The SME sector is a critical nerve center for the Indian economy. Most small businesses tend to be entrepreneurial ventures where the promoter has either invested their own savings or borrowed funds from relatives to start their dream venture. SMEs are especially vulnerable to risks threatening the venture with surprisingly, the employees of SMEs do not have health covers or other core property risks like business interruption, fire, marine etc. Lack of awareness, coupled with thin margins, makes insurance a low priority. Business owners often neglect insurances and moreover the law does not mandate. While insurance can be an expensive investment in the tight budget an SME runs, it could save huge amounts if a disaster ever strikes.
Purchasing insurance is nothing but purchasing protection. Though the extent of shock absorption in the time of loss varies from policy to policy, the financial cushion insurance provides promises peace of mind.
Some of the insurance covers for the small business are summed up below:
Protection during cash flow crisis
Risks due to third parties:
Business Interruption Insurance:
Worker’s Compensation Insurance:
Accounts Receivable Insurance
Equipment Breakdown Insurance
Office and Shop Insurance:
Stock & Goods Insurance: