ACT Independent Senator David Pocock has taken up the cause of small and micro business owners who find that working from home voids their home and contents insurance.
An investigation by the ABC earlier this month revealed that policyholders with ABNs registered at their homes may not have cover.
Since then, several people have come forward about immediate cancellations of their policies.
Senator Pocock said the emerging problem had the potential to affect thousands of small and micro businesses across the country and he wanted to help find a solution.
“Ninety-seven per cent of Australian businesses are small businesses, so this is affecting a huge number of people, it’s something we really need to look at,” he said.
“It doesn’t make sense to me that even if you have home and contents and small business insurance, you wouldn’t be covered for that.”
Insurance is federally regulated and Senator Pocock is calling on the Albanian government to address the issue urgently.
He said he had already scheduled meetings with the Australian Small Business and Family Business Ombudsman and was writing to Deputy Treasurer Stephen Jones, the Australian Financial Claims Authority, the Insurance Ombudsman and the Insurance Council of Australia .
“Insurance is so crucial that you don’t need it until you need it. We really need to be looking at what the solutions are here,” he said.
The insurance policy is “cancelled on the spot”
Steve Cook had been insured with Allianz for over 30 years and had never made a claim before they canceled his policy. (ABC News: Ian Cutmore)
Senator Pocock decided to take up the cause after receiving a letter from Canberra independent filmmaker Steve Cooke, who had his Allianz home and contents insurance policy canceled after he revealed he was running his small business from his home in the southern suburb of Farrer.
“I first learned about a possible insurance issue through ABC News and thought I should call my insurance company and make sure everything is covered,” he said.
“They canceled it on the spot, they didn’t give me any explanation.
“I asked what the risk might be to them, they didn’t give me any details.
“They just canceled it and said, ‘you’re going to get a letter in the mail, you’ve violated our insurance guidelines by having a small business at home.’
The retired police officer turned to film five years ago after PTSD prompted him to take a different path in life.
It has a small volunteer film crew starting out in the industry and uses local actors who also volunteer their time to make films about Canberra and the surrounding region.
Cooke said it “took quite a bit of work” to find another insurance company but eventually found cover with the NRMA.
“But there are tight parameters around what I can actually do at home,” she said.
“I’m restricted to half a room in the house. I can’t do any business-related activities here in terms of filming.
“So any kind of filming that I did in the past at my house, I can’t do that.”
“Everything is absurd”
According to the new insurance policy of Mr. Cooke, he just cuts films in his house and stores his equipment there. (ABC News: Emma Groves)
Mr Cooke said Allianz’s response had left him “angry”, especially considering he had been insured with them for more than 30 years, had never made a claim and had separate commercial insurance.
“I can’t see what the risk would be,” he said.
“The lighting is battery operated, so it doesn’t drain the main power. All the cameras are battery operated, we don’t do any scenes that involve stunts or anything that’s risky.
“This is all nonsense to me.”
Mr Cooke said he did not know what the future held for his business as he could no longer do small shoots at his home with his new insurance policy and would have to find the funds to hire film sets .
But he said he was relieved to have his home properly insured and urged anyone with a side hustle, hobby business or small business in their home to check their insurance coverage.
“Be prepared for them to say your insurance is cancelled, because that’s what happened to me and I wasn’t prepared for that,” he said.
In a statement, a spokesman for the Insurance Council of Australia said insurers asked customers a series of questions when they bought or renewed insurance, “seeking information relevant to the policy, including whether it will last for conduct any business or commercial activity on the property.” said
“It is important that questions are answered accurately and truthfully, no matter how big or small or the type of business activity, inaccuracies or omissions can put future coverage and claims at risk.”
The ABC has contacted Deputy Treasurer Stephen Jones’ office and expects a response later today.