Connect with us
Splendour In The Grass
Byron Bay News and Weather copy
Splendour In The Grass
The Northern Rivers News
Mt Warning News and Weather copy
The Northern Rivers Weekly Advertising
Kyogle News
Splendour In The Grass
Grafton News and Events copy
The Northern Rivers Funerals
Splendour In The Grass
Byron Bay News and Weather copy
Splendour In The Grass
The Northern Rivers News
Mt Warning News and Weather copy
The Northern Rivers Weekly Advertising
Kyogle News
Splendour In The Grass
Grafton News and Events copy
The Northern Rivers Funerals
previous arrow
next arrow

Business News NSW Northern Rivers

Aussie small businesses at risk of underinsurance

Published

on

Aussie small businesses at risk of underinsurance

Aussie small businesses at risk of underinsurance

Australian small businesses are at risk of underinsurance, with a recent report showing that many SMEs have become complacent and have no protections in place if a negative event were to occur.
Only 43% of small businesses think they are fully covered from insurable business risks, according to the newly-released bonus chapter of the Vero SME Insurance Index 2022.
While this shows a level of understanding among small businesses about their cover levels, 34% said they have no plan if something bad were to happen, the survey found. Some others haven’t even thought about what might happen or simply choose to cross that bridge when they come to it.
“Small businesses seem to be generally aware that they may be underinsured however due to the additional cost of increasing coverage some may have made a choice to not look further into their cover due to price concerns,” says Jane Mason, Head of Product Channels and Risk at SME insurance platform BizCover,
“What’s worrying is that the dangers of underinsurance can leave the insured in a worse situation if underinsured or not insured at all.”
The conditions are set for an underinsurance crisis
From floods, bushfires, and the Covid-19 pandemic to supply chain issues and the rising cost of living, Australian small businesses have had to contend with multiple problems in recent years.
This has had an impact on the revenue of many businesses, causing some to look for ways to save money.
Vero’s report suggests that SMEs with declining revenue are less likely to say that they are completely covered and are also less likely to have a plan in place for a negative situation.
“It’s tough out there. And unfortunately, some businesses put their insurance on the chopping block,” says Mason. “But what this also says is that the businesses who are more likely to be hit by underinsurance are already struggling.”
Exacerbating the issue is that rising inflation and major supply chain disruptions are pushing up the claims costs for insurance companies, which ultimately results in higher premiums across some types of insurance.
This can put businesses who are renewing their coverage at the same levels as the year before at risk, as the cost of equipment, stock or machinery has, in many cases, increased beyond what they were originally insured for.
“What was adequate cover a year ago may not be adequate cover now because of the rising cost of materials,” says Mason.
The risk of underinsurance
For Aussie businesses, what all this means is that some could be left with a serious financial crisis by not having enough insurance to cover their loss.
For example, say you insure your business for $100k and a fire rips through your store destroying it. Once you factor in the cost to repair your business, the total bill comes out to $160k in damages. That’s $60k you’ll have to pay out of your own pocket.
Another way you can fall into the underinsurance trap is by triggering a underinsurance clause.
These clauses are designed to discourage businesses from purposely undervaluing their assets and are triggered by underinsuring usually by 20% under the true value.
Importantly, this occurs even if the damages fall within the insured amount.
So, in the above example, even if the damages were only $40k, your insurer will not cover that full amount if the clause is triggered despite you having $100k of cover.
“Many people may think that the insurer will cover it since the cost of the damages easily falls within the insured amount but that is sometimes not the case if the business is underinsured,” says Mason. “If you purchase below what your business’ true value is, you could become responsible for the share of the loss and not receive full payment for your claim.”
What can small businesses do?
While the current situation is tough, there are some things Australian small business owners can do to avoid being underinsured.
Regularly scheduling some time to consider your exposure to risks could help avoid problems later down the track. This will allow you to consider what risks your business is exposed to and think about the possible scenarios that could happen if you weren’t protected in the event of a claim.
“It’s important to insure your business for an amount that is sufficient to cover not only the tangible assets, but the cost of repairs and any other variables that might leave you out of pocket,” says Mason. “After that, consider jumping online to compare quotes so you could then decide whether the price of the cover justifies the protection.”
While reviewing your cover at renewal is a great time to consider your options, you could check in at any point throughout the year.
And with inflation and the cost of claims rising, it’s become even more crucial to regularly keep track of the actual value of your building and business contents to avoid being left with inadequate cover if a claim were to arise.

