The report, titled 'Addressing the Small Business Insurance Challenge,' highlights several key findings:
- Impact of State Taxes and Levies: Additional charges such as stamp duty and emergency service levies can add up to 30% to the cost of insurance premiums, significantly affecting small businesses' financial health.
- Underinsurance and Non-Insurance: Rising premium costs, coupled with other business expenses like energy and labour, are causing many small businesses to underinsure or opt out of insurance coverage, exposing them to greater financial risk.
- Recommendations for Small Business Owners: The ACCI advises small business owners to engage insurance brokers to identify appropriate policies and avoid over- or under-insuring. Additionally, conducting risk audits can help mitigate exposure to threats such as cyber-attacks, workplace hazards, and physical security issues.
To alleviate the insurance cost burden, the report recommends that governments:
- Abolish unproductive taxes and levies that inflate insurance premiums.
- Initiate a Productivity Commission review into small business and insurance costs.
- Modernise civil liability laws to improve access to public liability insurance for small businesses.
- Establish a dedicated government funding body to support small businesses in enhancing their insurance literacy and risk management practices.
In summary, the ACCI's report underscores the pressing need for policy reforms to reduce the financial strain on small businesses caused by escalating insurance costs. By addressing these challenges, the aim is to foster a more sustainable and resilient small business sector in Australia.
