Sourcing for finance to resuscitate one’s businesses after a mishap, or replacing a damaged asset can be devastating, especially, at a time when citizens have little or no disposable income.
For instance, most businesses that suffered severe and mild damages during the last EndSARS protests are still nursing the wound several months after while some died a natural death. Similarly, the pandemic has contributed to downward spiral of the nation’s economy, ruining most businesses.
But, there are lots of microinsurance products that could protect individual businesses, especially, Sma
ll and Medium Enterprises(SMEs) against all the aforementioned risks.
Microinsurance is the protection of low-income people against specific perils in exchange for regular premium payments proportionate to the likelihood and cost of the risk involved.
The head, bancassurance and distribution, Old Mutual Nigeria, Dumebi Okonkwo, says it was pathetic that during the last EndSARS protests, several SMEs suffered heavy losses arising from vandalism and destruction of their business assets and only a few have assets and properties insured.
Importance Of Insurance
For SMEs, she notes that risk assessment is critical to mitigate financial loss, adding that insurance companies such as Old Mutual have different insurance products to insure SMEs in the country.
The chairman, Nigerian Insurers Association(NIA), Mr. Ganiyu Musa, advised businesses to seek protection from insurance firms who have different products for various degree of risks that could affect businesses.
Musa, who is also the group managing director/CEO, Cornerstone Insurance Plc, promised that underwriters will not hesitate to pay claims arising from such risks as soon as they found the claims to be genuine, urging entrepreneurs to manage their finances effectively by adopting insurance coverage.
Microinsurance Products For SMEs
To this end, some of the following products can be handy for entrepreneurs in the country, namely:
Fire And Risk Insurance Plan
This is a vital insurance plan that covers your business against, earthquakes, fire outbreak, tsunami, flood, social unrest, intentionally inflicted damages that may occur in the line of your business.
Professional Liability Insurance Plan
This covers business owners from claims or legal liabilities from their clients.
Product Liability Insurance Plan
Is meant for SMEs in Nigeria and protects their business from liabilities, claims or damages that may erupt from the use of its products.
Business Interruption Insurance Plan
Natural disaster or bad government policies are the various issues facing SMEs. Small business usually goes through financial crisis during course of these issues. Business interruption Insurance plan compensate this business for its lost income at such time.
Commercial Property Insurance Plan
This covers all business equipment, signage, inventory and furniture in the event of a fire outbreak or during a crisis.
Goods-In -Transit Insurance Plan
This is for those running SMEs in Nigeria focused on hauling of goods from one city to the next, then one would consider protecting goods on the road with this kind of insurance plan.