So, here are 5 reasons why you should disclose business activities.

1 – To ensure you’re covered

Just because you have an insurance policy for your business, it does not mean your policy automatically covers you for everything. So, a ‘she’ll be right’ attitude can have a significant financial impact that can delay or prevent you from achieving long-term business growth.

2 – Disclosure of business activities is a wise investment

Insurance is only as good as the information you provide. So, the more business activities you withhold to save money, the riskier your business future becomes.

While the cost of premiums can seem expensive, they are small compared to the cost of any legal defence fees and financial penalties you may incur.

In today’s litigious environment, no business relationship is free of risk. You may encounter unforeseen problems with employees, suppliers, investors, competitors, customers, government agencies, regulators, and creditors.

Proclaimed as one of Australia’s oldest insurance companies, the closure of Catholic Church Insurance may leave churches across Australia without adequate insurance and increase their exposure to risk while they find a new insurer.

However, all is not lost. The closure heralds the opportunity for religious organisations to review their existing insurance programs. It’s a chance to explore the market for insurance solutions that may better suit their specific needs.

So, for churches affected by the change, here are 5 ways insurance brokers (otherwise known as insurance advisers) can provide professional risk and insurance advice to support the transition to an appropriate insurer.

5 ways Insurance Brokers can help:

1. Gain Clarity on Risk

While Catholic Church Insurance winds down there may be time to take stock. Talk to your insurance broker and ask them to evaluate your risk exposure against your current insurance program.

It will help you to better understand your risk appetite and whether your existing program meets your needs. You can decide which risks to keep, mitigate or transfer to insurance.

2. Gather Accurate Valuations

With a move to another insurer, it’s a good time to gain accurate valuations. With accurate asset insurance replacement valuations, insurers can underwrite your risks with greater accuracy.

Your insurance broker can signpost you to the most appropriate and certified insurance assessors.

3. Update Business Continuity Plans

Clarity on risk exposure will help you to ensure you have appropriate plans in place to keep operating. Whether it’s an IT breach, weather event or other claimable event, a business continuity plan will ensure you know what to do and who to contact to keep servicing your community’s and congregation’s needs.

4. Build Insurance Programs That Meet Specific Needs

Insurance brokers are experts in risk and insurance advice. In fact, they understand which types of insurance a Catholic Church or other religious organisations need and can advise on the most appropriate risk and insurance program for your needs.

Your broker will work with you to evaluate your business risks and advise on the insurance solutions available. Their advice can help you decide which risks to transfer to insurance.

5. Ongoing Advice and Claims Support

Insurance is a contract, like any other. Therefore, there are duties to declare potential claims and changes in circumstances. Changes could include contracts, events, youth programs, community outreach programs, fundraisers, new assets and more.

Your broker will act on your behalf by advising your insurers when you notify them of changes. Additionally, they can explain any impact your future plans may have on your insurance.  For example, you may need an additional policy if your activities are not covered by your policy.

In the event of a claim, your broker can advise on what to prepare and negotiate with insurers on your behalf.

Does your religious organisation need advice on transferring to a new insurer?

Clear Insurance offers a risk and insurance review on a fee-for-service basis. The review will assess your existing insurance program against your operational risks and provide a detailed gap analysis that enables you to make informed decisions about whether to keep, mitigate or transfer your risks to insurance.

If you would like to discuss your insurance program or ask about a risk and insurance review, you can call Clear Insurance on 1300 721 132 or complete our online enquiry form and an experienced adviser will be in touch.

Under the Corporations Act 2001 (Cth), all company directors in Australia have statutory duties that apply whether the role is voluntary or paid. Breaching those duties can carry serious personal consequences: civil penalties, criminal charges, disqualification from managing corporations, and personal liability for company debts.

Here are five director duties every Australian director should understand, and why having the right insurance program matters alongside them.

Five director duties Under Australia’s Corporations Act

1. Act with Care, Skill and Dilligence

Section 180 of the Corporations Act requires directors to exercise their powers with the degree of care and diligence that a reasonable person in the same position would exercise. This is an objective standard: it is not lowered because a director is inexperienced, unpaid, or part-time.

