Small businesses are suffering from the effects of crime, according to new research by Zurich UK. So brokers are being asked to help them beef up their security. Zurich's David Smith explains key findings from the research
CRIME has hit 36% of small and medium sized businesses over the past three years. Collectively, this has cost them more than £1.4bn, according to research from Zurich UK.
Results from the insurer's small to medium-sized enterprise (SME) index, which monitors confidence levels among SMEs on a quarterly basis, also reveal that the cost of crime is stretching from hundreds of pounds per year into thousands of pounds per year.
Exactly 49% of victims say that crime has cost them between £1,000 and £3,000 over the past three years.
Zurich UK commercial business manager David Smith said: "Crime is a serious problem for SMEs, but the good news is that they can take a few cost effective simple steps to reduce the threat of crime.
"The insurer has set out minimum security standards, but brokers are being asked to encourage customers to go beyond these to ensure they have robust security systems in place, and not just the minimum that is required for insurance.
"Our website also contains tips for companies on how to reduce the risk of crime, such as taking advice from local police crime prevention teams, structuring valuable stock displays to make them more difficult to access and keeping back-up copies of staff, customer and supplier records off site to minimise disruption after an incident."
Smith concluded: "We believe there is currently a great opportunity for brokers and insurers to work more closely with businesses to help them understand and address the issues they face today."
The latest findings also reveal that many are finding trading conditions difficult.
Indeed, 60% believe their markets are now more competitive than they were six months ago, with only 8% claiming that they are easier.
The two main reasons given for conditions becoming more competitive are new entrants (54%) and price wars (42%).
The newly published research shows that 54% are concerned about red tape and 39% about finding suitable new staff. These are slightly lower when compared to the corresponding figures for 2001, which were 56% and 42% respectively.
The report also reveals that late payment of bills remains a serious problem with only 7% claiming it has improved over the past 12 months. One in ten businesses believe the situation has deteriorated, while 83% said it had not changed.
Findings also reveal that 71% of SMEs are concerned about rising insurance premiums.
SMEs are not aware that good risk management can help them reduce premiums and cope with increased legislation.
Despite the fact that 47% of SMEs are worried about health and safety legislation, only 34% are concerned about the state of their risk management programmes.