The South African Insurance Association (SAIA) has emphasised the need for Small, Medium, and Micro Enterprises (SMMEs) to prioritise non-life insurance products and services.<\/P>
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In a statement, the Association said the recent Covid-19 lockdown regulations, looting, and civil unrest experienced in South Africa highlighted the fundamental role that non-life insurance products and services play in sustaining SMMEs.<\/P>
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It said according to recent research, approximately 89 percent of businesses impacted by the looting were SMMEs, 62 percent of which did not have business insurance. Only 5 percent of the businesses that closed their doors in recent months had business interruption insurance, leaving an operational funding requirement of over R16 billion needed to recover the sector.<\/P>
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\u201cThese drastic figures prove that SMMEs need to better understand business risk and insurance. Whether your business is big or small, non-life insurance is key to ensuring the longevity of your business,\u201d said the Association.<\/P>
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Themba Palagangwe, the Association\u2019s General Manager for Governance and Transformation, in the statement said: \u201cWhen running a business, unforeseen negative events can occur. An appropriate insurance policy is one of the things that determines between total closure of the company or its survival. Insurance is there to put back the business where it was before an unforeseen event happened.\u201d<\/P>
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In the statement, SAIA highlighted risks that can be insured by small businesses. These include:<\/P>
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Business assets: These can be insured under a commercial policy. The cover can include theft, fire, flooding even accidental damage. Assets such as buildings, vehicles, machinery, stock, office content, electronic equipment etc, can be insured.<\/P>
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Money: If your business takes payment in cash, you can insure the money you receive as it is exposed to theft by employees and outsiders.<\/P>
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Liability cover: To cover liability claims that the company may face. Liability coverage pays for property damage and or injuries to another person caused by an accident in which you’re at fault.<\/P>
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Public liability: A business can insure itself against third party liability such as customer falling and injuring themselves whilst in the store. For example, if a customer enters your flower shop, slips on your wet floor and breaks their leg, your third-party liability insurance can help cover the cost of their medical bills.<\/P>
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Product liability: The products manufactured and sold by the company may cause damage the customer items.<\/P>
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Employers\u2019 liability: Staff members may decide to sue the company for ill-health due to injury at work.<\/P>
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Legal expenses: The company can take legal expenses policy to defend legal matters.<\/P>
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Riot Cover: A business can also insure against losses that occur because of civil unrest, protests and riots. This cover is issued by the South African Special Risks Insurance Association (Sasria) and may be taken as an extension to a business\u2019s current commercial policy.<\/P>
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\u201cAs a business owner, you need to re-evaluate your business’s risk profile insurance needs frequently, more so if your business has changed over the past year. Start by updating your insurance policy details. Inform your broker and adjust your policy according to your business needs. This will help you tackle any surprises in the event of a claim\u201d said Palagangwe.<\/P>
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Source: South African Government News Agency<\/P>
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