In practice, this means:

• Staying informed about the organisation’s operations, financial position, and key risks
• Attending board meetings and engaging meaningfully with board papers
• Seeking professional advice when needed, and genuinely understanding that advice before acting on it
• Asking questions when financial reports are unclear or incomplete
• Maintaining independent scrutiny even when decisions are delegated to management

Directors who simply rubber-stamp management decisions (without questioning, understanding, or pushing back where warranted) are exposed under this duty.

A Directors and Officers (D&O) policy can respond to claims alleging a director failed to act with the requisite care, skill, or diligence, including class actions and regulatory proceedings brought by ASIC. Cover may apply to the defence costs and any damages awarded, subject to the policy terms.

2. Act in Good Faith in the Best Interests of the Company

Section 181 requires directors to act in good faith in the best interests of the corporation and for a proper purpose. The duty is owed to the company as a separate legal entity. However, acting in the company’s interests generally aligns with the collective interests of shareholders as a whole, not as individuals.

Common situations that test this duty can include:

• Conflicts of interest: If you have a personal interest in a matter before the board (for example, a family member’s business is tendering for a contract) you must disclose that interest to the other directors under section 191. What happens next depends on your company type and the requirements set out in the Act.
• Related party transactions: Arrangements between the company and people or businesses connected to a director must be on arm’s length terms, meaning the same terms you would negotiate with an unrelated third party in an open market. Member approval may be required.
• Competing interests: A director must not put their own interests, or the interests of a parent company or major shareholder, ahead of the company they are directing. The company comes first.

D&O policies can cover allegations that a director acted improperly or in their own interest rather than the company’s, including the cost of defending those allegations before any finding is made.

3. Proper Use of Your position and information 

Sections 182 and 183 of the Corporations Act prohibit directors from improperly using their position, or information obtained through their role, to gain a personal advantage or to cause detriment to the company.

Examples of conduct that can breach these duties:

• Using confidential company information to set up or assist a competing business
• Directing company contracts or opportunities to personally connected parties for personal gain
• Selling assets to the company at above-market prices, or purchasing company assets at below-market prices, for personal benefit

Importantly, these duties survive your time as a director. Information obtained while you were serving cannot be misused after you resign.

D&O policies can cover the cost of defending allegations of improper use of position or information. However, section 199B of the Corporations Act prohibits companies from paying insurance premiums covering actual wilful breaches or conduct involving improper use of position or information. The distinction matters: the policy defends the allegation; it does not pay if deliberate wrongdoing is ultimately proven.

4. Prevent Insolvent Trading

Section 588G of the Corporations Act is one of the most serious duties in Australian corporate law. It prohibits a director from allowing the company to incur a debt when the company is already insolvent, or when taking on that debt would cause insolvency.

A company is insolvent when it cannot pay its debts as and when they fall due. Directors must:

• Monitor the company’s financial position on an ongoing basis, not just at year-end
• Understand the company’s cashflow, working capital position, and upcoming obligations
• Act immediately if there are reasonable grounds to suspect the company may be insolvent or heading that way
• Seek independent advice from an accountant or insolvency practitioner early, not after the position has deteriorated further

Standard D&O policies do not cover the personal liability arising from insolvent trading itself, as this is a pecuniary penalty or compensation order. However, D&O may cover the costs of defending insolvent trading proceedings, which can be substantial even when a director ultimately avoids a finding of liability.

5. Maintain Accurate Financial Records

Directors are personally responsible for taking all reasonable steps to ensure the company keeps the accurate financial records. This is not an obligation you can simply delegate and forget about.

Records that must be maintained include:

• Financial statements prepared in accordance with accounting standards
• Source documents including invoices, receipts, contracts, and bank statements
• Minutes of board meetings and resolutions
• Registers of members, options, and charges

Directors should satisfy themselves that the company has appropriate accounting policies, internal controls, and approval processes in place. If financial reports are unclear, ask management or the auditor to explain them; do not simply sign off.

