Why does your business need to consider Statutory Liability insurance?
As a business owner in New Zealand, you are probably already aware of the many different types of laws and regulations which are in place. These are there to help create a safe working environment and impact many different types of business operations.
If these laws are breached then there is the reality of being faced with a fine or penalty, something which business owners and directors can be held personally liable for.
When you run your own business, it is important that you are aware of the different regulations which may affect your business. Health and Safety at Work Act Regulations are particularly important if you have a team of staff working for your business.
The unfortunate reality is that accidents and incidents can happen even in the safest of working workplace environments. If you are found negligent or in breach of these regulations, the penalties could have a disastrous impact on your business.
Incidents like an employee potentially injuring themselves at work is something no small business owner wants to be faced with and can happen in the blink of an eye. Slips, trips, falls and other workplace hazards can occur even in the safest of work environments^.
Having a risk management plan in place is one step you could potentially create to help your business be better prepared and ensure that it is complying with all the applicable laws within the workplace. This is something you may also want to educate and share with your employees.
Statutory Liability Insurance For Your Business
New Zealand businesses are facing increased exposure to statutory fines and penalties handed down for breaches of legislation, with businesses, directors, and those in managerial positions being held more accountable and responsible for their actions in the workplace.
Statutory Liability Insurance protects you, your business and your employees, including directors, trustees and managers, against certain unintentional breaches of New Zealand Acts of Parliament. It covers the costs of representation in investigations for alleged breaches affecting commercial businesses, as well as defence costs, and fines or penalties payable following conviction for an offence under an insured statute.
What is Statutory Insurance*?
Statutory Liability Insurance protects you, your business and your employees, including directors, trustees and managers, against certain unintentional breaches of New Zealand Acts of Parliament. It covers the costs of representation in investigations for alleged breaches affecting commercial businesses, as well as defence costs, and fines or penalties payable following conviction for an offence under an insured statute in situations where the fines or penalties are permitted to be paid at law.
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What does Statutory Insurance cover?
Statutory Liability insurance is there to provide the financial protection for your business when it is faced with a claim. These are some of the key areas that Statutory Liability insurance covers:
- Defence costs associated with alleged breaches of statutory acts affecting commercial activities
- The costs of representation at an investigation or inquiry
- Fines or cash penalties payable by the insured following conviction for an offence under the insured statutes (unless the said Act forbids any fines and penalties to be insured)
Statutory Liability Claim Examples
This is a quick overview of some of the different types of claims where Statutory Liability insurance may provide protection to your business:
- Investigations by the Commerce Commission
- Investigations of workplace injuries
- Environmental breaches, such as unintentional discharge of waste into public watercourse
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What’s at risk if you don’t have Statutory Liability insurance?
Like other business insurances, they are designed to safeguard and protect your business from certain risks. Not having Statutory Liability insurance in place can potentially create added risk, worry and stress as business owner. If a claim were to occur, your personal finances could be in jeopardy to not only pay the compensation if awarded but the associated legal costs too.
Not only is there the financial side of things to consider, but also the potential damage to your business’ reputation, something you have worked long and hard at building.
These factors combined with the time spent away from your business to deal with the claim are all elements which could potentially see you closing your business doors for good. That’s why Statutory Liability insurance is there to give you peace and mind and protection.
How much does Statutory Insurance cost?
There isn’t a one-size fits all price when it comes to Statutory Liability insurance policies. Each and every business is different with its own exposure to potential risks. Factors like the number of staff and the type of work your business conducts can impact the pricing of your policy.
To find out how much Statutory Liability insurance may cost your business get a quote today
What is the difference between Professional Indemnity and Statutory Liability Insurance*?
These two types of insurance are designed to cover different risks that your business may face.
Statutory Liability insurance protects against certain unintentional breaches of New Zealand Acts of Parliament.
Professional Indemnity insurance is designed to respond to claims against your business for losses as a result of actual or alleged negligent acts or omissions in the provision of your professional service or advice. PI Insurance will also assist with the legal costs associated with responding to or managing claims which are covered by the policy.
What is the difference between Statutory Liability insurance and Public Liability insurance?
Public Liability insurance is intended to protect against different risks than what Statutory Liability insurance is designed for.
Public Liability insurance is designed to provide protection for you and your business in the event a customer, supplier or a member of the public are injured (and not covered by the Accident Compensation Commission (ACC) or sustain property damage as a result of your negligent business activities.
What is covered?
- Compensation for accidental damage to third party property
- Compensation for personal injury or death to third parties where the ACC does not provide cover
- Legal and defence costs
What is typically NOT covered?
- Injury to your employees
- Damage to your own property
- Compensation for personal injury whereby cover is provided by the ACC
- Known claims and circumstances
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* This information is a general guide only and does not take into account your objectives, financial situation or needs. As with any insurance, cover will be subject to the terms, conditions and exclusions contained in the policy wording. The information contained on this web page is general only and should not be relied upon as advice.
^The provision of the claims examples are for illustrative purposes only and should not be seen as an indication as to how any potential claim will be assessed or accepted. Cover for a claim will depend on the specific circumstances around the loss and would be subject to the terms and conditions of the policy concerned.
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