Businesses are all risk-prone and require business insurance. They face different types of risks from various sources, for various reasons. While, some risks are trivial or manageable, others can result in severe loss or even bankruptcy.

Some of these risks are enlisted below,

Physical and intellectual risks

Business’s unspoken rule says that every asset of the company is an equal liability as well. For example, a company’s human resource is its biggest asset and their well-being, its biggest liability. The workforce of the company requires complete attention from the company in order to ensure their well-being.

You might be the owner of a transportation business, textile mill, cleaning business, IT industry, etc. but the one element of all businesses is their workforce/labors/workers/employees. However, the business activities vary and so does their risks.

Cleaning business insurance sydney includes cleaning glasses and high building windows. Carelessness or minute negligence may result in severe physical injuries or may also prove to be fatal. A cleaner may fall off a window and lose his right leg, glass may injure his arms, and any permanent injury may lead to emotional and intellectual injury.

Take another example of a textile mill where a worker may lose his life leaving behind a family that needs care. Accidents are highly probable in transportation of goods.

Psychological injuries like stress, anxiety, and depression are very common among IT workers with hefty working hours, heavy work pressure, stress-instilled atmosphere, cutthroat competition, and unhealthy company atmosphere. Bullying and harassment cases are also not much uncommon in present-day scenario.

While, you as an owner or manager may volunteer to take full responsibility of your staff, you simply cannot. Rationally,

  1. Not all workers are confined to work at sight-distance or inside the company premises
  2. It is impossible to keep a minute-based report of everyone
  3. External risks

 Risk management

Companies and businesses either are held liable in case any worker is injured on company premises or while executing any business activity. Such liability cases are very common and result in heavy expenses. Therefore, it is important that the company use the management that is available – worker’s compensation insurance. This covers the cost of medical bills, hospital bills, lost wages, and compensation.

Preventable and non-preventable hazards

Perils and natural disasters are a common threat to all businesses. These include preventable perils like fire, as well as non-preventable disasters like flood, and earthquakes.

Preventable hazards are not completely inevitable. Such perils lead to loss of property, loss of finance, loss of documents, equipments, and technology. Altogether, without any careful measure, the business will be bankrupt and destroyed if any of these perils struck it.

Risk Management

Businesses are offered,

  1. General property insurance,
  2. Fire and peril insurance.

General property insurance covers loss of tools of trade or profession, stock in trade and office contents, whether they are at or away from the premises.

Fire and peril insurance covers the damage to buildings or contents by fire, lightning, explosion, malicious damage, earthquakes, storm, and water. Most fire and perils policies do not cover you for flood damage caused by overflowing watercourses e.g. rivers.


It is important that a company pays attention to the kind of premises and locality it is located in. The locality will determine the safety against perils, burglary, robbery, and theft.

However, it is essential to make sure that the safety of the business is not compromised under any circumstances.

Risk Management

Coverage for burglary under business insurance covers theft involving violent, forcible entry, loss, or damage to stock, goods held in trust and all contents for which you are responsible within the premises. It does not normally cover theft by employees or others entitled to be on the premises.

Business vehicles, equipments, and technology

If a business is dealing with transporting goods, heavy machinery, or technology; possibly it relies on them. Therefore, any damage or breakdown is certain to result in business interruption.

For example, the textile mill will rely heavily on its mill and machinery. In case, the machinery breaks down, the business will be interrupted for as long as the machinery is not repaired or replaced. In addition, the repairing and replacement will also require money.

It is usually difficult for businesses (especially small businesses) to recover quickly. The entire monthly budget is affected. Therefore, to avoid such situations, it is required by the company to take advanced precautions.

If the business involves vehicles, say transportation of goods or products, the vehicles play eminent role.

If it is IT business, the computers and laptops will be valuable in every day routine to execute basic activities.

Risk Management

Businesses are offered,

  1. Commercial vehicle insurance
  2. Engineering equipment insurance

Third party safety

If your business is regularly dealing with third party, like,

  1. Customers
  2. Clients
  3. Partners

Then you are liable for any physical damage that is suffered by them while they are on your business grounds.

Angry third party may also try to sue your business if,

  1. Your business leads to their financial loss
  2. Your business loses their personal information
  3. If any confidential information is compromised
  4. Your business product/service leads to their intellectual loss

Risk Management

This is the most common basis of lawsuits and claims against businesses. This may result in,

  1. Loss of finance
  2. Loss of repute
  3. Loss of customers

Therefore, businesses are suggested business insurance that covers the business against compensations, and lawsuit expenses.

Professional Indemnity insurance covers your business when it provides the customer a questionable advice, leading to financial loss.

Product liability insurance covers claims of goods causing injury or damage. If you sell, supply or deliver goods, even if you repair goods or supply them as a service.

Public liability insurance covers third parties suing you for personal injury or property damage they sustain while on your property if you are negligent.

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