Getting started with business insurance
Business Insurance is not very popular amongst businesses in Nigeria. According to this article in the Guardian, Insurance only accounts for 0.3% of Nigeria’s Gross Domestic Product. Even while the insurance industry is valued at 520.1 trillion naira, the total penetration of insurance is 0.5%, This Day reports. These numbers are pretty abysmal in light of the rising potential risks businesses face in Nigeria.
Most SMEs in Nigeria actively avoid insurance due to the perception of cost. These business owners feel that insurance would cost them more in the long run. SMEs have long contributed massively to the GDPs of countries, up to 40% in Nigeria, according to PwC, even with the significant number of risks SMEs face.
Lekan Oyinlade, the GMD of Old Mutual Assurance, opines that ‘purchasing insurance covers serves as the best way entrepreneurs can be shielded from losses.’ We do not have to look too far to agree with him. Events of the October 2020 protests in Lagos have added a lot of context to the issue. Businesses across every level have seen the need for some sort of coverage.
Types of Business Insurance
Business insurance has become more prominent than it used to be. National laws often regulate insurance, so the types of business insurance available to entrepreneurs differ from region to region. We would classify business insurance into four major categories.
This classification of insurance protects the business against bad things that happen to people from a business’s activities. Successful companies often encounter many people in their value chain, and accidents happen. Liability coverage describes a package of insurance that tackles any liabilities.
- General Liability
- Medical Expense Liability
- Product Liability
- Employee Practices Liability
- Professional Liability
- Cyber Liability
Another aspect of business insurance is property coverage which protects the physical assets your business has; offices, equipment, data, documents, and even money. Natural elements, external agents, and malicious actors could damage your business’s non-human assets, so it is wise to protect your indispensable assets with insurance. Under Property coverage, we can find;
- Building Coverage
- Business Personal Property Coverage
- Specialized Equipment Coverage
- Data Compromise Coverage
- Money & Securities Coverage
- Business Income Coverage
- Equipment Coverage
- Forgery and Alteration Coverage
Your staff are your most valuable asset in driving your business through sustainable growth, and it is important that they are kept motivated. In Nigeria, the law states that employers with 3 or more staff are mandated to take up Group Life insurance for their staff, that pays out a sum assured to the family of the staff in the event of something adverse. Group personal accident and Group health insurance are also important benefits that employees deserve and can essentially boost productivity.
Your business is exposed to risks associated with labour. Disagreements between companies and employees are not strange. A series of events may lead to contract breaches, or something awful could happen to the company or worker that could cause harm. Worker’s Compensation coverage handles incidents where a worker would need the payment for injuries or damages. This category of insurance is usually tariff rated.
Transportation is critical to any organization; thus, auto insurance is one of the necessary insurance policies businesses undertake. Most companies and firms possess a fleet of cars that aid in moving workers from place to place. Instead of buying insurance for each car, businesses could buy one auto insurance for all of their vehicles as a package deal.
What is not covered by goods in transit insurance?
But, if we have said that there is “all-risk” insurance, how is it possible that there are circumstances in which our insurance does not cover us? Usually, this happens because the party that contracted the insurance acts maliciously for the insurance to pass on the amount, or one of the parties acts in such a way that the correct measures are not taken. A clear example can be a drunk driver who may spoil our merchandise.
In legal terms, good faith must prevail in a relationship between policyholders. Otherwise, our insurance may not cover possible damages or losses. Some of the situations that GIT will not cover are:
- Expenses incurred for the delay.
- Manifest vice.
- Inadequate packing.
- Negligent conduct of the carrier.
- Bad faith or fraudulent conduct by the insured.
Get Free Business Insurance
Getting insurance for your business
Contact YOA Insurance Brokers
YOA Insurance Brokers offers free advice on insurance coverage, risk engineering, and claims processing services both locally and abroad.
If you have any questions about Business Insurance, do not hesitate to ask us here email@example.com.
You May Also Like
HR and Insurance Brokerage
Group Life insurance coverage, also known as group life assurance, is one of the most important and cost-effective employee benefits you can offer to your employees.
How does it work?
Cyber Security Risk Management
Cyber Security Risk Management is becoming increasingly important as business use data for their operations and run most of their operations in the cloud. The
Managing your investment risks in uncertain times
Learn how to protect your business with these notes from our webinar in September.
Getting started with business insurance
Doing business in Nigeria carries a lot of risks. What better way is there to protect yourself from risk than to get business insurance?
Why You Need Business Insurance
Subscribe Now Share on facebook Share on twitter Share on linkedin Business Insurance provides safety Because Business Insurance acts as a safety net when something
1. INTRODUCTION YOA Insurance Brokers Limited (“YOA”) is committed to ensuring its compliance with the requirements of all relevant data laws globally and in Nigeria.