OVER 50% of small medium enterprises (SMEs) in the country are not insured and at risk of losing business due to various reasons such as fire, says AXA Affin General Insurance Bhd.
Its country head Emmanuel Nivet attributes the low insurance take-up rate to businesses’ view that insurance is not a priority as well as lack of education.
“With insurance, depending on coverage, it could cover theft, fire, products as well as natural disasters, but unfortunately, many view it as unnecessary, hence putting their whole business operations at risk,” he says on the sidelines of the AXA SME Challenge last week.
He adds that with the growth of digitalisation, SMEs can also tailor their cyber insurance according to their nature of business for coverage in case of a breach or data loss.
During the event, Entrepreneur Development Minister Datuk Seri Redzuan Yusof had said that SMEs should consider being insured as it could protect their business from losing out in any event and is a way to mitigate risk.
“The SMEs will be contributing to 41% of the gross domestic product by 2020, and this is huge. The risk is big,” he says.
Redzuan adds that the National Entrepreneurship Policy 2030 (NEP 2030) launched on July 11 will push SMEs forward and enhance productivity.
“It will also influence the budget allocation for SMEs in Budget 2020. It acts as a guideline to manage the expectations and outcomes from the SMEs,” he says. — Bernama