SMEs note rising insurance costs
More than half of SMEs say insurance and workers’ compensation costs have increased noticeably in the past year, a new survey shows.
About 37% report significant rises in utility costs, 53% in technology costs and 51% in wage bills, according to the SME Association of Australia study.
Chairman Craig West says it shows that while SMEs are upbeat about future prospects, they still have concerns about economic and bureaucratic “anchors” on the sector.
He says governments at all levels must cut bureaucracy, red tape and related costs, so Australian business owners can compete internationally and employ more people.
“I regard the rise in insurance and workers’ compensation costs as high,” Mr West told insuranceNEWS.com.au. “It’s in our top three survey categories.”
He says the association will broaden its insurance partnerships and forge a new relationship with CGU, partly as a result of the survey findings.
The association currently has a partnership with WFI Insurance, which has been sold to IAG. Mr West is uncertain whether the sale of Wesfarmers’ underwriting business to IAG will affect the partnership.
“We hope with CGU we will be able to get more savings, efficiencies and improvement in insurance offerings for our members.
“It’s not necessarily just about cheaper insurance – it’s also about better insurance.”
The survey responses came from about 1000 of the association’s 22,800 members across 75 industries.
About 62% of SME respondents say compliance and bureaucratic issues make business difficult.
Some 71% cite economic conditions as a problem, 53% cashflow and 31% the high dollar.
More than one-quarter of respondents expect to employ more people in the next year.
“The majority of SMEs surveyed expect both the Australian economy and prospects for revenue growth to improve over the next year,” Mr West said.