What are your thoughts on business insurance?
Everyone in business understands the importance of insurance to mitigate risk and in many cases, meet licensing requirements. Being denied insurance cover leaves small business owners exposed, with many forced to limit services, or close completely.
With a focus on recovering and rebuilding our post-COVID economy, those of us who work with small businesses every day understand that it is essential to remove unnecessary barriers to business continuity.
Over the last few months at the SBDC, we have heard from a growing number of small businesses who have either been denied insurance, been subject to unsustainable increases in premiums or had their coverage reduced without consent — through no fault of their own. Business owners from a range of industries including adventure tourism operators, already suffering the substantial impact of travel restrictions, have asked for us for help with this distressing situation.
As a result, and with the support of the Minister for Small Business, we conducted preliminary investigations into the issue and reported our findings to the State Government as well as the Australian Small Business and Family Enterprise Ombudsman (ASBFEO), Kate Carnell.
In response to our advice as well as approaches from small businesses around Australia directly to ASBFEO, the Ombudsman has launched an inquiry to investigate the practices of the insurance industry that impact small businesses and consider whether small business insurance products are fit for purpose.
Specifically, the insurance inquiry will investigate a range of issues including:
- The availability and coverage of insurance policies provided to small business
- Insurance policy affordability
- The role of brokers in getting the right coverage
- Contract changes that have not been agreed to and whether they amount to unfair contract terms
- Timeliness of insurance payouts and the effectiveness of dispute resolution frameworks
- The effectiveness of relevant codes of conduct and legislation, including whether applicable penalties are adequate
This is a critical issue for small businesses in WA and across the rest of Australia and we want to hear from you. If you have faced any difficulties with your business insurance, I encourage you to complete the online survey or email ASBFEO with information about your experience.
We need to do everything we can to level the playing field and let our small businesses get on with business so that our state and nation can get back to economic prosperity. I am looking forward to receiving the inquiry report, which is expected to be released at the end of the year.