Small businesses hit by crime wave
Filed under: Scams & Fraud
The study of small business owners and sole traders, of which there are more than four and a half million in the UK, also revealed that the average insurance claim resulting from a business-crime was £2,500.
Crime doesn't pay the billsVehicle break ins and thefts from the workplace were the most frequent crimes reported by small businesses, with more than one in 20 (7%) companies falling victim to each.
Many business owners reported that in addition to being targeted by criminals, their businesses were also coming under pressure from fraudulent non-payment of bills. One in eight (13%) of companies interviewed reported this in the survey, making it a bigger threat than any single crime.
Around 360,000 crimes or one third of the total crimes against business resulted in the company having to make an insurance claim amounting on average to £2,500, making the bill to insurers approximately £833 million.
This would be split across trade credit insurers and business insurers, encompassing the likes of employer's liability insurance, commercial property and commercial vehicle insurance products.
Alarm bells ringingJazz Gakhal, head of Direct Line for Business said: "It's alarming to see that as much as a quarter of small businesses have recently been affected by crime, though unfortunately this is always likely to increase in an economic downturn.
The research demonstrates the importance of sufficient protection of the business as claims typically average £2,500, and an unexpected bill of this size could put huge pressure on many small business owners. Businesses should explore the variety of insurance options available to ensure they have appropriate cover for all sectors of operations."
Most frequent crimes for small business owners and sole traders
- Non-settlement of bills 13%
- Vehicle thefts/ break ins 10.5%
- Work equipment stolen from site premises or home 9.5%
- Internet fraud 4%
- Property damage 3%
- Damage to tools 2%
- Assault 1%
- Items stolen from person 1%
- Other 3%
The research by DL4B looked at small businesses employing fewer than five people with an average annual turnover of around £124,000.
- Beware car criminals targeting Brits on holiday
- ID theft hits all-time high
- The scam that makes you feel special