As a one-person company, you may still need insurance: business.gov.au lists public liability for certain occupations in some states and territories, workers compensation if you have employees, and third-party personal injury insurance for vehicles among the covers most commonly required by law. Professional indemnity insurance is mandatory for some professions, while management liability is an optional cover for claims arising from the management practices of directors, officers and managers. The source is business.gov.au, published by the Australian Government’s Department of Industry, Science and Resources, and was checked on 2026-10-01; public liability cover amounts and costs are not stated on the official page.
What does business.gov.au say is required by law?
Some insurance may be required by law, while other types are a business choice. People you deal with may also require insurance, and some businesses must hold liability insurance before they can legally operate.
| Cover | Required-by-law position stated by business.gov.au |
|---|---|
| Public liability | May be required for certain occupations in some states and territories. It covers death, injury or property damage caused by negligence. |
| Workers compensation | Required if the business has employees. Employers must obtain it from an authorised insurer. |
| Third-party personal injury | The guidance includes insurance for vehicles among the most common legally required covers. The detailed vehicle trigger is not stated on the official page. |
Public liability cover amounts and costs, including which occupations require the policy, are not stated on the official page.
Workers compensation laws vary between states and territories. Thresholds, premiums, who counts as a worker and whether a working director is covered are not stated on the official page. business.gov.au directs employers to the relevant state or territory regulator.
Which covers are optional?
| Cover | Position | What it covers |
|---|---|---|
| Professional indemnity | Optional unless the profession requires it. It is mandatory for some professions. | Claims involving professional advice or services, including client loss caused by mistakes, neglect or breach of contract. |
| Management liability | Optional. | Claims against directors, officers or managers arising from their management practices. |
The professions for which professional indemnity insurance is mandatory are not stated on the official page. business.gov.au also describes its overview as general information that does not replace professional advice.
What changes when you are the sole director?
For workers compensation, the relevant question is whether the company has employees. If it does, the employer must obtain workers compensation insurance from an authorised insurer.
Being the only person in the company does not resolve every state and territory question. Whether a working director counts as a worker, along with relevant thresholds and premiums, is not stated on the official page. Check the state or territory regulator before relying on the company’s headcount alone.
A sole trader has a different position under the guidance. business.gov.au says workers compensation insurance does not cover sole traders themselves and advises them to obtain personal death, illness and disability insurance. How that statement applies to a working company director is not stated on the official page.
How do I check a policy and a broker?
- Request the Product Disclosure Statement. An insurance company must provide a Product Disclosure Statement (PDS). It explains the policy’s terms and conditions in clear words and should be read before buying.
- Check a broker’s licence. Brokers must hold a current Australian Financial Services (AFS) licence. business.gov.au says this can be checked on ASIC’s register.
- Keep the legal and optional decisions separate. A contract or professional rule may make a policy necessary even when it is not generally required for every company.
These points come from business.gov.au’s “Manage your business insurance” guidance, checked on 2026-10-01.
When is advice general rather than personal?
ASIC Moneysmart’s financial-advice page, last updated 18 June 2026 and checked on 2026-10-01, distinguishes:
- General advice: a recommendation or opinion about a financial product that is not tailored to the recipient’s personal circumstances.
- Personal advice: tailored advice for which the provider must act in the client’s best interest.
These are general financial-advice definitions. Business-insurance-specific guidance is not stated on the official Moneysmart page.
Frequently asked questions
Does a one-person company still need insurance?
It may. The applicable requirements depend on factors such as the company’s occupation, location, whether it has employees, whether it uses vehicles and whether its profession requires professional indemnity insurance. Management liability remains an optional cover under the guidance.
If I am the only person in the company, do I need workers compensation?
The stated requirement applies if the company has employees, in which case the employer must use an authorised insurer. Whether a working director is covered is not stated on the official page because the law and the definition of a worker vary by state or territory. Check the relevant regulator.
Is professional indemnity insurance always optional?
No. It is mandatory for some professions and optional otherwise. The professions subject to the mandatory requirement are not stated on the official business.gov.au page.
What should I check before buying through a broker?
Ask for the PDS and read it before buying. If a broker is involved, check that they hold a current AFS licence on ASIC’s register.
Where can I verify the official guidance?
The relevant official sources are:
Sources
- Types of business insurance | business.gov.au — Australian Government, Department of Industry, Science and Resources; checked on 2026-10-01; no last-updated date is stated on the official page.
- Manage your business insurance | business.gov.au — Australian Government, Department of Industry, Science and Resources; checked on 2026-10-01; no last-updated date is stated on the official page.
- General and personal financial advice - Moneysmart.gov.au — ASIC Moneysmart; last updated 18 June 2026 and checked on 2026-10-01.