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Analysis of the Role of Insurance Companies in Driving Growth of SMEs

Article · July 2021

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N.s Lissy
PSG College of Arts and Science
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Impact of Unorganized Sector in Indian Economy View project

Marketing Strategies of Home based Women Entrepreneurs in Coimbatore District View project

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 Analysis of the Role of Insurance Companies in Driving Growth of SMEs

Objective:
To understand the relationship between SMEs and insurance companies. The project also aims to
understand how insurance companies contribute to the growth of SMEs. This involves studying
factors that are responsible for growth and failure alike. One major aspect that this project covers
is the reason that SMEs do not get their businesses insured.

This project highlights what SMEs are and how l insurance companies can prevent them from
being shut down. SMEs are small and medium scale enterprises with about 5 to 10 employees in
a small SME and a maximum of 50 to 100 employees in a medium-scale enterprise.

SMEs are vital for the growth of the economy as they are independent and can generate effective
revenue, contributing to the country’s GDP. It is recommended that these SMEs must get
business insurance. However, with the lack of awareness of insurance of businesses, most small
to medium enterprises fail to function beyond two years.

The lack of sustenance due to a blend of financial difficulties and departmental challenges is the
cause of the shutdown. Therefore, insurance can step this up. If the employees feel secure, they
will be motivated to work irrespective of the un-segregated organizational structure of the SMEs.
The resolution for running SMEs for the long term is insurance.

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