Abhishek Bondia on SME Insurance [FAQs]

We are a start-up with 10 employees. Can the company purchase health insurance for its employees? Is this better than purchasing health insurance individually?

Abhishek – You should purchase a group health plan for employees. This is an excellent employee benefit and a retention tool because it provides features that an employee would not be able to get on their own. Unlike an individual plan, under Group Insurance all the benefits can be customized. Some of the exclusive features include maternity benefits and pre-existing

diseases from day 1. Also, it is invariably 20-30% cheaper compared to individual insurance.

I have made an angel investment of Rs 1 crore in a digital media company? What insurances does the company need?

Abhishek – The founding members of a start-up are one of its key assets. Hence as an investor, first and foremost, you need to secure yourself for the eventuality of the death of the founder. To address this, Insurance companies offer a scheme called Keyman insurance. Under this scheme, if the founder dies then the sum assured is paid to the company. Thus securing your investment. This insurance is cheap – if the start-up founder is 30 years old then keyman insurance for 10 years and Rs 1 crore sum assured will cost only Rs 10,000 or so per year.

Insurance definitely worth considering! You should also ensure that electronic equipments are covered for breakdown, theft and fire.

We have a small office of 1500 sq ft with 5 computers, phones and a printer? Should we insure these?

Abhishek – You should insure all your assets for and fire and earthquake. Additionally, for electronic equipments like laptop you should take an All Risk cover. Apart from Fire and Earthquake, it also covers for burglary, theft, accidental breakdown etc. Contrary to popular perception, cost of Insurance is a fraction of the risk exposure. Fire and Earthquake insurance for office would cost less than 0.1% of the cost of the assets. An all risk policy for laptops costs less than 1% of the value of the asset. Depending on the sum assured, one is able to negotiate discounts with the Insurer.