Poor record-keeping is a contributing factor in many D&O claims. Well-documented decisions, board minutes, and financial oversight processes are both a legal requirement and a practical defence.

Insurance Protection for Australian Directors

Even directors who observe every one of these duties can face claims. Allegations of mismanagement or breach of duty are costly to defend, regardless of outcome. The personal financial exposure is real, and it does not disappear because you acted in good faith.

What D&O Insurance Covers

A Directors and Officers (D&O) policy covers claims alleging wrongful acts in a director’s management capacity. Australian policies typically provide three layers of cover:

• Side A: Covers individual directors directly when the company cannot or will not indemnify them, which is the most important protection for personal assets, especially if the company becomes insolvent.
• Side B: Reimburses the company when it has indemnified a director or officer for a covered claim.
• Side C: Covers the company itself for securities claims. More common in listed company policies.

D&O policies operate on a claims-made-and-notified basis: the policy in force when a claim is first made is the relevant policy, not the policy in force when the alleged act occurred. Maintaining continuous cover and notifying your insurer promptly are both critical.

The Limits of Company Indemnification

The Corporations Act restricts what a company can do to protect its directors financially. For example, under section 199A, a company cannot indemnify a director against:

• Liabilities owed to the company or a related body corporate
• Pecuniary penalty orders or compensation orders under the Corporations Act
• Liabilities to third parties that arose from conduct not in good faith

Under section 199B, a company cannot pay insurance premiums covering a director’s liability for wilful breaches of duty (except legal costs), or improper use of position or information.

That means, D&O insurance does not shield you if you deliberately act dishonestly or wilfully breach your duties. It can fund the defence of allegations, which is where most of the value lies.

Reviewing Your Director Protection Program

Clear Insurance advises on insurance programs that protect both the business and the individuals who run it. Contact us on 1300 721 132 or submit our enquiry form. Our risk and insurance review is a no-obligation way to check whether your current program reflects the risks your directors face.

Employment risk is a critical consideration for any business that employs staff. Therefore, management liability insurance is a good starting point.  In fact, there are many components to management liability insurance that serve to protect your business, including:

• Employment Practices
• Crime
• Defamation
• Directors and Officers
• Tax Audit
• Statutory Liability

Today we are looking at what’s commonly referred to as employment risk. Critically, employment risk generally falls within management liability insurance under the category of employment practices.

Thus, to help establish whether you need employment practices liability cover, our advisers ask critical questions to assess your employment liability risk, including:

• How does your business manage employment contracts with your staff and contractors?
• Do you outsource Human Resources (HR) requirements to HR consultants?
• Does your company have an internal human resources team or manager?
• Are you self-managing human resources?

Why should I consider employment issues as a business management risk?

In today’s litigious society, companies risk unhappy employees, former employees or a third party taking legal action against the company or its officers.

Furthermore, legal action can arise for several reasons, including unfair dismissal, discrimination, harassment, or other employment practices that may be deemed illegal or inappropriate.

Therefore, it’s vital to note that the threat of legal action on employment grounds is not exclusive to directly employed staff. For example, consultants, sub-contractors, and contractors engaged by your company may take legal action against your company on employment grounds.

How do I mitigate employment risk?

Keeping abreast of the changing rules and regulations regarding fair work and employment practices can be challenging – particularly if you self-manage employee relations.

A human resources specialist can help you develop the most appropriate policies and procedures to protect staff and your company. Specifically, they can help create a safe working environment that also protects staff attending external meetings or site visits outside your premises.

Nonetheless, you may wish to transfer some or all financial employment risks to insurance for complete peace of mind.

How can Clear Insurance help you with employment risk?

We use our extensive risk and insurance knowledge to help you navigate the full suite of management liability insurance products. In other words, we guide you through the pros and cons of each to help you choose the most appropriate insurance solution for your needs.

With our fee-for-service approach, you can feel confident that our fee is calculated based on the insurance services you receive rather than the policies themselves. Thus, reducing the taxes payable on your premiums.

If you would like to discuss your insurance program with an experienced adviser, you can contact Clear Insurance on 1300 721 132 or complete our online enquiry form. 

