Small Business Insurance in South Africa

Posted on August 17th, 2020
Articles

Being your own boss has its perks, but for your business to thrive as it should, you need to protect it. Having the right small business insurance cover will leverage success for your business, should an unfortunate event occur.

The emergence of a global pandemic and a national shutdown has resulted in the most vulnerable sector in South Africa, small businesses, being the hardest hit.

NSBC founder and CEO Mike Anderson, in an interview with IOL, said that the COVID-19 pandemic may seem like a once-in-a-lifetime event, but the reality is that an emergency could come along to disrupt any small businesses at any time.

“Using what’s been learned during the pandemic to prepare for the next crisis could help business owners insulate their businesses from future shocks,” Anderson said.

How business insurance protects you

Having business insurance cover is important for small businesses as they cannot afford to take a major hit. Insurance covers and protects you and your business against unforeseen events, including, but not limited to, the following:

  • Financial loss: cover against any financial loss the business may encounter.
  • Legal action: as a small business, there is a risk of customers and/or suppliers taking legal action against you.  Legal business insurance cover can help with handling any legal battles that may occur.
  • Survival of the business: in the event that a catastrophic event occurs, such as theft or fire damage, business insurance policy cover will cover the damages.
  • Business interruption: when an unexpected event, such as Covid-19 lockdown, brings your business to a halt.
  • Reputational damage: covers the business in the events of damage to the company’s image or reputation. This includes any reputational damage as a result of social media, website hack,  etc.

Industry-specific cover

According to Business Insurance it is advisable that you choose insurance cover that is specific to the industry that you operate in. Here are some examples of industry-specific cover:

  • Industrial Insurance: covers glass facilities, racking and shelving companies, automotive industries and factories.
  • Mining Insurance: covers gold mines, platinum mines and coal mines.
  • Retail Insurance: covers hair dressers, beauty salons, coffee shops, restaurants and florists.
  • Handyman Insurance: covers plumbers, electricians, builders, carpenters, mechanic and security installations.
  • Transport Insurance: covers trucks, buses, aircraft’s, motorbikes, deliveries and couriers.

Business risk to consider

Business insurance coverage prices may vary as it all depends on risk. The overall cost of your cover will depend on some of the following factors:

  • Risk: there are certain industries which, by their nature, have higher risk, for example construction and manufacturing.
  • Location: the location of your business can affect your commercial insurance rates.
  • Claim history: previous claims can result in higher insurance costs.

Business insurance can be overwhelming, especially if you don’t know where to start.

SME South Africa did the research and compared three business insurance options – 1st For Women, MiWay and Budget Insurance.

1st For Women – For women-owned enterprises

ABOUT 1ST FOR WOMEN

1st for Women provides insurance specifically designed for women. They offer vehicles, home, life, business, building, portable possessions and personal insurance. 

FEATURES

1st for Women offers various tailor-made options depending on each individual business. They also offer business vehicle insurance for business vehicles which can also be added to any of your other business insurance policies.

BENEFITS

  • Tailor made and takes into consideration individual business needs. 
  • Business assist which provides access to experts to help you with your business.
  • Emergency medical assist available 24/7/365 to assist with medical emergencies.
  • Office assist is available around the clock for office emergencies.
  • Access to professional advisors, mentors and specialists who are business experts. 

MiWay – Customer focused 

ABOUT MIWAY 

MiWay is a licensed short-term insurer and financial services provider, offering customers a range of non life insurance products including motor, household, homeowners, business insurance and liability cover.

FEATURES

Their business insurance offering consists of a number of features including, motor insurance, business property, business interruption, personal accident and MiBusiness assist. Cover is tailored to fit each individual business. 

BENEFITS

  • A fixed standard excess which may be adjusted to suit your financial needs.
  • Access to emergency roadside and office assistance services.
  • Cover is available outside of SA and includes various African territories.
  • Wreckage removal, towing and storage of business vehicles.
  • Their insurance cover is made to suit your needs and your budget.

Budget Insurance – Low premiums

ABOUT BUDGET INSURANCE

Budget Insurance is known for offering great insurance products at affordable prices. Their focus is car, home and business insurance.

FEATURES

Budget Insurance’s business insurance offering includes cover for the following, motor, fire, business interruption, buildings, office contents, theft, electronic equipment, business risk cover and more.

BENEFITS

  • Their business assistance benefit provides free 24/7 online and telephonic support.
  • Biz Assist is included as part of your cover, at no extra cost to you.
  • Access to advice on how to grow your business and specials.
  • They offer a Cash Back benefit if you remain claim free for two years.
  • High on value, low on cost and they offer cover and insurance advice.

Disclaimer: Please note that some of the links in this article are affiliate links and SME South Africa will earn a commission if you purchase through those links. All recommendations have been carefully considered and they are resources SME South Africa has found helpful and trustworthy.