The 2026 Vero SME Insurance Index: What It Means for Your Business
What Australia’s largest annual SME insurance survey reveals about the gap between what businesses believe and what’s actually true
Every year, Vero Insurance surveys thousands of Australian small and medium businesses to understand how they think about risk, insurance, and resilience. Now in its 15th year, the 2026 Vero SME Insurance Index surveyed 1,750 Australian businesses between September and December 2025, and the findings paint a clear picture: most business owners believe they’re more prepared than they actually are.
For a report built on data rather than opinion, that gap between perception and reality is the single most important takeaway for any SME owner. Here’s what the 2026 Index actually found, and what it means for your business.
The Business Continuity Blind Spot
Perhaps the most striking finding in the 2026 Index is this: four in ten Australian businesses don’t have a Business Continuity Plan, and around a third aren’t even familiar with what one is or why it matters.
A Business Continuity Plan, at its simplest, is a documented approach to keeping your business running, or getting it running again quickly, after a disruption. That could be a fire, a flood, a cyber incident, the sudden loss of a key supplier, or something as simple as losing access to your premises for a few weeks. Without a plan, businesses tend to make critical decisions under pressure, in the middle of the disruption itself, which is exactly when good decision-making is hardest.
What’s genuinely interesting is what the Index found isn’t stopping businesses from creating one. It isn’t cost. The real barriers are uncertainty about whether a formal plan is even relevant for a business their size, time pressure, simply not knowing where to start, and competing daily priorities crowding it out. In other words, most businesses aren’t choosing to skip continuity planning, they’re simply never getting around to it.
The Index also identified what actually moves businesses from awareness to action: a recommendation from a trusted professional, help comparing options, a requirement tied to a supplier or contract, or access to simple, practical tools rather than a complex corporate framework. This is a meaningful insight for any business owner who has been meaning to “sort out a plan eventually”, the businesses that actually get one in place are usually the ones who had someone walk them through it, rather than the ones who tried to build a comprehensive plan from scratch on their own.
The Underinsurance Gap: What You Believe vs. What’s True
The second major theme in the 2026 Index is underinsurance, and this is where the gap between perception and reality becomes stark.
According to the Index, almost one in ten SMEs describe themselves as underinsured. That sounds like a manageable, minority problem. But only 42% of businesses review their sum insured every year, meaning the vast majority are carrying insurance values that may not have been checked against current replacement costs, current stock levels, or current equipment values in a long time.
This self-reported figure sits in sharp contrast to broader industry findings. Other insurers and brokers, drawing on claims data and independent assessments, have found underinsurance rates commonly estimated at 70-80% of Australian businesses when property and assets are actually assessed. The pattern is consistent across the industry: business owners genuinely believe their cover is adequate, largely because it was adequate when the policy was first set up, but rising building costs, equipment prices, and replacement values have quietly outpaced the sum insured over the years since.
This is precisely why Knightsbridge has been telling clients for some time that roughly half of Australian businesses are underinsured, a figure that sits between the Index’s self-reported number and the higher rates found through actual asset assessments. The uncomfortable truth is that underinsurance often isn’t discovered through a check-up. It’s discovered at claim time, when it’s too late to do anything about it except absorb the shortfall.
Why This Matters More in 2026
Both findings point to the same underlying issue: many Australian businesses are operating on assumptions rather than current information. A continuity plan that was never created, or a sum insured that hasn’t been reviewed since the policy started, both represent the same kind of risk, decisions made once, years ago, that nobody has revisited since.
The 2026 Index also touched on a broader “two-speed economy” affecting Australian businesses unevenly, rising costs pressure on claims and premiums, and a growing chapter on how businesses are approaching AI adoption alongside traditional risk management. But continuity planning and underinsurance stand out because they’re both highly actionable, and both are problems a single, well-informed conversation can meaningfully address.
The Role of a Trusted Adviser
If there’s one consistent thread running through the 2026 Index, it’s this: businesses are significantly more likely to take real action on both continuity planning and adequate insurance when they have a trusted professional guiding the conversation, rather than working through it alone.
That’s not a coincidence, and it’s not just an insurance industry talking point. A broker who understands your industry, your assets, and your operations is in a position to ask the questions that reveal gaps you didn’t know existed: has your sum insured kept pace with rebuilding costs? What would actually happen to your business if you lost access to your premises for six weeks? Do your suppliers or contracts require you to have continuity arrangements in place that you haven’t documented?
These aren’t complex questions, but they’re easy to overlook when you’re focused on running the business day to day. That’s exactly the gap a good broker relationship is designed to close.
Turning the 2026 Index Into Action for Your Business
The findings of the 2026 Vero SME Insurance Index aren’t really about Vero, or about the insurance industry in the abstract. They’re about a simple, recurring pattern: Australian businesses tend to believe their risk position is more current and more complete than it actually is, not through negligence, but simply because life gets busy and these things are easy to set once and forget.
At Knightsbridge Insurance Group, this is exactly the conversation we have with clients every day, reviewing sums insured against real replacement costs, working through what a continuity plan actually needs to look like for a business of your size, and making sure your cover reflects your business as it is today, not as it was when the policy was first written.
If it’s been a while since your insurance was properly reviewed, or if you’ve never put a continuity plan in place, now is a good time to have that conversation.
Get in touch with the Knightsbridge team today to talk through where your business really stands.
Important Disclaimer: This article provides general information only and does not constitute legal or financial advice. References to the 2026 Vero SME Insurance Index reflect publicly available findings from Vero Insurance and are provided for general informational purposes. Insurance and risk management needs vary significantly based on individual business circumstances. Readers should consult with qualified insurance professionals before making risk management decisions. Knightsbridge Insurance Group holds Australian Financial Services Licence 514855.