Small Business Basics: Insurance

Photo by J. Kelly Brito on Unsplash

So, how established does your small business need to be before you take out insurance?

Short answer, if you are generating any income from your business (note income not profit) be it a business, a hobby that you make a little money from, a side hustle or anything else from which you received financial benefit you probably need insurance.

The Defence Census 2019 indicates 7% (1,603) of civilian partners work in their own business, 5% without employees and 2% with employees. From the statistics around member relationship categorisation and accommodation we can fairly safely assume that at large proportion of these families are living in service accommodation. However DHA only has 60-70 known business operating from service residences at a time and about 30 applications to operate a business from home each year, including applications from already known businesses relocating.

We think the disconnect is that partners who may have micro businesses, service based business with no direct contact with clients or hobbies they make a little money from are not necessarily recognising themselves as businesses and/or may not want to invest the time or money in obtaining insurance which is one of the key requirements to applying to operate a business from home in a service residence.

Princes Trust Australia in Partnership with DUAL Australia recently hosted an online webinar, Demystifying Insurance for Small Business as part of their small business series. The session covered the basic types of business insurance, Public Liability, Professional Indemnity, personal accident and cyber insurance along with things to consider as your business gets a little larger. An important point to note is that depending on the size and nature of your business some aspects may be covered by your personal home contents insurance or invalidate it entirely so it is important to get advice for your particular circumstances.

Parts of this seminar will be shared by Princes Trust Australia within their support network for Enterprise Workshop alumni. If you are interested in obtaining support or advice with starting or developing your own business have a look at their website or connect with them online

https://www.princes-trust.org.au/defence-members-and-their-families/enterprise-program/

https://www.facebook.com/princestrustau

https://www.linkedin.com/company/princestrustau/

We strongly suggest that you seek independent specialist advice regarding insurance for your small business, even if you don’t think it’s large enough to be a ‘real’ business. Business insurance not only covers you when something goes wrong it can also cover the legal costs associated with any claim made against your business and if someone decides that your advice was wrong and it cost them money or your product caused harm they don’t care that you barely cover your costs or only work in your business a few hours a month. Ensuring you have adequate insurance for your business, no matter how small, just makes good financial sense 

Good Luck!

Nejula Blake
DFA Project Officer – Employment

The information contained in this post is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice.

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Defence Families of Australia

National Advocacy body for current ADF families. We are all partners of current serving members.