2019 Small Business
Risk Report
2019 Small Business Risk Report
This executive summary presents the key findings of the 2019 Small Business Risk Report, a joint effort by Forbes Insights and The Hanover Insurance Group, Inc. This study surveyed U.S. small business owners who had experienced a business insurance claim in the last five years, focusing on the value they place on insurance, claims and risk management.
Key findings
Small business owners' claims experiences greatly influence their level of confidence in their insurance programs, the types of services they value and their view of their vulnerability to claims in the future.
Small business owners satisfied with their claims experience are more confident in their insurance programs.
A majority of small business owners believe they will face a claim in the next five years.
Small business owners find risk management services valuable, but are not consistently aware of them.
Small business owners satisfied with their claims experience are more confident in their insurance programs
64%
of small business owners were satisfied with their most recent claims experience. The study found claims satisfaction impacted small business owners' overall confidence in their insurance programs.
Claims satisfaction overview
Overall 80% of small business owners report they are confident they are adequately insured. Those who are satisfied or highly satisfied with their claims experiences are much more confident they have adequate insurance protection in comparison to those who were unsatisfied or very unsatisfied with their claims experience.
94%
of highly satisfied claimants report they are confident in their insurance program.
58%
of unsatisfied claimants report they are confident in their insurance program.
This indicates that claims experiences have has a notable impact on small business owners' perspectives of their insurance programs.
Of those who report they were unsatisfied or very unsatisfied, quick processing and response times were most important to them, suggesting that small business owners are expecting more from their claims experience beyond coverage.
Small business owners rank the following aspects of their claims experience as most likely to drive satisfaction:
Solutions for small business owners
Helping small business owners understand the claims process before a claim arises can help them be prepared when faced with a claim. This includes:
- How to report a claim
- Information needed based on the type and severity of claim
- Resources to support their business during the claims process
Learn more about The Hanover’s claims capabilities to support your small business customers.
A majority of small business owners believe they will face a claim in the next five years
52%
of small business owners believe they are likely to face a claim in the next five years.
The study found small business owners' views of the next five years closely mirrors their previous experiences. The top three claims concerns small business owners report that they expect to face in the next five years are property damage, employee injury and auto accidents. The following graph details the types of claims small business owners most expect to face over the next five years:
Solutions for small business owners
Small business owners report that they are vulnerable to a wide range of possible claims. Completing an annual insurance review can help ensure the right level of protection from both standard and specialty coverages.
Share The Hanover’s small business insurance checklist to help educate small business owners about the different types of insurance solutions available for their business.
Cyber risks remain an area of growing concern for small businesses
In recent years, data breaches and cyber security incidents have created a lot of buzz in the news, bringing more attention to this area of risk for small business owners.
18%
of small business owners report facing a data breach incident in the past five years.
63% of small business owners who faced a cyber or data breach claim expect to face another claim in the next five years.
In addition, 67% of small business owners agree that as they make their business more digital, they are more vulnerable to cyber security incidents.
Although many small business owners may not have faced a data breach-related claim, their increased digitization is a growing area of concern.
Solutions for small business owners
Cyber represents a complex area of risk for small businesses, and a growing need for advice from an insurance agent to help navigate risks and protect their businesses.
Learn more about The Hanover's cyber coverage and risk management solutions.
Small business owners find risk management services valuable, but are not consistently aware of them
All small business owners reported that they see value in risk management services for their businesses.
64%
of small business owners report their local agent discussed risk management services with them.
69% of small business owners report that multiple types of risk management services would be valuable to their businesses. Here is the breakdown of the risk management services that small business owners identified as most valuable:
The most valued services closely align with the types of claims small business owners were most concerned about.
| SBOS TOP CLAIMS CONCERNS | SBOS MOST VALUED RISK MANAGEMENT SERVICES | % OF SBOS WHO SELECTED VALUABLE SERVICE |
|---|---|---|
| Employee Injury | Employee safety training | 72% |
| Theft | Equipment theft prevention and recovery | 65% |
| Data breach or cyber security incident | Data breach preparation and remediation services | 72% |
| Employment practices related (EOC actions such as wrongful termination, discrimination, sexual harassment) | Employee background checks | 67% |
| Property damage | Equipment theft prevention and recovery | 56% |
A more comprehensive understanding of their insurance coverage, combined with risk management services, will provide the most benefit to small business owners.