Therefore, having a strong grasp of the business management risk for your operations is critical. While last week we considered the impact of defamation, today we’re looking at what’s commonly referred to as crime risk.

The critical question for crime risk that our advisers will ask you is:

• Are you 100% confident that your business is not open to the theft of funds, inventory or intellectual property?

So, to help you answer this question, we use our risk and insurance expertise to take you on a risk discovery journey. During which, we’ll work with you to analyse financial data, growth plans and operations to see what level of risk your company can support.

Why should I consider crime as a business management risk?

Today, the risk of a business falling victim to crime continues to grow and can be distressing for all involved. So, a ‘she’ll be right’ attitude to save money can be costly for your business.

Nevertheless, you may feel that you have the necessary protocols and policies in place to mitigate crime risk. What’s more, you have complete faith in your employees. However, theft can happen in the most unlikely and unexpected ways.

Examples of crime:

Dealing with company insurance programs and insurance claims daily, we encounter many examples of business theft. So, here are a couple of ways crime can occur within a business:

• Distressing family circumstances lead a trusted employee to embezzle funds to help cover critical family issues or addictions over a long period.
• A trusted employee takes products to sell or use outside of the business for financial gain.
• A senior employee or contractor uses your intellectual property outside the business or shares the details with competitors.

As you can see, while we trust our employees, the circumstances can quickly change.

Today, it is becoming harder to feel 100% protected against the risk of crime. However, with the comfort of the most relevant insurance products you can gain peace of mind.

How do I protect my company from business management risk?

There are ways you can mitigate business management risk. Therefore, it’s vital to seek advice from professional advisers such as risk and insurance advisers, human resources specialists, legal advisers, and accountants who can assess your operational procedures and insurance programs to ensure they’re sound.

There is a suite of management liability insurances available to businesses. However, the devil is in the detail, and insurance products can vary substantially. So, it’s vital to have a clear understanding of your insurance program.

How can Clear Insurance help you?

We use our extensive risk and insurance knowledge to help you navigate the full suite of insurance products. As such, we’ll guide you through the pros and cons of each product to help you choose the most appropriate insurance solution for your needs.

When you come on our risk discovery journey, firstly, we’ll help you to streamline existing insurance programs, align renewal dates and provide recommendations to address critical gaps in cover.

Secondly, with our fee-for-service approach, you can feel confident that our fee is calculated based on the insurance services you receive rather than the policies themselves. It also helps reduce the taxes payable on your premiums.

If you would like to discuss your insurance program with an experienced adviser, you can contact Clear Insurance on 1300 721 132 or complete our online enquiry form.

The critical question we ask is:

What level of risk are you prepared to take when making operational decisions in your business?

• Low
• Medium
• High

Our risk discovery journey helps you use financial data, strategic growth plans and current operations to determine the level of risk your business can afford.

What is business management risk?

Business management risk looks at the factors that expose your senior management team to legal action. Unfortunately, in today’s litigious environment, no business relationship is free of risk.

Therefore, it’s vital to consider your dealings with other parties, including employees, suppliers, investors, competitors, customers, government agencies, regulators and creditors.

While you may feel that you have strong relationships with internal and external parties, they have the potential to cause harm to your business at any time.

Thus, it’s critical to protect your business against the costs of any legal action taken against you, your directors, or the business.

Types of business management risk to consider.

There are different types of business management risks to consider, such as:

• Defamation
• Crime
• Employment

Today, we’ll focus on defamation and why you should protect your business against legal action.

Defamation

Does your business make comments about clients in emails, in office conversations or whilst out at coffee in public venues?

You never know who may be listening or their connections to staff, suppliers or investors.

So, why does it matter? It matters because it can lead to legal action against your company or directors to repair damage to their reputation.

Unfortunately, it happens, and a court case’s outcome can be costly.

How can Clear Insurance help you?

Firstly, we use over 65 years of combined general insurance knowledge to help you evaluate business management risk.

Secondly, we work with you to build your risk profile so you can decide whether to keep, mitigate or transfer risk to insurance.

