TD Insurance survey shows small businesses, especially non-employer businesses, underestimate the importance of insurance, putting them at greater risk for unexpected costs and liability
TORONTO, Oct. 24, 2023 /CNW/ – 2023 was a tough year for small business owners. Impacted by rising rates, high inflation and challenging economic conditions, solopreneurs – entrepreneurs who are the only employee of their business – are feeling the impact. According to a recent TD Insurance survey conducted by Leger, only 55 per cent expressed confidence in the future of their business, compared to 70 per cent of small business owners with one or more employees.
At the same time, solopreneurs are not taking steps to protect their business as they are least likely among small businesses to have small business insurance with only 33 per cent indicating their business is insured. Comparatively, 61 per cent of small businesses with one or more employees have small business insurance protection.
According to Statistics Canada, 98% of businesses in Canada are small businesses and there are more than three million non-employer businesses across Canada, indicating that there is an abundance of entrepreneurs that are going at it alone in terms of business operations. With the TD Insurance survey indicating this group is putting less priority on insurance protection, there is a growing number of businesses owners putting themselves and their businesses at risk.
“Small businesses contribute significantly to the Canadian economy and have demonstrated incredible resiliency over the past few years. Unfortunately, they are also exposed to a variety of risks for which they need the right insurance protection,” said Tony Menon, Senior Vice President, General Insurance, TD Insurance. “It is important for small business owners, regardless of their size, to protect what they have built and to future-proof their business.”
For small businesses without insurance, four-in-ten (41 per cent) say they don’t need it for their business or industry. When solopreneurs specifically were asked why they lacked business insurance in their plan, 46 per cent indicated they didn’t feel coverage was necessary with them being the only employee.
“Small businesses with and without employees can be vulnerable to a number of events that could lead to financial losses like unexpected business closure, theft, property damage, personal injury and liability,” adds Menon. “With the right insurance coverage, small business owners can feel confident that their business is protected against unexpected costs and liability.
- Small businesses with insurance carry a high level of satisfaction and confidence in their coverage, with more than eight in 10 agreeing their business is protected through their insurance coverage (86 per cent).
- Fifty-nine percent of small business owners believe they have a strong understanding of the types of insurance specific to their businesses. This level of understanding is significantly greater for those who currently have small business insurance coverage (75 percent) compared to business owners without it (41 percent).
- Solopreneurs, compared to those with more than one employee, were more likely to admit that they have a weak understanding of different types of insurance coverage options available (41 per cent) and were less likely to have consulted with a licensed insurance advisor 63 per cent.
- Digital tools were perceived to be useful in assessing insurance needs, with more than half of small business owners (57 percent) stating that they would prefer using an online tool for quotes before speaking with an advisor.
Keeping in mind the digital needs of small business owners, TD Insurance has rolled out a Digital Quoter tool, with easy access to customized quotes and insurance assessments for small business owners to better understand their insurance needs.
To learn more about the different insurance policies available to small business owners, contact a licensed TD Insurance advisor or visit TD Insurance for Business for more information.
The Toronto Dominion Bank and its subsidiaries are collectively known as TD Bank Group (“TD” or the “Bank”). TD is the sixth largest bank in North America by assets and serves over 27.5 million customers in four key businesses operating in a number of locations in financial centres around the globe: Canadian Personal and Commercial Banking, including TD Canada Trust and TD Auto Finance Canada; U.S. Retail, including TD Bank, America’s Most Convenient Bank®, TD Auto Finance U.S., TD Wealth (U.S.), and an investment in The Charles Schwab Corporation; Wealth Management and Insurance, including TD Wealth (Canada), TD Direct Investing, and TD Insurance; and Wholesale Banking, including TD Securities and TD Cowen. TD also ranks among the world’s leading online financial services firms, with more than 16 million active online and mobile customers. TD had $1.9 trillion in assets on July 31, 2023. The Toronto Dominion Bank trades under the symbol “TD” on the Toronto and New York Stock Exchanges.
A survey by Leger was conducted between August 15-20, among 502 Canadian small business owners / decision makers, 18+. No margin of error can be associated with a non-probability sample (i.e. a web panel in this case). For comparative purposes, though, a probability sample of 502 respondents would have a margin of error of ±4.4%, 19 times out of 20.
SOURCE TD Insurance
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