure and under what circumstances,” Mr Liamos says.

“If they want to be strict about certain types of business they don’t want to insure then generally they are entitled to do that.”

The advice to consumers is, as ever, read the Product Disclosure Statement. If a customer is unsure about anything, they should give the insurer a call.

Don’t assume something relatively minor doesn’t matter – it might. And if something changes, they should tell their insurer immediately, and pay attention at renewal time, making sure to check that the answers previously given are still accurate.

A little extra cash can go a long way in easing the pressure as the cost-of-living rises. But it’s not worth invalidating insurance on your biggest asset.

And as far as the industry goes, prepare for more scrutiny on this issue – especially if more people decide to tell their story to the ABC.

blurred heads looking at palm trees


Why is insurance affordability so important? 

Insurance plays an essential role in the economy, and affordable insurance is central to resilient communities.

Our members recognise that access to appropriate levels of insurance cover is a crucial to supporting our communities and national economic recovery and growth.

Committed to addressing affordability

Insurers share a commitment to addressing insurance affordability and availability over the short and long-term and the ICA works closely with all levels of government and consumers to help communities understand risk and work towards practical and meaningful solutions.

Why have some premiums been rising?

Insurance prices reflect the level of risk within a given market. Different types of insurance will therefore be priced differently. 

Generally speaking, premiums tend to be lower and stable where there is competition, freely available reinsurance and known risk factors. As insurance works by pooling risk, insurers cannot have a concentrated exposure to any one source of risk and the level of premiums is one way they can manage their exposure.

In recent years, our changing natural environment has impacted the cost of insurance in parts of Australia. Catastrophic natural events have damaged or destroyed property worth tens of billions of dollars. This has been most recently visible in the Australian bushfires of 2019-20 and floods of 2021 and the increasing frequency of these events poses long-term questions for the insurance industry and the Australian community.

Reviews into insurance affordability

Two prominent reviews have taken place into insurance affordability in the last two years:

  • ACCC Northern Australia Insurance Inquiry  
  • Role of the Private Insurance Market –Independent Strategic Review: Commercial Insurance

ACCC Northern Australia Insurance Inquiry

Concentrated impact in northern Australia

Catastrophic natural events impact different parts of Australia in different ways. In northern Australia, the increasing scale and frequency of claims due to cyclones and flood has raised costs and rendered the insurance market unprofitable over a long period of time.  This focus was the subject of recent reports, including:

  • ACCC Northern Australia Insurance Inquiry(released in December 2020)

Findings of ACCC Northern Australia Insurance Inquiry 

Over three years, the ACCC conducted a wide-ranging inquiry into the supply of residential building, contents and strata insurance in northern Australia.

The final report, released in December 2020, concluded that “the higher risk of natural disasters in northern Australia is driving higher premiums” and suggested that “reforms to land use planning and building standards may offer the best hope for achieving sustainable and equitable improvements to insurance affordability in northern Australia in the future.”

Role of the Private Insurance Market – Independent Strategic Review: Commercial Insurance

An independent report was commissioned by the Insurance Council of Australia and led by industry expert John Trowbridge in collaboration with economist Michael Blythe. A draft was released in May 2021 and the final report, including 13 recommendations, was released on 20 September 2021.

The final report concluded that in the context of a hardening insurance market there is no one-size-fits-all solution to issues of affordability and availability for small business sectors, and that solutions require collaboration and goodwill between the insurance sector, the SME sector, and governments.

The Review’s recommendations broadly fall into three categories: improved engagement between insurers and the SME sector; better understanding of insurance by SME policyholders; and advocacy to government and transparency. The ICA supports all recommendations of the Review.

Submissions to the ICA

Access submissions to the ICA for the ‘Role of the Private Insurance Market –Independent Strategic Review: Commercial Insurance’

Public liability insurance

When and Why You Need Public Liability Insurance for Small Business

If you are a small business owner that makes or sells products or interacts with the general public, it is important to consider obtaining public liability insurance. Lawsuits could have a detrimental effect on any industry if a business isn’t adequately insured. 

Public Liability Insurance 

This type of insurance covers general negligence, causing injury, as a result of your business. It is designed to protect your business against claims from accidents or injuries as well as accidental damage to property owned by someone else. A business owner or sole trader is accountable for customers, suppliers and anyone else who has involvement in the business. This should not be confused with professional indemnity insurance, which covers negligence in your business’ service.

