This content requires Adobe Flash Player version
or later.
Either you do not have Adobe Flash Player installed,
or your version is too old,
or there is a problem with your Flash installation and we were unable to detect it.
that enforces SMEs owners/managers to have insurance policies that cover their employees and their assets. This is a way to ensure that SMEs are protected from any form of crisis that may result in their closure and resulting in the owners and their employees going to the job market and adding on to the list of the unemployed.
MANAGERIAL RECOMMENDATIONS
The study has shown that there are many factors that influence the business relationship between SMEs and insurance providers. It is recommended that insurance providers should increase their interaction with SMEs. They need to hold frequent workshops for SMEs where they can get a chance to inform them of their various product offerings. Insurance providers can hold research programmes twice a year, where they can be able to find out what sort of insurance cover they need to offer SMEs and premiums they can afford.
One of the major factors that influenced the relationship building process between SMEs and insurance providers was the reliability of the insurer (96%). Insurance providers can use workshops, road shows and they can hold summits where they can invite SMEs. This will give them a chance to interact with their clients and create a platform where they can provide information concerning their premiums and pay outs when a claim has been made. They can also determine the needs of their clients. Insurance providers should build a relationship with SMEs and trust should be the foundation. They should train their staff on how to deal with SME owners/managers, their products and payment plans as well as claims. This is all part of the relationship building process.
The study revealed that 72.1% of the SME owners-managers want to be given insurance related information workshops. Insurance providers can therefore, hold frequent workshops and information sessions with SME owners-managers so that they can have an understanding of the type of insurance policy covers that their businesses need, the premiums and how insurance claims can work for them. Based on the number of SME owners/managers who received insurance related information workshops for , insurance providers are not holding needs analysis with their client (SMEs). It is required under the South Africa Financial Advisory and Intermediary Services (FAIS) Act 37 of 2002 that they hold educational workshops, to enable them to get the needs of their clients and offer them products that suit their financial bracket. This is in breach of the requirements stipulated by this Act. This suggests that insurance providers are not complying with the code of conduct that is provided in the Financial Advisory and Intermediary Service Act of 2002. The government needs to ensure that insurance providers follow the law and if they fail to meet the requirements, stiffer penalties need to be introduced. The government can also look into giving incentives to insurance providers so that they develop insurance products that suit the particular needs of the SME sector. This would result in a more stable and sustainable SME sector which will create jobs and help with the fight against poverty.
THE RELATIONSHIP BETWEEN SMES AND INSURANCE PROVIDERS IN NELSON MANDELA METROPOLITAN AREA, SOUTH AFRICA 801