Benefits of a comprehensive understanding of insurance
Assurance that my business is protected in all areas
More confidence that I will be able to keep my business up and running
Makes it easier to shop and compare coverage, based on more than just price
Insurance adds to my company's credibility
Solutions for small business owners
Approximately one-third of small businesses reported they are not offered risk management services or were not aware of them. This represents a great opportunity for independent agents to educate small business customers about available services.
The Hanover offers a wide-range of risk management services and resources for small businesses—many are available free or discounted.
About this report
About The Hanover
The Hanover is a leading property and casualty insurance company offering a broad portfolio of tailored coverage solutions for personal, commercial and specialty customers. The Hanover is a Fortune 1000® company, with nationally recognized claims service and proactive risk management expertise. The company's financial strength has earned it high marks from key industry analysts, including an "A" rating (Excellent) by A.M. Best Company.
About Forbes Insights
Forbes Insights is the strategic research and thought leadership practice of Forbes, a global media leader that champions success by celebrating those who have made it, and those who aspire to make it. By leveraging proprietary databases of senior-level executives in the Forbes community, Forbes Insights conducts research on a wide range of topics to position brands as thought leaders and drive stakeholder engagement. Research findings are delivered through a variety of digital, print and live executions, and amplified across Forbes' social and media platforms.
Press contacts
Emily P. Trevallion
etrevallion@hanover.com
508-855-3263
Abby M. Clark
abclark@hanover.com
508-855-3549
Survey methodology
Forbes Insights surveyed U.S. small business owners throughout the country. In the survey, small business owners were asked about their past claims experience, how they view their future claims vulnerabilities and the value of risk management services to their business as they consider the risks of today's evolving and challenging business environment. The 14-question survey was conducted by email, and was fielded January 7, 2019, through February 1, 2019. The Hanover was not identified as a participant or sponsor of the survey.
Read our 2018 Small Business Risk Report
2019 Small Business Risk Report
This executive summary presents the key findings of the 2019 Small Business Risk Report, a joint effort by Forbes Insights and The Hanover Insurance Group, Inc. This study surveyed U.S. small business owners who had experienced a business insurance claim in the last five years, focusing on the value they place on insurance, claims and risk management.
Key findings
Small business owners' claims experiences greatly influence their level of confidence in their insurance programs, the types of services they value and their view of their vulnerability to claims in the future.
Small business owners satisfied with their claims experience are more confident in their insurance programs.
A majority of small business owners believe they will face a claim in the next five years.
Small business owners find risk management services valuable, but are not consistently aware of them.
Small business owners satisfied with their claims experience are more confident in their insurance programs
64%
of small business owners were satisfied with their most recent claims experience. The study found claims satisfaction impacted small business owners' overall confidence in their insurance programs.
Claims satisfaction overview
Overall 80% of small business owners report they are confident they are adequately insured. Those who are satisfied or highly satisfied with their claims experiences are much more confident they have adequate insurance protection in comparison to those who were unsatisfied or very unsatisfied with their claims experience.
94%
of highly satisfied claimants report they are confident in their insurance program.
58%
of unsatisfied claimants report they are confident in their insurance program.
This indicates that claims experiences have has a notable impact on small business owners' perspectives of their insurance programs.
Of those who report they were unsatisfied or very unsatisfied, quick processing and response times were most important to them, suggesting that small business owners are expecting more from their claims experience beyond coverage.
Small business owners rank the following aspects of their claims experience as most likely to drive satisfaction:
Solutions for small business owners
Helping small business owners understand the claims process before a claim arises can help them be prepared when faced with a claim. This includes:
- How to report a claim
- Information needed based on the type and severity of claim
- Resources to support their business during the claims process
Learn more about The Hanover’s claims capabilities to support your small business customers.
A majority of small business owners believe they will face a claim in the next five years
52%
of small business owners believe they are likely to face a claim in the next five years.
