Despite being aware of the option, most companies opt for insurance cover for only a few types of risks. Cyber liability risk coverage is also yet to see huge penetration, finds a business risk survey by ICICI Lombard General Insurance Company.
The survey — across 292 companies, spanning technology, banking, financials services and insurance, steel, cement, pharma, petro & energy, engineering & manufacturing — revealed that many industries that have high exposure to certain risks do not have adequate cover.
The survey said: “Penetration of general insurance products is limited to coverage of a few key risks while there is a predominance of direct purchase from insurance companies.” General insurance cover is perceived as critical across sectors, including service-oriented and emerging sectors.
Sanjay Datta, chief-underwriting, reinsurance and claims, ICICI Lombard General Insurance, said: “The business environment is changing and so are the risks associated with running operations. It is important that companies realise they need to cover their operations against various risks even as they pursue growth through incremental as well as disruptive modes. This survey is an initiative to help companies realise the importance and impact of risk management in operations.”
The study revealed that while high impact-high propensity risk is more for smaller firms, larger ones consider employee health and accident-related risks as high impact-high propensity.
Only 44% auto and auto ancillary companies opted for product liability covers while only 27%of FMCG companies went for commercial general liability insurance. “While most companies have group medical insurance, accidental insurance and insurance against damage to their asset or machinery, they have limited protection against liability related high-impact risks. In fact, new-age risks such as cyber liability as well as director & officers liability have been opted for by few firms,” said the survey.