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What is the average cost of insurance for a small business and startup in india?

QuestionsCategory: Group Health InsuranceWhat is the average cost of insurance for a small business and startup in india?
default avatarPlan Cover Staff asked 2 months ago

1 Answers

Best Answer

default avatarSrinivasan Mahadevan Staff answered 2 months ago

Small business insurance costs can vary widely due to a number of variables, including the policy being purchased, your business’s unique requirements and risk profile, and level of coverage etc. Let us examine the average costs by the type of insurance purchased:

1. Group Health Insurance: 

Small business health insurance cost depend on multiple variables including the number of employees and members to be covered, coverage limit, benefits and any cost containment measures opted in the policy. Some insurers also factor location  as well in pricing the policies. Hence it is challenging to say exactly how much your business will pay. But we can work out an estimate figure by averaging what businesses across industries pay group health insurance.
The average annual health insurance premium for small businesses should vary between INR 1,200/- to INR 1,800/- per employee for a coverage limit of INR 100,000/-, and for a 200,000/- sum insured coverage it should vary between INR 1,600/- to INR 2,500/-

2. Directors & Officers Liability Insurance:
In addition to the industry, and the list of coverage, the robustness of the financials is a key criteria for determining the cost for this insurance.

The average cost of this insurance across industries will vary between INR 40,000 – 75,000 per year for a coverage of INR 7.5 crore ( USD1M) which is the most preferred coverage limit for small businesses.

3. Professional Indemnity Insurance:

The key variable for pricing this insurance is the type of business, customers serviced, scope of services delivered and the geographical spread of customers across the world. It is generic that for a small business having more number of customers outside India, especially in markets like the U.S.A. and U.K. the cost of professional indemnity insurance will be higher.

Average cost across all industries will vary between INR 125,000/- to INR 200,000/- per year for a coverage limit of INR 7.5 crore ( USD1M).

4. Commercial General Liability Insurance (CGL): There are events that can happen in a normal business operations that can leave small businesses legally liable for suits made by third-parties. A CGL insurance policy protects small businesses against such financial losses.

The cost of this insurance again is dependent on the type of business, products manufactured and coverage limit. The average cost across industries will vary between INR 50,000 – 150,000 per year for a coverage of INR 7.5 crore ( USD1M) which is the most preferred coverage limit for small businesses.

5. Standard fire insurance :

Fire insurance policies protect for loss or damage to physical assets owned by small businesses. The cost of this insurance will depend on the location, type of business and the asset value that need to be covered.

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