Malaysia: More than 55% of firms lack business liability cover
Source: Asia Insurance Review | Aug 2017
Less than half (45%) of Malaysian small and medium-sized enterprises and large companies currently have business liability cover although 64% of businesses are aware of it, according to a survey by Australia’s QBE Insurance Group.
At the same time, both awareness and usage of professional indemnity insurance stood at 27% and 19% respectively, while public and product liability insurance stood at 31% and 21% respectively.
Some of the reasons given for why the Malaysian companies do not own business liability insurance, include: their businesses are too small and the costs are bigger than the risks (45%), budget issues (41%), and other business priorities (29%).
QBE Insurance (M) Bhd CEO Leo Zanolini said that amid the current economic challenges and increasing pressure to invest in new technologies, companies need to ensure they are safeguarding their business adequately.
“Many Malaysian companies only take action to address business liability risks after experiencing an incident,” he said.
Challenging business conditions to continue
The survey results show that over a third of Malaysian companies expect the current challenging business conditions to continue over the next 12 months. About 37% of the respondents predict a slowdown in their business, and 36% of them also foresee higher input costs and low profitability. 28% of Malaysian firms surveyed expect to see increased advancement investment in technology and innovation to impact their business.
In the past 12 months, the most frequent risks faced by Malaysian companies included legal and regulatory compliance issues (28%), loss of income due to business interruption (27%), staff injuries while working (24%), damaged or loss of inventory (22%), equipment breakdown (21%) and public or third-party liability due to issues with products or services (18%). A