Companies are increasingly risking insolvency by failing to renew non-compulsory insurance, say experts.
Cover in areas such as business interruption, theft and property damage are being dropped in order to compensate for the huge increases in insurance premiums, say insolvency expert Wilkins Kennedy.
Head of corporate recovery at Wilkins Kennedy Colin Wiseman said: "Without insurance, events such as damage to a company's inventory can easily push it into insolvency.
"Self insurance may be appropriate for a well capitalised FTSE-100 company, but for SMEs it is the kind of cost cutting tactic that is going to keep the owner-manager awake at night...Paying the extra premium is by far the most sensible option."
Wiseman added that it is not just company owners who should be concerned - anyone with a stake in the company, such as creditors and clients, should be worried.
