Business Insurance Trends

Small businesses are becoming more receptive to alternative purchasing routes such as the telephone and the internet for buying insurance cover. And, when they do, they expect simplicity. They want to be able to choose from a selection simple solutions that are already packaged to accommodate the risks that are relevant to their industry or business.

“It makes buying business insurance less intimidating and confusing,” says Bradley Du Chenne, spokesperson for Dial Direct Insurance.

According to a survey of SMEs in the United Kingdom (UK) by research company, Datamonitor, 34% of small businesses are willing to arrange their insurance over the phone. 46% of the respondents also indicated that they only purchased packaged insurance products in 2008. The majority of SMEs that said they would buy business insurance online were inclined to buy less complex products.

“We expect that the picture in South Africa is pretty much the same. The direct channel has become a major distribution platform for motor and household insurance and SMEs are also recognising the benefits

“SMEs are more open to the idea of purchasing business insurance direct due to speed and convenience, and they are becoming increasingly price-sensitive thanks to the recession.

"SMEs are more open to the idea of purchasing business insurance direct due to speed and convenience, and they are becoming increasingly price-sensitive thanks to the recession.

“The direct channel, specifically the internet, will continue to gain prominence as a purchasing route for business insurance in this country because it saves companies time and money.

“There is massive growth potential for direct insurers that are able to answer to the demand for affordable, no-fuss, appropriately-packaged business insurance products for SMEs,” says Du Chenne.

In South Africa, SMEs account for over half of the national economic output and yet, despite the size of the flourishing SME market, there are few short-term insurers offering products that are tailored to the specific insurance needs of smaller businesses.

Dial Direct Business Insurance caters for SME-specific insurance needs. It is divided into four segments namely Business, Office, Practice and Professional. Each segment has a specially-tailored product that provides cover relevant to the needs of the businesses that fall within that category. Each product contains the correct combination of traditional policy sections to ensure that a small or medium business is adequately looked after from an insurance point of view. This means that there are no superfluous clauses, which in turn means that there are no unnecessary premium costs.