Economic Growth and Increased Exposure. Are your SME clients covered?

Ireland currently boasts the fastest growing economy in the Eurozone. Consumer and business sentiment is by and large positive, with consumer spending set to rise by 3.4%* in 2016, and unemployment at a seven year low of 8.6%* as of January this year. As this strong growth in the Irish economy continues, it’s worth thinking about the impact on the insurance requirements of your SME customers.

More than half* of Irish SMEs expect to see increased activity over the coming months. With this increase in activity may come an increase in risk exposure. Depending on the nature and scale of these changes, their current insurance cover may no longer be sufficient. When talking to your SME clients it’s worth considering how any recent or planned business growth affects their exposure.

Growing business, growing risk

The economic outlook is positive, and for many businesses conditions are right for expansion. Maybe they’re taking on new staff, whether in their existing offices or new premises. Perhaps they’re diversifying their business offering or increasing their exports. Whatever their growth strategy may be, it’s worth taking the time to consider the insurance implications.

The following issues provide a starting point for assessing the degree to which the client’s cover needs to be revised.

Property values

Higher costs of labour and materials translates to increased re-build costs and a higher Property sum insured will be required. Rents have also increased significantly in Ireland and will require a larger sum insured for Loss of Rent cover.

Increased turnover

Have they been doing more business recently or are they expecting to see increased turnover in the coming months? Increased trade often means increased employee numbers and wage roll. Higher turnover figures should also be declared.

Business Interruption

In the event of the SME experiencing business interruption, there is potential for greater loss and higher costs to reinstate the business. The Business Interruption sum insured should also be reviewed along with the period of indemnity, as the popular 12 month option isn’t always appropriate for individual businesses.

Assessing changing needs

With economic conditions ripe for Irish SMEs to expand and diversify, talking to your clients about the nature and scale of their plans will give you an indication as to whether their cover needs to be reviewed. Our team of expert SME underwriters are also available to discuss your clients’ changing needs.

Contact our SME team

If you’d like to discuss the requirements of your SME clients, get in touch. Contact Ian McNevin, SME & Apartments Portfolio Manager on 01 299 5212 or email

Source: BOI Economic Research Unit