When insurance and risk management veteran Tom Pegues decided to launch Insuri - a new small business risk and insurance consultancy - in the middle of a global pandemic, some industry peers may have (quite understandably) questioned his timing.
Mid-pandemic is “certainly not the ideal time” to launch a business, Pegues admitted, especially when a lot of small business owners in the US (Insuri’s target market) are suffering from cash flow issues. But the timing worked out well for multiple reasons.
Insuri is a small business risk management and insurance consultancy website, with the aim of bringing large business risk management expertise to small business owners. Oftentimes, small business owners lack an understanding of their unique risk and how they’re covered by insurance, according to Pegues.
“They’re completely left in the dark regarding what insurance to buy, and what coverage they actually need for their unique risk profile,” he told Insurance Business. “With Insuri, we wanted to bring all this expertise to the small business community so they can stop worrying about insurance and can start focusing on the most important parts of their business.
“We’ve been working on Insuri for quite some time. Obviously, mid-pandemic is not the ideal time to launch a new business, but it has actually turned out ideal. There are a lot of small businesses in the US who are seeking to know whether or not their insurance coverage actually provides some level of protection, especially in terms of business interruption coverage. We’re seeing a lot of small businesses looking towards their insurance companies, or even filing litigation against their insurance companies, seeking coverage for business interruption.”
The COVID-19 pandemic has “highlighted some of the deficiencies” in the small business insurance space, Pegues argued. Historically, a small business would purchase an insurance policy, and then they probably wouldn’t hear much from their broker or insurer until renewal. That’s because brokers and insurers tend not to get much return from servicing small business accounts.
“That’s why I decided to create Insuri,” said Pegues. “We actually understand small business risk, and we understand how the policies work for each specific business. That’s really the key because not all business risks are equal. There are certain things that small business owners need to know specific to their risk profile, and we can offer that to them.
“Of course, small business owners can access a certain level of information from their insurance brokers, but insurance brokers also vary in their expertise and their particular silos. For instance, a small business might have one insurance broker that put together its package policy, which includes its liability and property insurance, but that broker might not know so much about professional liability or employment practices liability, discrimination and sexual harassment risks. It’s our aim to bring all of that together for small business owners.”
As well as highlighting the general lack of insurance support for small business, the coronavirus pandemic has also brought some key coverage issues into the spotlight – business interruption insurance and the general lack of coverage being the big-ticket item here.
“Another key coverage that COVID-19 has highlighted is workers’ compensation insurance,” Pegues added. “Workers’ compensation insurance traditionally has excluded colds and viruses, and clearly COVID-19 is not your typical common cold or flu virus, so it needs some level of protection. What we’ve been seeing is that governors in various states across the country have been slowly giving back coverage to certain employees. They’ve been expanding the workers’ compensation coverage to include essential workers and healthcare workers, but we need to extend that coverage to include all employees.
“I understand, like the business interruption argument, that it’s another risk profile that insurance companies did not consider or price for, so there needs to be some sort of backstop or solution for this. There are a lot of small businesses that purchase workers’ compensation coverage through various commercial insurance companies, and so it’s another risk that we all need to put our heads together and come up with a really good solution for. We need to use all of the resources at our fingertips to build the law around protecting all employees, regardless of the size of the business.”