Although the COVID-19 pandemic continued to impact small business owners’ revenue in the first half of 2022, data from Zensurance’s inaugural Canadian Small Business Confidence Index survey finds a majority of business owners and self-employed professionals feel good about their prospects.
According to the survey, 46% of respondents say their revenue was either down or about the same in the first six months of 2022 compared to the first half of 2021. However, 60% say they are confident their businesses will be successful over the latter half of this year.
When asked how much of an impact the pandemic has had on their businesses or professions since the start of 2022, 36% say it had a moderately negative impact, 21% say it significantly impacted them, and 31% claim it had little or no impact whatsoever. However, for a few, the pandemic has given their businesses a boost. Almost 7% say it had a moderately positive impact and nearly 4% say it had a significantly positive effect.
Although most respondents to the Zensurance survey are upbeat about their prospects, slightly more than 52% admitted their businesses could not afford to take on more debt to fund necessary projects or initiatives. Meanwhile, 29% say they can afford to take on more debt in 2022, and nearly 18% say they’re not sure.
What’s Spooking Small Business Owners Currently
Survey respondents were also asked what issues or concerns they have as they look ahead to the second half of the year.
Not surprisingly, the effect of inflation is the greatest concern for most (51%). The spiking cost of gasoline also ranks high (16%), as does managing cash flow (13%). Almost 6% cite the cost of business insurance, 5% worry about supply chain reliability, and 2% say the ability to get insurance is a factor. Another 9% say none of the above.
Where Business Insurance Ranks Among Small Business Owners
The survey then queried respondents for their views on business insurance.
For starters, respondents were asked if they have a business insurance policy and how often they compare rates. Interestingly, almost 40% say they shop around for insurance annually, 13% do so once every few years, and 7% say they never do. Another 40% say they don’t have a business insurance policy.
For those small business owners who do not have business insurance, we asked why. The majority (25%) say they don’t think they need it. Others say they don’t because it costs too much (16%) or because they have personal home and auto insurance (16%). Another 13% admit they haven’t thought about it.
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Among those who have a policy and what influenced them to get one to protect themselves from the cost of accidents and third-party liability risks, most (15%) say it is a legal or regulatory requirement for their profession or industry. Another 13% cite an insurance broker’s influence, 13% say they were encouraged by family, friends, or colleagues, and 8% did so because of advice from a mentor. Advertisements influenced 3%, and stories in the media motivated 2% to get a policy.
3 Must-Know Facts About Business Insurance
Business insurance protects Canadian business owners, entrepreneurs, contractors, and self-employed professionals against common risks by shielding them from the financial costs of a disaster, accident, or injury. Here are three primary reasons why you need it:
1. Home and auto insurance isn’t enough
The personal insurance coverage you have for your home or condo and vehicle is not designed to cover you for accidents and incidents related to business activities. Even if you have a home-based business, your residential coverage may not be sufficient for your risks.
2. The cost of a lawsuit or accident far exceeds the price of a policy
Among our survey respondents who don’t have a business insurance policy, 16% say it’s because it costs too much. The cost of policies can fluctuate year-over-year. The price of coverage can be influenced by the economy, inflation, fraud, and a jump in the number of claims filed. However, the premium you pay for a policy costs significantly less than what it would cost to defend yourself in a lawsuit or if your commercial property was destroyed by a fire, for example.
3. Not all insurance providers charge the same amount
Insurance providers compete with one another to get your business. They aim to keep their prices as low as possible to beat their competitors. Therefore, it’s worthwhile to shop around annually before purchasing a policy for the first time or renewing an existing policy.
On that note, Zensurance has over 50 insurance providers in our partner network. That’s why it’s always worthwhile to get a free quote by filling out an online application, and let our licensed brokers shop your rate to get you the right amount of coverage at the best price.
About the Zensurance Small Business Confidence Index
The Zensurance Small Business Confidence Index is an online survey of 222 Canadian small business owners and self-employed professionals conducted by a third-party provider throughout June 2022.
Among the survey’s respondents, 11% say they work in construction and professional trades, 10% in retail and e-commerce, and 9% in health and wellness. Another 9% are in the technology industry, 6% in hospitality and tourism, 6% in finance, 5% in manufacturing, 3% in engineering, and 1% in sports and fitness. Additionally, almost 40% listed their industry or profession as “other”.
By region, most respondents are in Ontario (49%), 18% in Alberta, and 16% in B.C. Five per cent call Saskatchewan home, followed by Nova Scotia (4%), Manitoba (3%), New Brunswick (2%), and P.E.I. and Newfoundland and Labrador (1% respectively).
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