We’ll evaluate your existing insurance programs to help streamline policies, align renewal dates and make recommendations to address critical gaps in cover.

Finally, with our fee-for-service approach, you can feel confident that our fee is calculated based on the insurance services you receive. Plus, it reduces the taxes payable on your premiums.

If you would like to discuss your insurance program with an experienced adviser, you can contact Clear Insurance on 1300 721 132 or complete our online enquiry form.

Business Continuity and Vital Employees

The impact of losing vital employees can be more prevalent in advice-based occupations, such as architects, accountants, insurance advisers and legal advisers.

For businesses that rely on an individual’s knowledge and experience, losing a critical team member can leave a huge gap in service provision, particularly if they are injured or are unable to work for extended periods.

Their absence can disrupt your business operations and cash flow, which becomes evident when advertising and hiring a permanent or temporary replacement.

Albeit a considerable disruption, it’s reassuring to know that there are products in the market to help you keep your business on track – for example, Business Continuity Cover.

Business Continuity Cover could be your saviour.

Due to prolonged border closures and a nationwide skills shortage, Australian businesses feel the effects of a tight labour market. In short, it’s tough to attract and retain talented staff.

Business Continuity Cover gives you breathing space to decide how best to fill the gap created by staff injury or illness. Therefore, it’s vital extra protection for your business.

Clear Managing Director Lisa Carter says, ‘As a risk adviser to business leaders, I like to practice what I preach. Once I heard about business continuity cover, I immediately took out a policy to cover two roles in my business. Firstly, my role as Managing Director and secondly for my Clear Leader who runs our day-to-day operations.’

‘Business Continuity Cover is affordable. It provides assurance that should either of us be unable to work, I know I can claim the costs of recruiting and paying a replacement for up to 12 months. As a business owner, it gives me complete peace of mind,’ explains Lisa.

What is Business Continuity Cover?

Business Continuity Cover ensures you cover your business for:

• Sickness and accidents to the insured person
• Recruitment and advertising costs
• Relocation costs for your replacement employee
• Wages for your replacement employee

As with all types of insurance cover, terms and conditions apply, so you must become familiar with your policy to ensure you understand it fully.

Business Continuity Cover enables you to cover one or more vital employees under the policy, provided they are all named. For example, cover is available for up to $200,000 and can cost less than $650 per person. It’s a small price for peace of mind.

Need advice?

Clear Insurance provides risk and insurance advice to business leaders across a broad range of industries, including medical, hospitality and construction.

As such, our team uses their knowledge of your industry to help build a risk profile for your business. We guide you through the different types of business risk and assess the level of risk your business can financially support.

Clear Insurance does not accept insurer commissions. We make an independent assessment of your existing policies and offer advice to better protect your business. Our fee-for-service approach ensures you only pay for the advice we provide.

To start your risk discovery journey, contact Clear Insurance today.

What is the ATO Data Matching Program?

The ATO data matching program allows the ATO to gather information from various sources to build a clearer picture of your declared wealth.

After launching in 2011, the ATO extended the program to include lifestyle assets in 2013. Now, by gathering data on lifestyle assets registered to your business, the ATO can see if your income reflects your lifestyle.

While you may think it’s easy to buy assets through your business or under a different name, it’s not. The ATO uses over 60 identity matching tools to pair assets to individuals, including using data from insurers.

Further, the ATO gathers information for around 300,000 people each financial year. As a result, ATO officers and data analysts can look for variations, such as under or over reporting of tax deductions.

While the primary purpose is to identify non-compliance, the program also allows the ATO to create products and educational tools that help you manage your tax duties.

What lifestyle assets are included in the ATO data matching program?

For the period 2021-2022 to 2022 to 2023 the ATO data matching program will obtain lifestyle asset data from insurance policies on the following assets:

Lifestyle assets such as luxury cars are included in the ATO data matching program.

The types of data securely collected from insurers includes:

• Client identification details (names, addresses, phone numbers, dates of birth, Australian business number, email address)
• Policy details (policy number, policy inception date, start date of current policy, end date of current policy, total value insured, purchase price of the property insured, registration or identification number of the property, insurance category, policy cost, description of the property insured, primary use type).

