The escalating digitalisation of our lives and enterprises has led to a parallel growth in the complexity and frequency of cyber-attacks. Small and medium-sized enterprises (SMEs), particularly in Australia, are experiencing increased vulnerability to cyber threats, posing a significant challenge to the nation's cyber security landscape. Embracing transformative technologies such as Artificial Intelligence (AI), Machine Learning (ML) and Large Language Models (LLMs) can potentially strengthen cyber security policies for Australian SMEs. However, their practical application, advantages, and limitations remain underexplored, with prior research mainly focusing on large corporations. This study aims to address this gap by providing a comprehensive understanding of the potential role of LLMs in enhancing cyber security policies for Australian SMEs. Employing a mixed-methods study design, this research includes a literature review, qualitative analysis of SME case studies, and a quantitative assessment of LLM performance metrics in cyber security applications. The findings highlight the promising potential of LLMs across various performance criteria, including relevance, accuracy, and applicability, though gaps remain in areas such as completeness and clarity. The study underlines the importance of integrating human expertise with LLM technology and refining model development to address these limitations. By proposing a robust conceptual framework guiding the effective adoption of LLMs, this research aims to contribute to a safer and more resilient cyber environment for Australian SMEs, enabling sustainable growth and competitiveness in the digital era.