Personal Insurance Types

Small Business Public Liability Insurance
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There’s no doubt that public liability is one of the most popular forms of insurance around, but there other forms of cover which business owners need to consider.

Putting business insurance aside completely, in this guide we want to take a look at the forms of personal insurance which can assist small business owners and their families.

What are these covers? Who needs them? What are the benefits? How much do they cost? These are all questions that we will look to answer.

Personal Insurance for Business Owners

Most business owners understand the importance of insuring their business with public liability as well as other forms of property cover, but fewer worry about insuring themselves personally.

Depending on your business structure, you may not have access to sick leave or worker’s compensation, so if you can’t work for a period of time you could end up in financial strife.

Thankfully there are forms of personal insurance which can protect you and your family, and we will go into the four major forms of cover in more detail below.

Life Insurance

This is the most common form of personal insurance for small business owners, as well as for the general public in Australia.

The concept of life insurance will be very familiar to most people. It simply pays a lump sum to your family in the event of your death, and with most policies also upon diagnosis of a terminal illness.

As a small business owner you may have considerable debts attached to your home and business, so it is important to ensure your family is not burdened with these debts after your death.

If your business has been particularly successful your family may have become accustomed to a certain lifestyle. If they won’t be able to sustain that lifestyle financially without you around, this is another area that could be managed with life insurance.

Income Protection

Whilst life insurance is the most common, income protection is arguably the most important.

Income protection can replace up to 75% of your usual income if you are unable to work for a period of time due to injury or illness.

If your business won’t be able to keep paying you an income whilst you can’t work in the business, the only thing that will look after you financially in most cases is income protection.

Trauma Insurance

Trauma insurance has a fairly low rate of take-up in Australia compared with other developed countries, but it is becoming increasingly popular as more people become aware of it.

This form of insurance pays a lump sum in the event of suffering a critical illness or event such as a heart attack, stroke or cancer.

Trauma cover has proven popular with business owners who want to ensure any critical illness is going to have as little of a financial impact as possible on their future plans.

TPD Insurance

Most Australians will have total and permanent disability insurance (TPD) through their superannuation fund, but few people actually know what it is or if they have enough.

TPD will pay a lump sum amount in the event that you become totally and permanently disabled and can no longer work.

If a TPD event was to leave you unable to keen working in your business, the proceeds could be used to help with transitioning into a different role or moving into some form of retirement.


As a small business owner there are dozens (if not hundreds) of different areas competing for your hard earned dollars. So the question is, does personal insurance deserve some of that money?

You’ve worked hard to build up your business, but an unexpected major illness or injury could derail your financial goals very quickly.

Insurance can’t stop the event from happening, but it can make the financial consequences a lot easier to deal with.

All business owners, large and small, should at least speak with a financial adviser about how insurance may be able to help them to protect what they’ve built.