SMEs are leaving themselves open to serious crime risks according to new research from Aon Risk Solutions. The new study suggests the danger of cyber risks are being overlooked by many SMEs. Just 4% said they had insurance cover in place to help protect them from the implications of cyber attacks, very little change from one year ago (3%).

The new research reveals only one in twenty SMEs (5%) say they have cover in place for crisis management situations (including terrorism, ransom and product contamination).

These are among the latest findings from Aon’s nationwide survey of 1,042 decision makers within SMEs. Aon explored which types of insurance, if any, had been taken out by business owners to protect their enterprises from unforeseen risks. The picture that emerged was of many of Britain’s SMEs not recognising the risks posed by not having the right insurance policy in place to cover them against a range of risks – with more than one in five (22%) saying they have no insurance in place at all.

Chris Lee-Smith, MD, Aon Affinity, commented: “The SME sector is currently dealing with change on two fronts. On the one hand, many are preparing to gear their businesses up for growth, with one in two (50%) claiming a positive outlook for the months ahead. Set against this there have been a range of high profile cyber attacks and an increased feeling of insecurity in recent weeks underlining the uncertain world we live in. Cybercrime is a significant risk and security concerns should be top of mind for any business. Our research suggests that whilst general economic confidence in the SME sector is improving, many are over-looking the need to protect their business from very real risks that could derail growth plans.”

With 78% of UK businesses having a variety of insurances in place to protect their business, the gap between small and larger businesses has widened this quarter. SMEs with a turnover of less than £1million are particularly exposed to employee injuries (29% vs. 56%), property damage (24% vs. 48%) and health and safety risks (11 vs. 35%).

Top five business priorities:

· Around two in five (39%) SMEs are covered for being sued for negligence, an increase of 4% on Q2 2015 (35%).
· One in three (33%) small businesses have insurance policies covering them against damage to property, including problems such as natural disasters and arson, an increase of 5% on the 28% in Q2 2015.
· 21% have taken out life insurance policies, a slight increase on the 18% in Q2 2015.
· Almost one in three (29%) businesses are covered against damage to fixed assets, a small increase on Q2 2015 (27%).
· Around two in five businesses (38%) have taken out insurance policies to protect against employee injuries and third party liabilities in the work place (33% in Q2 2015).

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