Lack Of Insurance Leaves Many SME'S Open To Loses |
LACK OF INSURANCE LEAVES MANY SME’S OPEN TO ‘CRIPPLING’ LOSES.
An independent study shows that many Small and Medium Enterprises (SMEs) are leaving themselves wide open to potential crippling losses and legal claims amounting to over £3billion, by failing to have the right level of business insurance.
The research from Premierline Direct, the business insurance specialist, revealed that nearly one in three (30%) of the business owners do not have business insurance at all. This is despite the fact that over half are concerned about the growing ‘blame and claim’ culture. Only 34 per cent of SMEs have employer’s liability cover, which is compulsory if the company employs anyone, and less than one in six has business interruption cover.
While commercial legal protection may be offered as an optional extra to a standard insurance policy, only 17 per cent of entrepreneurs have this cover. With the average cost of defending an employment tribunal claim estimated to be around £9,000, it’s an expense that most businesses cannot afford to pay out of their own pockets.
Chris Little, managing director of Premierline Direct says that due to the majority of the UK’s small business in danger because of cash-flow problems, many businesses cannot afford to take risks, and owning business insurance is an crucial area that companies shouldn’t operate without.
‘It’s worrying news that company owners appreciate that they are putting themselves at risk but there is a significant gap in the level of cover they have, particularly in key areas such as employer’s liability, public and products liability and business interruption cover,’ he added.
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Posted On
27
August
2008
at
05:50
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