Insurance covers mitigate business risks: Gargash CEO

Insurance is predominantly an inexpensive way to recover losses arising from incidents or occurrences that lead to claims, including additional compensation for legal expenses and any other associated costs.

Running a business, big or small, is rife with challenges and a certain amount of risk. Although some pitfalls and challenges cannot be avoided, they can be mitigated by instilling proper precautions, planning, and of course, adequate insurance coverage. Choosing right and appropriate insurance solutions, however, is the key, said Kenneth Maw, CEO, Gargash Insurance Services LLC.

"In a competitive market like the UAE, with more than 60 insurance companies, businesses sometimes take a myopic view and settle for policies that are no more than a tick in the box. It could pose greater challenges in times of need. Choosing a professional broker who understands the needs of a business is, therefore, more than just useful."

At Gargash Insurance, Maw says, qualified brokers regularly visit clients and understand business needs before advising on what policy covers should be considered. This exercise is important because business owners, in some cases, are not fully aware of the policies available that can mitigate certain business risks. "We look at a host of different insurances before briefing the client to make sure that we advise them about everything that they're exposed to. As insurance brokers, we take pride in building strong relationships with our clients and gaining their trust for a long term partnership. It’s very important that when we visit clients, we fully understand their needs, identify gaps in the policies, if any, and also suggest alternative or additional coverage that may not have been procured, which should be considered."

Gargash Insurance play on their strength of being a one-stop-shop for all kinds of insurance for businesses. "Instead of having to go to several different insurance companies and maybe buying through multiple providers, we can consolidate everything and become insurance advocates for businesses. We source and procure the requisite insurance from different providers and supply businesses with all the solutions they need," notes Maw, adding: "There are some businesses that require specialty knowledge and here at Gargash, we pride ourselves in having executives who have both extensive knowledge of what the market can offer, but also years of invaluable experience supporting almost every type of conceivable business. As such, we are more than capable of affording our clients with a first class service when it comes to managing their insurance requirements."

Talking about challenges for businesses, Maw sees rising medical inflation as a possible cause of concern. "The biggest concern (in business) at the moment is medical inflation. Medical insurance is a heavily utilised product and constitutes more than 50 per cent of the whole insurance market in terms of written premium. If costs of medicine and healthcare continue to rise,it could put severe pressure on employers, businesses, as well as insurance companies. There could be a point when the employers might not be able to afford health insurance for their employees at the same terms that they enjoy today."

Average premiums on individual medical policies in the UAE have risen considerably in the last one year. While premium rates on group insurance schemes have remained largely similar due to fierce competition, some companies have opted for higher deductibles this year or sought other methods to mitigate excess policy usage.

Maw has been in the insurance industry for more than four decades and witnessed simpler times in the 80s when the UAE insurance industry had a handful of brokers and insurance firms. The industry wasn’t as price sensitive as it is now. "The market has matured. Today, we have over 60 insurance companies and more than 150 insurance brokers competing in the same space. We didn't have these aggressive price wars in the 80s; those times were simple. Today, brokers aggressively compete on this front, which might seem a good strategy for customer acquisition, but in real essence, it is not. Price points are not a barometer of good customer service or overall experience," notes Maw.

Relentless focus on customer service has allowed the brokers to earn a reputable name in business. "Much of our business comes to us through networking and business referrals. In the case of retail clients, a significant number of enquiries are now pouring in through digital channels. We believe this is poised to grow even more so in the next few years and as such, we will need to ensure we also keep on top of technological developments within our industry," said Maw.

Gargash Insurance has been in business for three decades. It has become a market leader in offering insurance to the small and medium enterprises and is now actively looking to tap big-ticket customers and expand its presence in the industry.