The short answer is yes.

Unfortunately, the Australian insurance market has not yet matured in the commercial arena. We say ‘matured’ in the sense of creating insurance products for small businesses that are both easy to use and understand.

If you’re looking for home & contents insurance, comprehensive motor or travel insurance for example, you will find an infinite number of providers and options to purchase cover on the spot. And you will probably think to yourself “travel is travel is travel – I would expect to be ‘generally’ covered irrespective of who I go with” (that is, at least what I did last time!). The reason for this is that most products do basically cover the same things and are in fact, usually written in the same way.

Which brings us to insurance for small business. If you’ve ever tried to read a “Business Insurance” package policy – you probably didn’t get past the contents page which indicated another 80-100 pages to go! So even if you’re just looking for liability or property insurance for your business, chances are that you will simply not have the time to wade through 104 pages written by Suncorp or AAMI or GIO – which coincidentally, are all part of the same company (Suncorp). In addition, policy wording boffins at insurance companies will go out of their way to make sure that the damned things are as difficult as possible to understand.

Enter the ‘friendly’ broker – the best friend you’ve never had..! The friendly broker will “go out of their way” to provide you with multiple options and prices for cover. Of course, because you will pay your broker around 20% commission (built into the premium) and if you’re lucky enough, a service fee (or two!) the friendly broker will have the time to load your risk details onto their system, which will automatically retrieve quotes from multiple insurance companies.

Yes, a broker can help you assess your insurable risks – but do they really know your business better than you? Apart from merely providing a quotation service however, brokers can also provide you with some form of recourse if it turns out that your policy did not cover your risk – their professional indemnity. By law, to be licensed, brokers are required to purchase professional indemnity in case they provide the wrong advice. However, this should be a road less traveled – unless you have time and money on your hands.

So unfortunately, until someone creates a business insurance policy that is both easy to read and understand, you’re probably stuck with going through your friendly broker. Then hopefully, your insurance company will pay your claim. But hopefully, you’ve had a good experience – and we’d appreciate you telling us about it!