Insurance Association of Sri Lanka makes compelling case to opt for general insurance

Insurance Association of Sri Lanka Secretary Tanuj Edward (left) and President Chandana L. Aluthgama 

In our dynamic lives, we encounter various opportunities to safeguard what matters most to us, including our health, homes, and businesses. While challenges may arise, we have the power to proactively protect our properties from potential risks like fire, flood, or theft. By investing in comprehensive insurance coverage, we not only ensure the well-being of our assets but also gain peace of mind in the face of uncertainties.

 Additional covers for marine and aviation insurance when transporting goods is compulsory to guard against any losses. In today’s world, general insurance for businesses has become imperative. General insurance has grown in demand in the light of the inflation and high cost of living which makes any sudden financial loss difficult to bear, not to mention the mental and emotional trauma that follows. 

Seeking medical help in a foreign country without being insured can be a challenge as medical costs in some countries are prohibitive. Health insurance when travelling offers protection in case of illness or accident that requires hospitalisation in the country or overseas.

However, while general insurance may be more prevalent in the world of business and commerce, it is yet to take root in a more comprehensive way in households and for personal covers. Sri Lanka had 5.1million households by 2021 but very few houses were insured. 

In most instances, the insurance for homes is taken only when there is a mortgage from the bank and at the end of the loan period if insuring the property is not continued. Households can assess their homes and insure any valuable items they own so that in case of a burglary, fire, or water damage, they can receive compensation from the insurance company. Most commercial properties are amply covered currently, but corporates have downsized insurance requirements while incurring losses due to various natural perils and other omissions. 

Further commenting on insurance awareness and affordability, Insurance Association of Sri Lanka (IASL) Secretary Tanuj Edward said: “We as an industry should explore avenues to increase the penetration of General Insurance amongst the public. SME’s and individuals should be educated of the benefits of insurance and how it would assist them in the unlikely event of a loss which could affect their businesses and livelihoods. There is a big void in SMEs opting for insurance requirements to mitigate their losses due to natural perils or other causes because of preconceived notions that insurance is costly. If stocks not covered by insurance, it could hinder operations leading to greater financial losses. Also taking into consideration the reduction in disposable income, the industry should strive to find a suitable middle ground by introducing simple and affordable policies.” 

Moreover, corporates and SMEs both have neglected their own employees who contribute to the company operations as they are not being provided with Medical Insurance. Companies take care to insure a motorcycle but have failed to provide a personal accident cover or a workers compensation insurance to their employees of which the costs are negligible. Further, Liability Insurance is not considered by most corporate and SME business whether they are service oriented or manufacturing based operations as they may have not experienced the losses that may incur in the future. 

“The Insurance Association of Sri Lanka urges the public to reflect on the role of insurance and to prioritise the quality of insurance coverage. Today, buying insurance online is a paperless, easy, and quick process, which means there are no excuses to stop every Sri Lankan from protecting themselves,” said Insurance Association of Sri Lanka (IASL) President Chandana L. Aluthgama.