Best small business insurance in New Zealand

Whether you’re running a Murchison mechanical workshop or a Christchurch cafe, small business insurance provides plenty of practical protections. But combing through the fine print to find the right cover is the last thing a busy entrepreneur wants to do.

In this post, we’re explaining small business insurance in plain English, including a definition, policy types, typical prices, and key considerations. We’ll also recommend a few leading providers.

Table of contents
What is small business insurance? Importance Compulsory business insurances in NZ Types Cost Providers Key considerations Wise Business: Streamline your global procurement payments FAQs

What is small business insurance?

Small business insurance is a type of business insurance catering to SMBs. The business pays a monthly or annual premium, and the provider promises to cover for costs arising from agreed-upon events.

Examples include business interruptions, building fires, motor vehicle accidents, litigation, and more.

Not all small business insurance in New Zealand is the same. Coverage may vary between providers for similarly named policies. Comparing two policies requires checking the terms detailed in the Product Disclosure Statements (PDS), AKA the fine print.

Small business insurance generally comes with an excess, a dollar figure you pay towards any claims. Many providers let you choose the excess; lower excesses mean higher premiums.

Why insurance for small businesses in NZ is important

From crop failures to restaurant fires and workplace falls, unexpected events can spell financial catastrophe for a small business. Many entrepreneurs lack the resources to recover, meaning one bad day could send a company under. Insurance protects against these events to help small businesses survive when disaster strikes.

Here’s a hypothetical example of how business insurance could help a Kiwi restaurant:

George employs five staff at his Wellington restaurant. One evening, a pipe bursts and floods the kitchen, damaging cooking equipment and rendering the venue unusable. George closes the restaurant for two weeks while contractors undertake cleaning and repairs.

Luckily, George has business assets insurance to cover repairs and business interruption insurance to cover wages and lost revenue. If he were uninsured, George would be out tens of thousands of dollars, enough to send him broke.

Compulsory business insurance in New Zealand

Business insurance isn’t just a good idea. In some cases, it’s a non-negotiable.

Employers and the self-employed pay compulsory ACC Work, Working Safer, or Earner levies. These are separate to income tax and cover the costs of an accident-related injury: medical bills, treatment, and loss of income. Coverage applies as soon as you start trading.¹

While New Zealand law has relatively lenient insurance requirements, many industries have contractual obligations. For example, when constructing a new home, a typical contract requires the builder to organise contract works insurance, which covers damages to a property undergoing construction.²

Likewise, liability insurance is often required for contractors entering into a new work arrangement.³

Industry-specific contractual requirements often apply to businesses in sectors such as healthcare, financial services, transport, IT, construction, education, law, and accounting.

Types of small business insurance policies

There are many different policies for small businesses to consider, each covering different risks. As businesses face various risks, many entrepreneurs take out multiple policies.

Here’s a list of the most common small business insurance policies in New Zealand, and what they cover:

• Business liability: Legal liabilities and costs, split into three types
  • Public liability for damaged property or injuries related to business activities
  • Statutory liability for an unintentional breach of an Act
  • Employer liability for employees injured at the workplace
• Business assets: Damage or loss of equipment, tools, stock, contents, and buildings
  • Indemnity considers wear and tear when paying out a claim
  • Replacement covers the full cost of replacing each item
• Commercial property: Natural disasters, burglary, fire, and other events that may damage or destroy a property
• Business vehicles: Accidental damage or loss of commercial vehicles
• Business interruption: Revenue loss and other costs related to insured damages
• Rural insurance: Loss or damage to equipment, crops, and livestock
• Machinery: Losses caused by accidental breakdowns of machinery
• Cyber: All types of cybercrime, including scams, fraud, hacking, and data breaches
• Contract work: Accidental damage while renovating or constructing a building

How much does small business insurance cost?

Most small Kiwi businesses pay somewhere between $50 and $200 per month.

Several factors influence risk and premiums:

• Location: High-crime or natural-disaster-prone regions increase risk
• Size: Larger businesses with more assets have a higher risk
• Coverage: Protection against multiple risks requires multiple policies
• Coverage limits: Public liability insurance for small business covering up to $1,000,000 will cost more than the same insurance with a $100,000 limit
• Business nature: Underwater welding is inherently riskier than accounting
• Claims history: Like car insurance, premiums tend to rise after making a claim

Typical prices also vary significantly between insurance types. According to an analysis from BizCover, the average price of professional indemnity insurance for small New Zealand businesses is $85 per month.⁴ MoneyHub lists several public liability insurance options from $10 per month.⁵

Some of the small business insurance providers in NZ

A number of insurance providers offer products specifically tailored for small Kiwi businesses. Here’s a shortlist of some of the leading players.

