Why Insurance Should Be A Priority For Organizations

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By General Manager – Marketing and Customer Experience – CIC Group

The World Economic Forum forecasts that global growth will slow from 6.0 percent in 2021 to 3.2 percent in 2022 and 2.7 percent in 2023.

In the past few months, the cost of living has gone up, leading to inflated budget requirements in many organizations. These costs have also been felt at an individual level, leading to reduced spending margins for a substantial number of employees. With this in mind, as more organizations seek to become more employee centric, it is crucial that they put up systems to shield employees from negative experiences such as financial losses or risks.

One way organizations can do this is by providing insurance solutions to employees across all business levels. While the law mandates some insurance policies such as a medical cover, organizations are equipped to choose insurance solutions that aligned to the organization’s culture and financial strength.

At the organizational level, businesses need to set up risk management tools that protect them from operational and financial threats. This was very pronounced during the Covid-19 pandemic where business resilience was tested on many fronts. Businesses that were not well protected became more vulnerable to economic shocks, with some facing huge negative financial repercussions. Insurance can provide coverage for some of these unforeseen events, protecting the organization as well as its employees from financial loss. For instance, as more companies shift to emerging technologies and digital operations, cyber insurance solutions can protect the business from loss that would emerge from cyber threats including hacking. In addition, professional indemnity insurance would protect the business from legal risk, allowing for business continuity. In manufacturing businesses for instance, property insurance would provide a good risk mitigation strategy by minimizing the financial loss that the organization would incur in case of theft or fire.

Insurance is also key for employee safety and assurance. Policies such as personal accident or workman compensation protect an employee’s life in case of an accident at the workplace. By providing these policies, organizations not only demonstrate that they value their employees but also help cushion the employee incase an unforeseen threat occurs. This not only boosts employee productivity but can also help with boosting employee morale. Consequently, these policies provide indicators to suppliers and customers that the organization is well informed and prepared for uncertain events that may affect the financial and operational state of the organization. In many cases, insurance policies encourage suppliers and potential business partners to pursue business relationships with an organization.

Further, as more people are encouraged to accumulate savings during their working years, organizations can help by providing education on life insurance options as well as participate in providing this for their employees. With a long term maturity date, options such as education policies, investment policies, and pensions encourage long term savings, which further improves one’s financial stability.

Insurance is necessary both at an organizational and individual level. Drawing many benefits, organizations can help drive uptake of insurance by making it easier for employees to access insurance products. Be it through a customized package or an individual based insurance package, organizations have a role to play in driving insurance penetration in the country.

By leveraging on their strength and capacity, organizations have the opportunity to protect their employees from financial risk or loss both in the short and long term through insurance. As such, insurance should be included as a key component of employee wellbeing and risk management strategies.  

The writer is the General Manager – Marketing and Customer Experience – CIC Group

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