Survey Reveals Low Insurance Awareness Among Indian Small Businesses

ENA MSME 2024-08-13 13:25:05 New Delhi, Aug 13 (KNN) In a startling revelation, a recent survey has uncovered that despite forming the backbone of India's economy, the vast majority of Small and Medium Enterprises (SMEs) and Micro, Small, and Medium Enterprises (MSMEs) in India remain critically underinsured. According to the Ministry of Micro, Small, and Medium Enterprises' 2023 Annual Report, the SME and MSME sector comprises over 63 million enterprises, contributing a substantial 30 per cent to India's GDP and employing more than 110 million people. However, a report by the National Institute for Micro, Small and Medium Enterprises (NI-MSME) paints a concerning picture: less than 10 per cent of these enterprises have adequate insurance coverage. The gravity of this situation is further highlighted by an ICICI Lombard survey, which found that 70 per cent of SMEs in India have faced at least one business-related risk in the past three years. Despite this, less than 20 per cent have comprehensive insurance coverage to mitigate these risks. Sajja Praveen Chowdary, Head of Policybazaar For Business, emphasises the critical need for tailored insurance solutions. The diverse nature of SMEs and MSMEs means their insurance needs can vary significantly, Chowdary explains. He outlines several essential types of insurance for these businesses, including property insurance, general liability insurance, and the increasingly important cyber risk insurance. The article highlights the role of digital platforms in simplifying the insurance process for SMEs and MSMEs. These platforms offer tools for comparing products, managing policies, and accessing educational resources, making it easier for businesses to navigate the complex world of insurance. However, a significant challenge remains in educating SMEs and MSMEs about the importance of insurance. Many small business owners still view insurance as an unnecessary expense rather than a vital investment. Industry experts call for collaborative efforts between government agencies, industry associations, and insurance providers to raise awareness and provide financial incentives for insurance adoption. As India aims to become a USD 5 trillion economy, ensuring the resilience of its SME and MSME sector through adequate insurance coverage is not just beneficial for individual businesses, but crucial for the nation's economic future. The message is clear: for India's small businesses, insurance is no longer optional—it's a necessity for survival and growth in an increasingly risky business environment. This article presents the key information from the source document, framed in a journalistic style that highlights the importance of the issue, provides relevant statistics, and includes expert commentary. It aims to inform readers about the critical state of insurance coverage among India's SMEs and MSMEs, and the potential consequences for the country's economy. (KNN Bureau) 38953 https://knnindia.co.in/news/newsdetails/msme/survey-reveals-low-insurance-awareness-among-indian-small-businesses 2024-08-13 13:25:05 knnindia.co.in Survey Reveals Low Insurance Awareness Among Indian Small Businesses