Many small business owners juggle their business with family commitments, and therefore have alot to protect when it comes to insurance. But statistics show many are playing a risky business when it comes to their insurance cover.
According to a 2006 survey by the Investment and Financial Services Association (IFSA), less than half of small business owners feel they have adequate insurance cover.
Matthew McCabe from Nexia Court says part of the reason is the fact insurance is often not well understood.
“One of the biggest objections I hear about insurance is that it’s too expensive. But many of my new clients didn’t know some insurance premiums were tax-deductible.”
Two types of cover that are usually tax-deductible are income protection and business expenses insurance. Together these make a good package for the business owner according to Mr McCabe.
“Income protection can cover up to 80 percent of their personal income, and business expenses insurance can take care of their fixed costs like rent and electricity. So by combining these two types of policies, the business owner can cover both their personal and work expenses. And potentially reduce their tax bill.”
Mr McCabe urges all small business owners to review their insurance needs regularly with their financial adviser.
“Your cover has to keep up with your growing business – not to mention your family. There’s no point putting it off until it’s too late.”