Wednesday, 20 May 2020

Like many business owners, you endured significant risk-taking to start and sustain your enterprise.

In Malaysia small and medium enterprises (SMEs) represent 98.5% of the market and an estimated 50% of those businesses are uninsured.  One of the main risks you should avoid is failing to protect your business properly.

Business protection is essential to avoid the negative financial consequences caused by catastrophic events. The right knowledge can guide you to make the best decisions for your business now and in the future. Let us share with you some common misconceptions people have about the various insurance options:

Misconception #1: Insurance is not necessary for small businesses

No matter the size of your business, it is crucial to protect the company you have worked so hard to build. Without proper protection, you may be at risk of damage from fire or flood and lawsuit claim.  The impact of a lack of such coverage could threaten the survival of your business should such matter occur.

The right business protection gives you peace of mind and allows you to focus on running your business successfully.

Misconception #2: Home insurance cover home-based businesses

Small businesses operating from home may be under the impression that their home insurance policy would also protect their business assets. This is not the case. Your house insurance does not extend to business losses.

Look into obtaining a business insurance plan to safeguard your home-based operation against lawsuits, liability claims and equipment like your I.T. or inventory.

Misconception #3: Private motor insurance cover claims for business use

Your motor policy only protects your private vehicle and do not cover damages or losses associated with collisions relating to business purposes. If your business inventories or materials are stolen from your vehicle or damaged in an accident, you will be at risk of losing it all without proper coverage.

It is advisable to consult your insurance agent regarding the best options for your business needs, especially if you deliver business goods using your private vehicle.

Misconception #4: I don’t need to change my plan

After operating your business over a period of time, you may have expanded your operations, employed new employees and introduced new products or services. It is fundamental to re-evaluate your coverage on a regular basis, to ensure that it is sufficient to protect your current business needs.

Try to learn and understand your policies options and current coverage a few months prior to renewal. Be financially prepared by having adequate protection provision against unexpected tradegies.

Misconception #5: My business is protected against cyber-attack

If you think your small business won’t be a target of cybercrimes, think again. Small and medium businesses are often easier targets compared to larger corporations due to their greater cyber security infrastructure.

Should you fall victim to such an attack, ensure that you are well prepared to tackle any business interruption with additional cyber-attack coverage such as liability and defence claims.

Companies should also be diligent by installing appropriate security measures and constantly monitoring various cyber risks, such as breach of data and sensitive information.

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