Splendour in the grass

Business News

Small business sector, including agriculture, now enduring ACCC priority

Published

on

By

ACCC priority

Small business sector, including agriculture, now enduring ACCC priority

 

The Australian Competition and Consumer Commission (ACCC) recently unveiled its compliance and enforcement priorities for the 2024-25 period, marking a significant shift by including protection for small businesses, including agriculture, as a steadfast focus for the first time.

In alignment with its commitment to upholding competition and consumer laws and small business industry codes of conduct, the ACCC is dedicated to ensuring that these safeguards extend to small businesses and the agriculture sector.

Furthermore, the ACCC will prioritise addressing competition, fair trading, consumer protection, and pricing concerns within the supermarket sector, with a specific emphasis on food and groceries during the 2024-25 period.

This renewed emphasis on the supermarket sector arises from notable price hikes observed in food and groceries, coupled with the expressed concerns of Australian consumers and farmers regarding supermarket pricing practices. In response to these concerns, the government issued a directive in January for the ACCC to conduct a comprehensive 12-month price inquiry into competition within the supermarket and grocery sector. This inquiry tasks the ACCC with conducting a detailed examination of supermarket pricing practices and investigating the relationship between wholesale prices, including farmgate prices received by farmers, and retail prices charged by supermarkets to consumers.

Additionally, addressing unfair contract terms in consumer and small business contracts remains a key enforcement priority for the ACCC. The introduction of penalties for unfair contract terms has prompted proactive adjustments by numerous businesses to their standard form agreements.

A concise summary of the ACCC’s priorities for the 2024-25 period is available on the ACCC website at 2024-25 Compliance and Enforcement Priorities.

 

For more business news, click here.

Splendour in the grass
Continue Reading

Business News

PROSPECTA UTILITIES STRIKES $8M DEAL FOR WORLD-FIRST TECHNOLOGY

Published

on

By

(L-R) Prospecta Utilities Chief Executive Officer Mark Langdon and GemLife Director and Chief Executive Officer Adrian Puljich - 5G mm wave fixed wireless access network technology

PROSPECTA UTILITIES STRIKES $8M DEAL FOR WORLD-FIRST TECHNOLOGY 

 

A Queensland family that transformed the land lease industry is moving into the communications and renewable energy space, with an $8 million investment in world-first 5G mm wave fixed wireless access network technology.

The Puljich family, behind the 3072-home GemLife and Living Gems portfolios, is bringing the disruptive technology to Australia under its new business, Prospecta Utilities.

Challenging fibre-to-the-premise offerings and traditional telecommunications providers, it will allow non-carriers to establish their own enterprise networks.

Prospecta Utilities has struck a deal with American software and hardware provider Airspan Networks Holdings for the first 500 units of the ground-breaking AIR5G 7200 5G radio technology, a stand-alone solution that can network multiple homes, devices and technologies enabling intelligent cities.

GemLife resorts will be the first in the world to access the new technology, with a pilot of 97 homes at GemLife Tweed Waters in the first quarter of 2024, before it is deployed across all 14,000 existing and future homes across the 30 resorts in the portfolios by 2028.

Prospecta Utilities is also in discussions with developers and asset owners across the multi-residential, retirement, commercial, retail, industrial, agricultural, sports, education and private health spaces to install the new technology, which is available across three offerings to suit various applications.

Prospecta Utilities chief executive officer Mark Langdon said the technology was a game changer in Australia and internationally, offering a future-proof alternative to traditional networks.

“This new technology delivers fast, low-latency and reliable connectivity at speeds up to 2GB per second, while providing a cost-effective solution and future readiness,” he said.

“While traditional fibre services Wi-Fi only, radio networks allow connection to various devices and technologies, redefining the way industries like logistics, warehousing, transportation, agriculture, renewables and manufacturing manage robotics and advanced equipment.

