Reliance General Insurance has started a new vertical for SME (small and medium enterprises). The company is looking to take the assistance of technology to have packaged products to meet their specific needs.
The insurer and several others are now beginning to have separate verticals and trained teams to look into the needs of SME clients, Rakesh Jain, CEO, Reliance General said, "We plan to have about 40 dedicated personnel in the SME vertical who would look into this business. We already have 10 people in the team."
SME insurance cover is seeing a rise in India, with respect to the products offered and the companies that offer these products. Since SMEs are under a threat from disruptions to life and property from natural and man-made disasters including fire, floods, earthquake and terror attacks.
Insurance executives said that even the smallest of business interruptions could make a big hole in an SME's balance sheet. Hence, more number of customised products are being offered to the companies. Most of these are niche specialised covers to meet unique needs of each company and the segment that they are into.
An SME cover gives the flexibility to pick & choose covers of your choice in a single policy. Here, the sum assured depends on the size of the business and its needs. The standard package policies include cover from burglary, equipment breakdown cost, accident cover, workmen's compensation apart from public liability and recall covers for some segments like auto components.
Sanjay Datta, head of underwriting and claims at ICICI Lombard General Insurance explained that with banks putting a condition to have adequate protection for getting funds, SMEs are more forthcoming to take a policy. He added that they also have a dedicated channel which looks into the SME business.
It is not just insurers, but brokers as well, who are specifically looking to set up dedicated services for SMEs. T L Arunachalam, director, Global Strategy and Special Projects, Bharat Re-Insurance Brokers said that they hold regular discussions with SMEs, to find out whether they are adequately insured or whether the cover that they have taken is adequate to cover the risks that they may be subject to.
At present, SME insurance comes under package insurance for corporates which forms a small part of the overall portfolio of the general insurance industry. Going forward, the industry officials expect the business to form 20-25% of their overall portfolio.
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