A new survey report released by QBE Australia has revealed that micro-SMEs in the country have varied attitudes toward business insurance, shaped by their motivations, time in operation and industry.
The 12-page survey report Adapt, protect and thrive; How micro-SMEs navigate risk and opportunity found that for those with insurance coverage, the benefits are clear—79% report peace of mind, 81% feel protected and 53% are more confident in taking financial risks, enabling innovation and growth without fear of setbacks.
The report reveals that 83% of micro-SMEs (those with less than 10 employees) feel confident in their current level of insurance protection, underscoring its critical role in fostering stability and enabling growth.
Micro-SMEs are considered the backbone of Australia’s economy and continue to demonstrate resilience despite challenges such as rising operational costs, supply chain disruptions, and shifting consumer demands. Yet, financial vulnerabilities remain a concern, with 29% unable to manage a financial setback exceeding AUD10,000 and 23% unable to withstand any financial disruption if they didn’t have insurance.
QBE managing director (consumer) Julie Starley said, “We know based on our claims data that the average payout for a micro-SME for unforeseen damages including to their property and subsequent interruption to their business is well over AUD10,000, a cost that more than half Australian micro-SMEs (52%) would not be able to afford.
“Businesses grow, and so do their risks. Regular policy reviews ensure that coverage is not only up to date but also suitable to the challenges and opportunities faced by micro-SMEs. This allows them to focus on innovation and growth with confidence,” said Ms Starley.
The report highlights how micro-SMEs are actively managing risks through strategies like streamlining expenses (40%), building financial reserves (38%), and diversifying their offerings (25%). Their top aspirations reflect a focus on growth and stability, with 50% aiming to increase profitability, 43% seeking to expand their client base, and 42% prioritising cash flow stability.
Despite their resilience, 59% of micro-SMEs have not updated their insurance since their business inception, leaving them exposed to risks as they scale, hire staff or acquire new assets.
The report also offers practical potential solutions for micro-SMEs to optimise their insurance strategies, such as aligning policies with growth and choosing flexible coverage options. With up to 2 million micro-SMEs playing a vital role in Australia’s economy, robust and adaptive insurance solutions are essential to their resilience and success.