What should I do if details for my assets are not up to date?

The purpose of the scheme is to encourage taxpayers to comply with business and personal tax obligations. Most importantly, the program aims to uphold the integrity of the tax system, so that we all feel it’s credible and fair.

The ATO collects data to pre-fill tax returns each year. Therefore, the ATO want you to correct data on your old and new tax returns. For example, you should make sure fringe benefits, business expense deductions or other business-related claims are accurate.

In similar fashion, it’s vital to draw a clear line between your business and personal assets for insurance purposes.

The ATO will always notify the public of the specific areas that are subject to scrutiny. Therefore, if you have made a reporting error, contact the ATO or your accountant to make corrections.

How can Clear Insurance help you?

We understand that running a business is time-consuming. Particularly, admin jobs. For example, when you’re busy letting insurers know about business asset and income changes often becomes low priority.

In fact, that’s where risk and insurance advisers, such as our Clear Advisers, are worth their weight in gold. When you appoint Clear Insurance we save you time by keeping insurers up to date on asset and income changes.

Most importantly, with our fee-for-service approach, you can feel confident we always act in your best business interests.

If you would like to discuss your insurance program with an experienced adviser, you can contact Clear Insurance on 1300 721 132 or complete our online enquiry form.

If you would like to discuss your insurance program with an experienced adviser, you can contact Clear Insurance on 1300 721 132 or complete our online enquiry form.

That’s where Public Liability Insurance comes into the picture. It protects you and your business against the substantial legal costs of engaging lawyers to help you defend and pay any damages you may or may not be liable for.

What does Public Liability Insurance cover?

As a business owner, you already know that you have a responsibility for people that visit your premises, or when you go out to clients’ homes or businesses. Accidents, however, can happen, which is why you need to protect your business with Public Liability Insurance.

This type of insurance provides the following types of cover, which should also be tailored to your business’ specific needs.

• Payment of damage to the property of a third party or loss of proven business income. A third party is any customer, visitor or anyone you deal with for business, except employees;
• Legal costs associated with having a lawyer assist you and defending the claim, if necessary;
• Costs to employ specialists and consultants to help in your defence of the allegations;
• Damages agreed as payable by your insurer to the third party, if they have found you responsible;
• Damages ordered by the court; also
• Payment of the third party’s legal costs and expenses, if your found responsible for the injury, death or property damage.

Some factors you need to think about when deciding on the amount of Public Liability coverage that’s required by your business will include: the type of business; how many people you have on your premises; any requirement from a council, client of landlord. For example, a diving company might require higher coverage and pay more premiums than a dog walking business.

What does it not cover?

It’s important to understand that Public Liability Insurance isn’t the only insurance required by your business. For example, it doesn’t cover your business for injuries to your employees, which is covered by Worker’s Compensation Insurance. Insurers are also usually not allowed to pay any penalties or punitive damages on your behalf.

In addition, if your products are recalled for whatever reason, Public Liability Insurance doesn’t cover you for the financial or reputational losses due to this event. This would be insured by a Product Recall Insurance. Lastly, issues involving asbestos, aircraft or motor vehicles are not covered under this policy, as there are specific insurance policies for these items.

Do you really need Public Liability Insurance?

Whilst slips, trips and falls are only one type of allegation that can be claimed against your business, it’s good to know the numbers have been on the decrease since 2016. However, that’s no reason to become complacent because the financial and reputational costs to fight these allegations in a court of law can be significant, and the average cost of each claim has been increasing.

This means that you can take all the care in the world and rarely even be faced with these types of allegations, but it can only take one claim to ruin your company financially and reputationally. So, if your company interacts with suppliers, customers or the public in any way, then you can benefit from some level of Public Liability Insurance.

If you’d like to discuss your insurance program or request a risk and insurance review, contact the Clear Insurance team on 1300 721 132, email info@clearinsurance.com.au or complete our online enquiry form and an adviser will be in touch.