Drawing on our experience assisting clients with commercial insurance arrangements and claims, BSI Brokers aims to help business owners better understand the insurance options available in New Zealand.
What types of commercial insurance are commonly available? What do they cover, and which businesses should consider them?
In this guide, we introduce 10 common types of commercial insurance and explain how they may help protect your business.
🛡️ 01. Public Liability Insurance
Public Liability Insurance helps protect businesses against certain legal liabilities arising from accidental injury to third parties or damage to their property in connection with business activities.
Businesses can face liability risks through their premises, products, services or day-to-day operations.
Examples may include:
- A customer slipping and injuring themselves inside a restaurant, shop or office.
- A contractor accidentally damaging a client's building or property while carrying out work.
- A business activity causing accidental damage to a third party's property.
Public Liability Insurance can help cover eligible legal defence costs and compensation, subject to the policy terms, conditions and exclusions.
It is an important consideration for many businesses, particularly those that interact with customers, visit client premises, undertake physical work or operate from commercial locations.
⚖️ 02. Statutory Liability Insurance
Statutory Liability Insurance is designed to help businesses respond to certain allegations or prosecutions involving breaches of New Zealand legislation.
Businesses must comply with various legal and regulatory obligations. Even where a breach is not intentional, an administrative error, oversight or failure to meet a legal requirement may result in an investigation or prosecution.
Depending on the policy, Statutory Liability Insurance may cover:
- Legal defence costs.
- Certain investigation and representation costs.
- Certain fines or penalties, but only where legally insurable.
- Other covered costs arising from an insured statutory liability matter.
For example, a business may face an investigation following an alleged breach of workplace health and safety, environmental or other regulatory requirements.
Important: Not all fines, penalties or legal consequences are insurable in New Zealand. Intentional, dishonest or criminal conduct and penalties that cannot legally be insured are generally excluded. Cover depends on the relevant legislation and policy wording.
👷 03. Employers Liability Insurance
Employers Liability Insurance provides protection against certain legal liabilities arising from work-related injury or illness suffered by employees, particularly where the claim falls outside the scope of ACC cover.
In New Zealand, ACC provides a statutory no-fault compensation scheme for covered personal injuries. However, businesses may still face certain legal claims and associated costs that are not covered by ACC.
Examples may include:
- An employee developing an occupational illness following prolonged exposure to certain workplace substances.
- An employee suffering a work-related condition arising from ongoing workplace factors.
- A business facing a claim relating to an alleged failure to meet its obligations as an employer.
Depending on the policy, Employers Liability Insurance may help cover eligible legal defence costs and compensation.
Businesses with employees, particularly those operating in construction, manufacturing, trades and other higher-risk environments, should consider whether this cover is appropriate.
📦 04. Material Damage Insurance
Material Damage Insurance helps protect the physical assets a business owns or is responsible for against specified insured events.
These assets may include:
- Office equipment, computers and electronic devices.
- Shop fittings, furniture and business fixtures.
- Machinery, tools and production equipment.
- Warehouse stock, goods and commercial inventory.
- Other business property specified in the policy.
For example, a fire could destroy business stock, a burglary could result in stolen equipment, or a storm could damage a warehouse and its contents.
Material Damage Insurance can help businesses recover the cost of eligible property losses, subject to the insured values, policy limits, excesses and conditions.
It is important to ensure that the insured property and sums insured accurately reflect the business's assets and replacement costs.
🏪 05. Business Interruption Insurance
Business Interruption Insurance helps protect a business against certain financial losses when an insured event disrupts its normal operations.
Even if a business temporarily stops trading, expenses such as rent, salaries and other ongoing operating costs may continue.
Depending on the policy, Business Interruption Insurance may cover:
- Loss of gross profit or revenue, as defined by the policy.
- Certain continuing operating expenses.
- Additional costs incurred to minimise the interruption and resume operations.
For example, if a restaurant suffers significant fire damage and must close temporarily for repairs, the business may lose income while continuing to incur rent and other operating expenses.
Business Interruption Insurance may help reduce the financial impact during the recovery period.
Important: Business Interruption cover commonly requires an insured physical loss or damage event under the relevant property policy. It does not automatically cover every cause of business interruption. Indemnity periods, waiting periods, extensions and other conditions vary between policies.
🏢 06. Commercial Property and Landlord Liability Insurance
Businesses that own commercial buildings or investment properties should consider both the physical property risks and potential legal liabilities associated with owning or managing the premises.
Commercial Building Insurance is designed to protect the insured building against specified events, such as fire, storm damage and other insured property losses.
Landlord Liability Insurance may help protect property owners against certain legal liabilities arising from accidental injury to third parties or damage to their property in connection with the ownership or management of the premises.
Examples of potential liability incidents include:
- An external sign or building fixture falling and damaging a parked vehicle.
- Water escaping from a poorly maintained building and damaging a tenant's property.
- A visitor accidentally sustaining an injury in a common area.
- Other incidents involving the condition or management of the insured premises.