The study found small business owners' views of the next five years closely mirrors their previous experiences. The top three claims concerns small business owners report that they expect to face in the next five years are property damage, employee injury and auto accidents. The following graph details the types of claims small business owners most expect to face over the next five years:
Solutions for small business owners
Small business owners report that they are vulnerable to a wide range of possible claims. Completing an annual insurance review can help ensure the right level of protection from both standard and specialty coverages.
Share The Hanover’s small business insurance checklist to help educate small business owners about the different types of insurance solutions available for their business.
Cyber risks remain an area of growing concern for small businesses
In recent years, data breaches and cyber security incidents have created a lot of buzz in the news, bringing more attention to this area of risk for small business owners.
18%
of small business owners report facing a data breach incident in the past five years.
63% of small business owners who faced a cyber or data breach claim expect to face another claim in the next five years.
In addition, 67% of small business owners agree that as they make their business more digital, they are more vulnerable to cyber security incidents.
Although many small business owners may not have faced a data breach-related claim, their increased digitization is a growing area of concern.
Solutions for small business owners
Cyber represents a complex area of risk for small businesses, and a growing need for advice from an insurance agent to help navigate risks and protect their businesses.
Learn more about The Hanover's cyber coverage and risk management solutions.
Small business owners find risk management services valuable, but are not consistently aware of them
All small business owners reported that they see value in risk management services for their businesses.
64%
of small business owners report their local agent discussed risk management services with them.
69% of small business owners report that multiple types of risk management services would be valuable to their businesses. Here is the breakdown of the risk management services that small business owners identified as most valuable:
The most valued services closely align with the types of claims small business owners were most concerned about.
| SBOS TOP CLAIMS CONCERNS | SBOS MOST VALUED RISK MANAGEMENT SERVICES | % OF SBOS WHO SELECTED VALUABLE SERVICE |
|---|---|---|
| Employee Injury | Employee safety training | 72% |
| Theft | Equipment theft prevention and recovery | 65% |
| Data breach or cyber security incident | Data breach preparation and remediation services | 72% |
| Employment practices related (EOC actions such as wrongful termination, discrimination, sexual harassment) | Employee background checks | 67% |
| Property damage | Equipment theft prevention and recovery | 56% |
A more comprehensive understanding of their insurance coverage, combined with risk management services, will provide the most benefit to small business owners.
Benefits of a comprehensive understanding of insurance
Assurance that my business is protected in all areas
More confidence that I will be able to keep my business up and running
Makes it easier to shop and compare coverage, based on more than just price
Insurance adds to my company's credibility
Solutions for small business owners
Approximately one-third of small businesses reported they are not offered risk management services or were not aware of them. This represents a great opportunity for independent agents to educate small business customers about available services.
The Hanover offers a wide-range of risk management services and resources for small businesses—many are available free or discounted.
About this report
About The Hanover
The Hanover is a leading property and casualty insurance company offering a broad portfolio of tailored coverage solutions for personal, commercial and specialty customers. The Hanover is a Fortune 1000® company, with nationally recognized claims service and proactive risk management expertise. The company's financial strength has earned it high marks from key industry analysts, including an "A" rating (Excellent) by A.M. Best Company.
About Forbes Insights
Forbes Insights is the strategic research and thought leadership practice of Forbes, a global media leader that champions success by celebrating those who have made it, and those who aspire to make it. By leveraging proprietary databases of senior-level executives in the Forbes community, Forbes Insights conducts research on a wide range of topics to position brands as thought leaders and drive stakeholder engagement. Research findings are delivered through a variety of digital, print and live executions, and amplified across Forbes' social and media platforms.
Press contacts
Emily P. Trevallion
etrevallion@hanover.com
508-855-3263
Abby M. Clark
abclark@hanover.com
508-855-3549
Survey methodology
Forbes Insights surveyed U.S. small business owners throughout the country. In the survey, small business owners were asked about their past claims experience, how they view their future claims vulnerabilities and the value of risk management services to their business as they consider the risks of today's evolving and challenging business environment. The 14-question survey was conducted by email, and was fielded January 7, 2019, through February 1, 2019. The Hanover was not identified as a participant or sponsor of the survey.
Read our 2018 Small Business Risk Report