When considering insurance, all SMEs should consider using an insurance broker to get them the best deal and help them navigate the sometimes complex insurance environment. Research from the British Insurance Brokers’ Association (BIBA) recently found that 69% of brokers have secured an increased payment for a claim on behalf of a client following an initial lower.

Key challenges

Despite the fact that the economy is picking up, SMEs still face a number of challenges to ensure that their businesses both saves money and grows. Earlier this year, BIBA researched these key challenges, with the help of Populus and found that there was a lack of knowledge about business insurance, that back office tasks distracted SME leaders from focusing on their core business, a lack of talent and skills, and rising supplier costs.

Recent research by BIBA found that on average, leaders of SMEs work a 15 month year, which equates to an extra 10 hours a week on average. When it comes to insurance, SMEs spend 73 minutes per week handling insurance, valuable time that could be spent elsewhere.

Steve White, Chief Executive of BIBA commented:

“Insurance is the third most time consuming back office task, taking up more time than IT. SMEs could benefit from the support of a broker to save them precious time to get on with growing their business. An insurance broker will have access to a wide choice of products, can give advice, represent businesses during claims and provide risk management advice relieving the burden on the SME.”

There is a lack of engagement from SME leaders on commercial insurance, with over one quarter (29%) of leaders never reading their full insurance policy. Female leaders faired better than males, with 30% of them always reading their policy, compared to their male counterparts where only 16% of them taking the time to always read their policies.

Steve White said: “As SMEs are the backbone of the British economy, it is essential that their leaders are fully aware of the insurance cover that their business has and the easiest way to do this is to use an insurance broker. Brokers can help SMEs save time and take the guesswork out of insurance documentation and fully explain the business’ cover.”

The basics: Insurance cover for SMEs

Insurance is a critical part of an SMEs business continuity system. It is about knowing:

  • What you’re legally required to have: Making sure that you abide with the law
  • What you really need to have: Taking out the essential cover for your type of business
  • What you may want to consider having: Deciding on any appropriate extras

If you need help looking for suitable insurance, you can use BIBA’s Find a Broker service either on 0870 950 1790 or at www.biba.org.uk