Depending on the insurer and policy structure, property damage and liability cover may be arranged separately or as part of a broader commercial insurance package.
Property owners should review their building cover, liability exposure, maintenance responsibilities and any relevant lease obligations.
🚐 07. Commercial Motor Insurance
Commercial Motor Insurance is designed for vehicles used in connection with business activities.
If your vehicle is used for purposes beyond ordinary private driving, such as visiting clients, transporting goods, carrying tools or travelling between work sites, it is important to ensure that the declared vehicle use matches its actual use.
Common commercial vehicle insurance options may include:
- Comprehensive commercial motor cover.
- Third-party property damage cover.
- Third-party, fire and theft cover.
The appropriate cover will depend on the vehicle, its use, the drivers and the business's requirements.
Private motor insurance and commercial motor insurance can have different terms and conditions. If a vehicle is used for business purposes but insured on an incorrect usage basis, this may affect the insurer's assessment of a claim.
Always disclose the vehicle's actual use and confirm that the policy is suitable for your business activities.
🏗️ 08. Contract Works Insurance
Contract Works Insurance helps protect construction and renovation projects against certain accidental physical losses or damage during the course of the works.
Construction projects can involve significant financial commitments, and unexpected events during the building process may lead to delays, repair costs and additional expenses.
Examples of insured events may include:
- Fire damage during construction.
- Storm or other insured natural hazard damage to the project.
- Theft of eligible building materials or completed work.
- Accidental damage to the structure during the construction period.
Contract Works Insurance may be arranged for an individual project or, where available and appropriate, under an annual policy covering multiple projects.
The cover may also need to address existing structures, construction materials, temporary works, contractors and subcontractors, depending on the nature of the project.
Builders, contractors, developers and renovation businesses should consider Contract Works Insurance as part of their overall risk management arrangements.
💼 09. Professional Indemnity Insurance
Professional Indemnity Insurance helps protect businesses that provide professional services, advice, designs or specialist expertise against certain claims alleging professional negligence, errors or omissions.
Even when professionals take reasonable care, an error, oversight or failure in their professional services may result in a client suffering financial loss and making a claim.
Industries that may need to consider Professional Indemnity Insurance include:
- Lawyers and legal service providers.
- Accountants and financial professionals.
- Insurance and mortgage advisers.
- Business consultants and management advisers.
- Architects, designers and engineering consultants.
- IT consultants and specialist technical service providers.
For example, a consultant may provide advice that contains an error, resulting in financial loss to a client. Similarly, a design omission may lead to additional costs for a project.
Depending on the policy, Professional Indemnity Insurance may help cover eligible legal defence costs and compensation arising from covered claims.
Professional Indemnity policies are commonly written on a claims-made basis. This means the timing of when a claim is first made and notified to the insurer can be important. Businesses should pay particular attention to retroactive dates, notification requirements and continuity of cover.
💻 10. Cyber Insurance
Cyber Insurance helps businesses manage certain financial and operational risks arising from cyber incidents, data breaches and network security events.
As businesses increasingly rely on digital systems, online transactions and electronic records, cyber risks have become an important consideration across many industries.
Common cyber threats include:
- Hacking and ransomware attacks.
- Unauthorised access to customer information or confidential business data.
- Malware and computer system infections.
- Certain cyber-related fraud and payment incidents.
- Network disruptions affecting business operations.
Depending on the policy, Cyber Insurance may provide cover for eligible incident response costs, data recovery, business interruption, cyber liability claims and certain regulatory investigation expenses.
Businesses that store customer information, process online payments, rely heavily on IT systems or operate online should consider their exposure to cyber risks.
Cyber policies can vary significantly. Certain types of fraud, social engineering, unapproved payments and system failures may be excluded or subject to specific conditions.
🛡️ Protecting Your Business Starts with Understanding Your Risks
Running a business involves much more than managing daily operations. From employees and customers to buildings, equipment, professional services and digital systems, every business faces its own combination of risks.
A single accident, fire, liability claim or cyber incident could have a significant financial impact. Commercial insurance is an important part of managing these risks and helping businesses recover from unexpected events.
At BSI Brokers, we understand that no two businesses are exactly alike. Our insurance advisers can help business owners identify relevant risks, understand available insurance options and compare policy features based on their industry, operations and individual requirements.
Whether you are a small business owner, contractor, property investor or professional service provider, having an appropriate insurance programme can help support your business's long-term resilience.
Looking to review your business insurance?
Contact the BSI Brokers team to discuss your business insurance requirements and explore available options.
Important Information & Disclaimer
This article is provided for general information and educational purposes only. It does not constitute personalised financial advice or a recommendation to purchase any particular insurance product.
The availability and scope of cover, policy definitions, exclusions, limits, excesses and conditions vary between insurers and products. Some covers may not be suitable or available for every business.
All claims are subject to the insurer's assessment and the applicable policy wording. Businesses should review their insurance arrangements regularly and seek advice based on their specific circumstances.