“Its ability to enhance automation and digital transformation improves operational efficiencies and drives growth, with its applications only set to increase as new technologies get up to speed.

“In a fast-evolving technological environment, it is capable of servicing a future that doesn’t yet exist, with innovative businesses investing now poised to have the first-mover advantage.”

(L-R) Prospecta Utilities Chief Executive Officer Mark Langdon and GemLife Director and Chief Executive Officer Adrian Puljich - 5G mm wave fixed wireless access network technology

(L-R) Prospecta Utilities Chief Executive Officer Mark Langdon and GemLife Director and Chief Executive Officer Adrian Puljich

GemLife Director and Chief Executive Officer, Adrian Puljich, said continuous innovation was vital for all businesses operating in the modern environment, including its GemLife and Living Gems resorts.

He said the new technology would ensure a quality experience for its residents and the operational efficiency of the land lease communities.

“We see the opportunity to connect amenities and infrastructure in our own resorts to improve systems and experiences, from irrigation sensors that enhance sustainability by only watering when required to automated buggies to transport residents and a digital concierge and fully integrated energy management,” he said.

“Investing in private enterprise networks future proofs our resorts, meaning our offerings for residents can easily evolve alongside emerging technology, using advancements to enhance lifestyle and well-being.

“In the immediate term, residents will enjoy seamless internet connection to their homes, at a more affordable rate. Connecting each home to this technology is about 40 per cent cheaper than traditional fibre.”

Mr Puljich said the technology would also offer environmental and safety advantages during construction of the resorts, with plans to deploy the network as its 553-home GemLife Moreton Bay resort in South-East Queensland came to life.

“During construction, we’ll be able to use the technology to monitor safety and air quality, by networking individual machinery, tracking UV exposure levels for our workers and dust levels,” he said.

Prospecta Utilities is also making headway in the renewable energy sector, offering customised Virtual Power Plants (VPP) to better utilise solar power, reducing running costs and providing lower electricity bills for homeowners.

That technology has already been rolled-out across several GemLife resorts, which are now up to 90 per cent energy independent while saving residents more than 60 per cent on their power bills.

 

For more business news, click here.

Splendour in the grass
Continue Reading

Business News

Why Do SMEs Struggle to Scale Up?

Published

on

By

SMEs

Why Do SMEs Struggle to Scale Up?

 

By Jeff Gibbs

A defence industry executive recently posed a compelling question: why do so many SMEs in the defence sector, and across industries globally, plateau or sell after reaching a certain size, typically around 15-20 staff and $5 million in revenue? This observation resonates deeply, highlighting a widespread challenge in SME growth.

One significant reason behind this stagnation is the lack of long-term planning among business owners. While many start with aspirations for growth, they often fail to strategies for the future, limiting their potential. Some entrepreneurs opt to maintain their business at a certain scale to support their lifestyle or preserve a legacy, rather than seizing growth opportunities.

This tendency to remain small has broader economic implications, particularly in reducing economic complexity. Without more SMEs scaling up, countries struggle to develop diverse industries. This issue is particularly pertinent for Australia, were economic complexity lags behind other developed nations. Amidst economic challenges, SMEs require support to overcome stagnation and foster growth.

SMEs

So, what can be done to break through this stagnation?

  1. Embrace a Growth Mindset: Business owners must commit to growth and adopt a proactive approach. Governments can support this by fostering a growth-oriented culture through education and providing incentives for expanding companies.
  2. Define Growth Objectives: It’s crucial for businesses to clearly articulate their growth objectives and envision the future state of their organisation. This includes setting specific goals, identifying target markets, and determining resource needs.
  3. Delegate Responsibilities: Entrepreneurs must recognise the importance of delegation and building a capable team to support growth. By relinquishing control and empowering others within the organisation, businesses can navigate growth more effectively.

Ultimately, when SMEs transcend their growth barriers and evolve into larger entities, the entire economy benefits from increased diversity and prosperity. It’s incumbent upon us to inspire SME owners to choose growth, thereby creating jobs and fostering a robust economy for future generations.

 

For more business news, click here.

Splendour in the grass
Continue Reading

NRTimes Online

Splendour in the Grass

Advertisment

National News Australia

Latest News

Verified by MonsterInsights