It is good practice for companies to have insurance policies in place in respect of their business activities in Australia. The most common types of insurance include:
- Workers compensation: this is compulsory for most businesses in Australia and covers claims for workplace-related injury or disease;
- Professional indemnity: this covers any civil liability for breach of a duty owed in a professional capacity in connection with the company's business;
- Public liability: this covers circumstances where a company may be found liable to a third party for death or injury, loss or damage of property or 'pure economic' loss resulting from the company's negligence;
- Product liability: this covers damage or injury caused to another business or person by the product that a company is selling or a failure of that company; and
- Directors and Officers: this covers claims from allegations against directors and officers of a company of wrongful acts whilst acting in their capacity as a director or officer.
It is prudent for a foreign company that wishes to conduct business in Australia to determine whether its existing insurance is sufficient to cover its Australian business activities or whether a new insurance policy needs to be obtained. Most banks and other organisations will require that a business has appropriate insurance in place with a reputable insurer before contracting with it.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.