This silly season, insurance brokers are being urged to reach out to SME clients, especially those in industries like retail, hospitality and beauty. Insurtech BizCover said they may be facing increased risks and be left underinsured during what is often the busiest time for SMEs, a news release noted.
“Underinsurance is a year-round issue for small businesses, but summer trading can make these coverage gaps more serious,” said Jane Mason (pictured above), BizCover for Brokers head of intermediated business. “It’s essential that brokers are able to help SMEs identify and address areas where they do not have adequate cover.”
A 2022 Vero survey found that while more than half (52%) reported being completely covered by insurance, about 57% of the SMEs reported being “mostly covered” or “partially covered” for risks. Also, out of the 57%, about one-third (34%) admitted to having no plans if something damaging happened to their business.
The findings of the survey, said BizCover, indicate a need for broker education and advice to help SMEs avoid underinsurance. “Bringing awareness to common causes of underinsurance—including identifying risks and understanding different types of insurance—can help close the gap by breaking down a topic that is normally perceived as complex,” the release said.
BizCover for Brokers noted brokers are the key to ensuring SMEs have the right cover and that their policies can handle the November to February rush. “There are areas where end-of-year trading may prompt policy adjustments,” said Mason. "Contents cover is a prime example—businesses may store more stock in the lead up to Christmas and their policy should be reviewed to ensure they are adequately covered for the increase in stock.”
Among the considerations, reviewing for business interruption cover to ensure adequate protection during peak trading periods. An unplanned closure during the busiest time of the year might impact a business’ ability to survive future trading downturns, the release said.
Mason also advised considering adding new policies like cyber liability to enhance preparedness in case of cyberattacks or breaches. She said these issues could bring operations to a standstill and cause business losses.
BizCover for Brokers encouraged brokers to consider taking advantage of technology in helping clients get protection fast. It noted the BizCover for Brokers (B4B) platform has helped brokers compare competitive business insurance quotes from seven leading insurers and for multiple products from single data entry. This enables brokers, said the release, to the save time and effort of filling out multiple long proposal forms and chasing down individual insurers.
“The B4B platform is designed to streamline the binding process for brokers who embrace technology,” said Mason. “Instant quotes and binding are game changers for addressing SME underinsurance risks in the lead up to the end of year break and all year long.”
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