If an accident or injury occurs your business may be liable for hefty legal fees as well as covering the cost of the damage or injury caused. If you are conducting business activities in public spaces, have people visit your work premises, work at other people’s premises or even manufacture goods your business may have legal liability in the event of damage or personal injury. Public liability insurance is the best defence against property damage or personal injury. 

Examples of claims:

A small toy business makes a toy that has a sharp edge and injuries a child playing with it. The parent may then make a claim against the toy business for the injury caused by the defective toy. 

If the toy business didn’t have public liability insurance they may have to foot the bill for legal fees and any other compensation.

A shop owner cleans their floors. It is mostly dry besides a small patch. A patron then enters the store and slips. The patron may make a claim against the business in the case of injury. 

This is another example where it is important to have the correct amount of public liability insurance cover for any legal fees and compensation.

Level Of Cover

Having an adequate level of insurance cover for your business needs is vital. Many events that occur leading up to claims being made towards businesses are unforeseen. Being sued for negligence can be costly to your business and have long-lasting negative impacts. It is important to find out exactly how much cover your business needs, as some industries require a certain level of cover in order to legally operate.

The Real Cost Of Public Liability

Although public liability insurance is not compulsory, by law, in Australia, some industries and occupations require business owners to obtain a policy. Depending on where you live you may be required to have public liability insurance in order to operate. 

If you hire a public venue you may also be required to obtain a policy in order to hire the space. Public liability insurance provides you with peace of mind in the unfortunate event of an accident or injury to another person in your workspace. Not having adequate cover could have a costly effect on your business. It may be in your best interest to engage with a business insurance consultant to decipher what kind of policy would suit your business.

Engaging With A Business Insurance Consultant

Public liability insurance cover is commonly purchased with the assistance of insurance brokers who specifically specialise in business insurance. Business insurance professionals have the ability to find a policy to suit your specific needs. They have the skills to negotiate insurance policy contracts and review relevant product disclosure statements.

Business Insurance Consulting offers a highly professional service for your business liaising with insurance companies, providing you with insurance quotes and can assist in finding you the right level of cover. If you have any enquiries regarding business insurance or to discover the optimum cover for your business contact Craig at Business Insurance Consulting today.

Business insurance coverage

Why Every Business Owner Should Have Business Insurance Coverage

There are plenty of risks when it comes to running your own business. Accidents and incidents can happen from injuries to natural disasters. Having insurance to cover your business for unforeseen events is vital. 

Insurance is the optimum defence to protect your assets including business and personal. Here are important reasons why every business should consider business insurance cover. 

Maintain Your Reputation

Having adequate insurance cover can help to maintain your reputation in the business world. Professional indemnity insurance, liability insurance and workers compensation insurance can all contribute to being insured appropriately.

A business insurance consultant has the ability to assist you in deciphering the most beneficial insurance for your business needs. From the policy details to the terms and conditions a professional can analyse these factors and point you in the right direction when it comes to business insurance.

Prevent Cash Flow Loss

Cash flow is incredibly important for businesses to stay afloat during quieter periods. Something as small as machinery breakdown could impact your cash flow if your business doesn’t have access to the right insurance option. For small businesses, this business interruption could come as a major blow. 

For example, a plumber may incorrectly fix a pipe for a restaurant due to human error. If the restaurant is then forced to shut its doors for any period of time the plumber could be liable for any damages to the restaurant’s regular takings. This has the potential to ruin a business due to a genuine mistake. This only reinstates why business owners should seriously consider taking out business insurance.

Therefore finding an insurance company that offers relevant insurance for your personal business needs is key. In an adverse event, you will no longer need to utilise your business’ cash flow and can instead rely solely on your insurance cover. 

Ability To Survive If Disaster Strikes

In Australia alone, it is not uncommon to experience floods, bushfires and even storms. In the event of a natural disaster or incident, a business’ premises could be completely destroyed. That is why it is important to go through an insurance policy with a fine-tooth comb to make sure that you will be adequately covered if an incident were to occur. 

Digging into your own personal finances may not be practical in cases like these and there is always a chance of disaster striking again if you do. Therefore to be prepared and fully insured in the first place is the optimum scenario, to begin with.

Obtaining business insurance is dire to maintaining your reputation within your industry, preventing a loss of cash flow and recovering from disaster with minimal costs. There are plenty of cover options when it comes to business insurance and there is a policy to suit every business owner.

Finding the right business insurance for your needs doesn’t have to be a daunting experience. For more information about insurance cover for your business contact Craig at Business Insurance Consulting. With help from Craig, you will be able to make an informed decision and have peace of mind that you are covered for any unforeseen events.