The business community in Brunei will benefit if takaful (Islamic insurance) or general insurance subscription is made mandatory
on their business or assets, said Chairman of the Brunei Insurance and Takaful Association (BITA) yesterday.
“It would be good if the requirement for takaful or insurance be made compulsory although this depends very much on the relevant authorities,” said Hj Osman Hj Jair, who is also Managing Director of Insurans Islam TAIB General Takaful Sdn Bhd.
Currently, business owners are not required to insure their shops or other business properties, he told The Brunei Times on the sidelines of an event held to celebrate the Insurance and Takaful Day in the capital.
“Insurance can lessen the burden of the insured in the event of mishaps to their properties. Insurance is actually a form of social benefit.
”He added: “Of course, we do not want accident or mishaps to happen, but the best option is for people to take up insurance or takaful to get themselves covered.”
Hj Osman said it is important for SMEs to know how they could protect their businesses.
“They need to purchase the right takaful or insurance policies in accordance to their nature of business operation so that in the event of any unfortunate incidents e.g. fire, their business operation are protected.”
Businesses may also purchase a business interruption policy to protect their business income, he added.
A business interruption policy provides coverage on loss of income of profit.
One example is when a business is affected by a fire which happened on the top floor of a shop building that they are operating in.
“Though not directly, for example, because of fire extinguisher triggered by smoke alarm, forcing a particular business to shut down and lose potential customers therefore resulting in loss of income or profit to the business owner,” he elaborated.
This is where a business interruption insurance coverage becomes essential, said Hj Osman.
“Of course, they have to evaluate whether they have the means to pay. But paying something for your own protection is the minimum thing you can do in case of big losses,” he said.
“You contribute something small in order to protect your big assets.”
Hj Osman believes that some SMEs are already aware on the importance of takaful and insurance but the take up is low, he said.
Brunei’s low insurance penetration can be deduced by the premiums contributions to the country’s Gross Domestic Products (GDP) which currently stands at 0.9 per cent for non-life and 0.55 per cent for non life as of 2013, said Hj Osman.
BITA at the event yesterday launched a booklet which provides information on matters related The Brunei Times
Source: The Brunei Times
By: FITRI SHAHMINAN