MSMEs: the power of small business

SMEs generate a large share of new jobs in OECD economies, and even more so in the EU, where they account for about 99% of all enterprises. They create about 85% of new jobs and provide two-thirds of total private sector employment. For many rural areas, they are almost the only source of employment. The possibilities they generate, both economic and employment-wise, can be the answer to the social needs of many people and become a pillar for inclusion.

Since 2017, we have celebrated the World Micro, Small and Medium Enterprises Day every June 27th. This event, which is promoted by the United Nations (UN), is intended to recognize the importance and the role these companies play in boosting economies. Their main role, as noted, is to promote development and employment. In addition, they contribute to the Sustainable Development Goals, notably the following: Goal 8 (Decent work and economic growth) and Goal 9 (Industry, innovation and infrastructure).

The COVID-19 crisis has shown us that the pandemic has not affected us all in the same way. In the private sector, micro, small and medium-sized enterprises (MSMEs) have been the most affected, which is why today we are talking about the importance of insurance for these types of companies.

To talk about MAPFRE’s contribution to this type of companies we had Ramón Pujol, Territorial Sales Manager for Catalonia and the Balearic Islands, to tell us MAPFRE’s vision and how important insurance is for MSMEs.

We began by asking him how MAPFRE advises these companies. Ramón responded by highlighting a key aspect for them: personalized advice.

“You have to be prepared to provide this kind of advice. You have to know the business world and master the full spectrum of protection needs that can be covered by insurance.”

He further added: In this area, it is essential to provide advice with a 360º vision to be able to assess the different types of risks to which the business may be exposed. MAPFRE stands out for having highly qualified personnel for this task and with specific tools that supplement this work of assessment and advice so that the customer understands it perfectly without having to make use of technical terms.

It is very important for small businesses to be able to focus on developing their business with peace of mind. That is why we asked Ramón about the type of support MAPFRE offers to these companies so that they can feel calm and secure.

Ramón pointed out that accompaniment is essential. The situation of a business in its phase of conception and birth is changeable and it is essential for insurance, in a broad sense, to reflect or take into account such change. The emergence of new risks is inherent to the development of the business, so it is necessary for them to feel that they are accompanied at all times. 

“In this context the work of the professional mediator carrying out permanent advisory work is key. MAPFRE has the largest professional network of insurance and financial services advisors and its role is crucial here.”

Finally, we wanted to talk about the needs that such companies can cover thanks to insurance, and although the needs are very diverse, as Ramón rightly said, in his experience we can group them into a few categories:

First of all, the most tangible, property needs, those that have mainly to do with risks associated with damage to one’s own property. Here we would find, for example, typical fire coverage.

Secondly, the liability risks and that have to do with damages that the company may cause to third parties in the course of its business. For example, third party liability as a consequence of damage caused by a product manufactured or sold by the company.

Thirdly, we have another group of financial risks, which cover losses of an economic nature. In this case, credit insurance covering the company’s bad debts.

Fourthly, and increasingly important, the need for coverage of risks associated with the workforce and, in particular, those related to corporate social protection, such as life or health insurance for employees, among many other solutions.

Finally, Ramón wanted to emphasize the importance of insurance with respect to all the new risks that are appearing in our modern society:

“The evolution of society and technology brings with it the emergence of new risks that make it necessary to broaden our view to new risks beyond that categorization. Protection against cyber attacks is a clear case of this reality.”

MAPFRE joins in celebrating the World Micro, Small and Medium Enterprises Day. We stand by their side because they represent a fundamental link in sustainable development.

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