Ami

A major player that won ANZIIF’s General Insurance Company of the Year 2024, Ami has almost 100 years of insurance industry experience.

• Business vehicles
• Business liability
• Business assets
• Business interruption
• Rural insurance
• Machinery breakdown
• Cyber insurance
• Contract work⁶

Stateside Insurance

A Reader’s Digest ‘Trusted Brand’ for 11 years running, and preferred insurer for 30,000+ small New Zealand businesses.⁷

• Business liability
• Business vehicle
• Business assets
• Business interruption
• Contract works
• Farm insurance
• Machinery breakdown
• Transit insurance
• Stock deterioration⁸

Tower Insurance

A Kiwi-owned and operated company providing insurance to local businesses for over 150 years.⁹

• Business assets
• Commercial vehicle
• Business interruption
• Business liability¹⁰

AA

A large provider specialising in the trades, hospitality, and ride share industries.

• Public and products liability
• Statutory liability
• Employers liability
• Business contents and stock
• Portable contents and stock
• Commercial vehicle ¹¹

Gallegar Insurance NZ

A well-regarded insurance broker helping hundreds of thousands of SMEs find the right products and policies through impartial advice.

• Liability
• Professional indemnity
• Business continuity
• Cyber insurance
• Key persons’ life and health
• Commercial motor vehicle¹²

Key considerations when choosing small business insurance

Keep the following in mind when shopping around.

• Risk magnitude: Most businesses prioritise the biggest risks, such as property fires and law suits, as they simply can’t afford to cover these costs alone.
• Excess: When choosing an excess, weigh up the level of risk, how likely you are to make a claim, and what the potential losses will be.
• Provider advice: Many insurance providers offer free over-the-phone consultations; however, you may get pressured into over-insuring.
• Under-insuring: Insufficient cover can be perilous; is the maximum limit enough to cover your worst case scenario?
• Brokers: Third-party brokers can offer impartial advice and help you dcypher the fine print; the savings may be worth the fees.
• Reducing risk: Some insurers lower premiums when you take steps to reduce risks, such as installing locks, alarms, and CCTV, or educating staff on health and safety.
• Contracts: Read the fine print on your contracts, because many have minimum coverage limits for public liability and professional indemnity insurance.
• Upfront payments: Many providers offer decent discounts for a 12-month upfront payment, should your cash flow allow it.
• Reviews: An annual insurance review can optimise cover as your business grows, especially after major changes like adding a new premises.
• Business changes: Your insurance company needs to know when things change as this may affect your cover.
• Accuracy: Providing inaccurate information when signing up for a policy could see any later claims get rejected.
• Balance: Being over-insured means costly premium, while being under-insured means unacceptable risk; the trick is finding a nice balance.

Wise Business: Streamline your global procurement payments

As procurement strategies increasingly involve sourcing from overseas to manage costs, the final step of paying international suppliers can unexpectedly chip away at your savings. Navigating international payments often means dealing with marked-up exchange rates and hidden/unclear fees.

A Wise Business account helps you manage this part of the procurement cycle by offering payments at the mid-market exchange rate with a small, transparent fee. This way, you can pay your global suppliers, contractors, and freelancers confidently, ensuring the cost-benefits you negotiated are reflected on your bottom line.

Wise Business helps streamline overseas business payments without foreign transaction fees, saving up to 6x compared to other providers.

• Free to register — Send money to 140+ currencies with no hidden exchange rate markups
• Make up to 1,000 transfers at once with the Wise batch payments feature
• Fast, low-cost payouts to customers, freelancers, employees, investors, and suppliers globally
• Automate invoice payments, recurring transfers, and international payroll
• Fast and fully secure payments through Wise, even for large amounts

Tired of hidden fees and complex processes when making overseas payments?

Start sending with a Wise Business account! 🚀

This general advice does not take into account your objectives, financial circumstances or needs and you should consider if it is appropriate for you.

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FAQs

1. Is a small business required to provide health insurance for employees in New Zealand?
No. New Zealand has universal health insurance, thus employers aren’t required to provide health insurance for staff. However, employers are obligated to pay ACC levies that cover work-related and non-work-related injuries.¹

2. How much is liability insurance for a small business?
Public liability insurance starts from just $10 per month.⁵

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Sources:

1. ACC: Understanding levies
2. Building: Why contracts are valuable
3. Building: Planning for the unexpected
4. BizCover: Professional indemnity cost
5. Ami: Small business insurance
6. State: Business insurance
7. State: Cover options
8. Tower: About Us
9. Tower: Business insurance
10. AA: Small business insurance
11. Gallegar: Small business insurance