A simple prompt from a broker or advisor will see 59% of SMEs review their insurance programs, according to the Vero SME Index.
The report found that while the majority of businesses favour a standard annual review, 37% look to their insurance following an event like a claim or change in premiums and 26% look to update their cover following a change in their business.
Just 16% of the SME owners surveyed said that they “set and forget” their insurance, and Anthony Pagano, head of commercial intermediaries, Vero, told Insurance Business that this insight into client behaviour gives brokers a chance to plan accordingly.
“There are a range of factors that would make a client think about their insurance and what brokers should be thinking about is at what point do I step in to make sure I am part of that process,” Pagano said. “Whether that is an annual review, or when a catastrophic claim or major event has occurred or whether there has been a planning session about buying new equipment or getting a new contract.
“Through each of those processes, brokers should look to form some part of that conversation and hopefully not form part of that one in five who forget - because if they do, that that will be when they are at their most vulnerable.”
Changes in the business, such as a large business purchase, a new business model or upgrades to systems, represent an important time of review for younger business owners, the report found. Among owners under 45, 37% review their insurance following a business change, compared to just 18% of those over 45.
Medium sized businesses (between 20 and 200 employees) also focus on their insurance following a business change, at 62% - even more so than their smaller counterparts at 42%.
“If you understand when your clients are making big changes in their business, then you’re better placed to provide advice at a time when they’re likely to be reviewing their insurance arrangements,” Pagano said.