THE CONTRIBUTION OF INSURANCE COMPANIES TO THE GROWTH OF SMALL AND MEDIUM SCALE BUSINESSES

ABSTRACT

The contribution of insurance companies to the growth of small and medium scale businesses

The goal of this study was to determine the contribution of insurance companies to the growth of small and medium scale businesses and the relationship between insurance companies’ contributions and the growth of SMEs in NICON, based on the following objectives: examine major factors that affect SMEs’ growth; assess the contribution of insurance companies to SMEs’ growth; investigate the factors inhibiting SME operators’ purchase of insurance cover; and determine the strength of the relationship between insurance companies and SMEs.

The study was descriptive in nature and used quantitative approaches such as surveys to collect data. A total of 65 managers and employees from National Insurance Corporation responded to the survey. A simple random sampling method was performed, in which the researcher went to NICON and handed out questionnaires to the employees.

SPSS and frequency distribution tables were used to analyze the data. The findings demonstrated that innovation is a strong empirical evidence for fast-growing SMEs, that competition has a significant impact on the SMEs industry, and that finance continues to be a significant barrier to SMEs’ growth.

In addition, insurance companies reduce risk and improve SMEs’ loan acceptance with banks. However, SMEs’ limited income, high premium costs and bureaucracy, as well as their experience and views, prevent them from purchasing insurance coverage. Nonetheless, the Spearman Correlation Coefficient shows a strong positive association between insurance businesses and the growth of SMEs.

SME performance is improved by improving business skills, according to the findings. Insurance firms, on the other hand, do not cut insurance costs or provide protection to their customers. Furthermore, due to their small size and inability to properly comprehend the paperwork, SMEs are unable to obtain insurance coverage. It was suggested that NICON’s management develop a strong relationship with SMEs as clients in order to develop and grow trust, as well as cut premium rates for SMEs in order to boost their performance. NICON also has to take a fresh look at the extent and spectrum of services offered to SMEs, as well as a clearer knowledge of the size of the business sector.