Survey finds small businesses prefer to meet their brokers and deal with the same person, but rate rises are not understood
In a boost for brokers, a new survey has found that the majority of small and medium enterprises (SMEs) prefer to meet their suppliers face to face.
The survey, conducted by Holden Pearmain Research on behalf of Norwich Union (NU), asked 500 SMEs about their attitudes to insurance. It found that 70% of the SMEs surveyed prefer to have face-to-face contact with suppliers, while 77% prefer to deal with the same person in their business relationships.
The survey also found that close to 50% of SMEs are worried about the availability of insurance for their businesses, and 45% consider the price and availability of insurance to be a considerable business risk.
But the industry's message about the impact of the growing compensation culture on the cost of insurance seems to be failing to get through. Just 40% of those surveyed expect insurance premiums to increase each year, despite acknowledgement that many SMEs increase their own business prices each year.
However, the survey also found that SMEs were not prepared to sacrifice the level of cover for a cheaper price, with 66% of respondents not prepared to lose benefits or take a higher excess to secure a lower premium.
In line with this finding, only 15% said they bought the cheapest insurance they could find, and just 12% were worried that they were underinsured.
Of the factors most effecting SMEs, changes in government legislation were a top concern, with 72% responding that legislatory changes create more problems than solutions. But while the majority find professional advice expensive, 50% said their need for advice would increase over the next few years.
NU head of knowledge and customer development Debbie Heaney said this presented an opportunity for the industry. She said: "Keeping up with the raft of new legislation can be extremely onerous for an SME. For insurers and particularly brokers this can provide an opportunity to position themselves as risk advisers as well as sales people."
