About 20% of SMEs in New Zealand are considering increasing their business interruption (BI) cover, compared with 10% who are thinking about a decrease in cover.

The figures come from a survey by Vero New Zealand of more than 600 policyholders. The insurer says the findings will help it work with brokers and advisers to offer a compelling proposition to SMEs.

It also recommends that business owners should consider seeking expert advice on any plans to reduce cover or cancel it entirely.

“Cancelling a policy might cut some costs in the short term, but it can come back to bite you,” EGM Customer Experience Mark Wilkshire said. “Having insurance is vital in building a financially resilient business.”

More than 66% of the SMEs surveyed reported a revenue hit due to the COVID-19 pandemic, making business owners twice as likely to be impacted by financial vulnerability compared to householders.

Nearly 40% of business owners say their household is also struggling to make ends meet, compared to 21% pre-COVID.

The findings come ahead of the full 2020 Vero SME Insurance Index for New Zealand, which is to be released next month.