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The Small Business a compelling case for growth in P & C Insurance.



A report published by the US Small Business Administration https://www.sba.gov/sites/default/files/advocacy/2018-Small-Business-Profiles-US.pdf as of 2018 there are more than 30 million small businesses in the US and increasing.

According to Verisk Analytics, the leading & most trusted Risk Assessment Firm (https://www.verisk.com/) small businesses market accounts for an estimated $100 billion of direct written premium.

These reports clearly underlines the existing market share of the Small Business Insurance and the significant market opportunity for Insurers and Technology Providers for Insurance.

The segment deserves a renewed and prioritized strategic focus to tap and serve this business effectively. Historically however because of the cost associated with underwriting, claim processing and distribution from a commercial insurance stand-point this segment of the business might have been under-served and  / or served with a product mix that looks like a retrofit and  may not be catering to evolving needs of the Businesses. Insurer's would also be naturally concerned about the overall ratios of profitability concerns due to the overheads of underwriting first and claims processing later. This is where modern technology solutions and solution providers for Insurance can play a key role. With automated underwriting and straight through processing based on pre-filled data they can bring down the underwriting costs. This would enable the Insurers to service the segment without having to worry about escalating under-writing costs.

Another area where technology can work wonders for the Small Businesses and Agents is by recommendation of innovative and relevant coverage mix which more closely covers the risk financing and risk transfer needs of the business. Having an automated risk assessment and comparing and contrasting the risk profile under consideration with risk profiles of similar category of Business can aid to identify any existing risks and coverage gaps faster and with data points. Identification of such coverage gaps or needs of course would be of tremendous value to any Small Business who can then make an informed decision of their coverage needs for the Business. The key is that this should be enabled by a medium of submission and assessment which is on finger-tips.

Another key space where Technology Providers can make an effective difference is seamless integration of the core systems with modern day Digital and Social media platforms. The much talked about concept of event based insurance and its enablers can also be extended to a digital distribution channel.

These are exciting times for all stake holders Insureds, Agents, Insrers and Technology Providers with every passing day new opportunities are being presented which can be tapped in to make the overall Insurance experience a genuine and true to the spirit contract of indemnity.

 -Pranay Dixit, AINS, AVP & Senior Solution Architect @ Majesco Ltd. www.majesco.com

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