Small businesses 'cutting back on insurance' due to downturn

Date: 19th May 2009

Growing numbers of small businesses are opting to cut back on their insurance as a result of the current economic climate, it has been revealed.

While it has already been reported that millions of consumers are choosing to do without travel or health insurance in a bid to cut back on their overheads, the British Insurance Brokers Association (BIBA) has now stated that small businesses are increasingly adopting such a money-saving policy, despite the fact that it could prove disastrous in the long-run.

According to the organisation, more than half of the brokers it surveyed reported witnessing their corporate clients reduce their levels of protection

BIBA chief executive Eric Galbraith added: "It's not necessarily just cutting back on insurance, it might be cutting back on maintenance, areas to do with security, whatever it might be.

"That can immediately impact your business and it can impact your insurance should you have a loss. Be very careful. Make sure you talk through with your broker exactly what you want to do."

These comments come soon after the Home Office reported that non-domestic burglaries were up by four per cent over the final quarter of 2008 in comparison to the same period in the previous year.