38% said they saw no need for taking out a policy
One in 20 SMEs do not have insurance, according to research by LV= Broker.
The study revealed that up to 200,000 SMEs are trading without insurance, and a further 15% have no financial contingency plan in place should they be unable to trade.
Reasons for not having insurance included not seeing a need for cover (38%), affordability of cover (21%) and ploughing all profits back into the business (10%).
LV= Broker commercial lines director Mike Crane said: “The research shows that thousands [of SMEs] are leaving themselves vulnerable to prosecutions and fines by the Health and Safety Executive for not having appropriate insurance in place.
“Getting the right advice on cover from a specialist insurance broker is invaluable for business owners and can make the difference between being able to continue trading or not should the worst happen.”
The research comes at a time when the SME sector has a promising future in the UK, with 75% of SMEs maintaining or growing turnover over 2014.
Furthermore, more than a fifth of SMEs included in the study had taken on more staff during 2014, with 4% employing their first member of staff.