BizCover’s SME Insurance Price Index has unveiled a rare bright spot for the SME community amid the COVID-19 pandemic with insurance rates remaining flat for a third consecutive quarter.
Figures acquired from BizCover’s SME insurance platform showed a decrease of 0.4 percent in overall price levels from the previous quarter with some notable declines across the Trades and Retail industry segments.
Prices for insurance across its Professionals industry segment showed marginal increases largely attributed to seasonal fluctuations.
BizCover Managing Director Michael Gottlieb said the figures would be reassuring for SMEs who were already dealing with very difficult economic conditions.
“Prices in the retail sector have been decreasing since the second quarter of last financial year and fell a further seven per cent this quarter,” he said.
“Key sections of business pack insurance that are frequently used by retailers such Contents, Glass and Theft all showed noticeable price declines.
“The pandemic has arguably had the most significant impact on the retail industry and the continued downturn of business activity in that segment will likely put more downward pressure on rates.”
Mr Gottlieb said BizCover’s two other core industry segments, Trades and Professionals, had shown relative stability despite the changed conditions.
“Larger drops such as the 24 percent fall for Contents cover in the Trades segment are being offset by increases in the cost of Public Liability and Professional Indemnity in other industries,” he said.
BizCover’s index showed the COVID-19 crisis had most visibly impacted rates in the latter part of the quarter as trading restrictions began to take effect.
“Businesses that have managed to stay open during the pandemic are looking for ways to maintain business continuity and ride out the downturn,” Mr Gottlieb said.
“Insurance is an essential business expense and dealing with increased prices at time when cashflows are already under pressure would be very difficult for the majority of the SME community.
“The stability adds some incentive for SME operators to keep trading with the peace of mind that comes from knowing they’re protected.”
Want to know more? Download the full report here.