Awareness and access to insurance information by Small and Medium-Sized Enterprises (SMEs) in Kampala

Abstract

Insurance information is crucial for the small and medium-sized enterprises (SMEs) to make the right insurance choices. The current research focused on the awareness and accessibility of insurance information among SMEs in Kampala. This research aimed to determine; the extent of insurance information literacy and comprehension among SMEs in Kampala, the sources of insurance information used by SMEs in Kampala, the factors influencing awareness and access to insurance information among SMEs in Kampala, and the recommendation on how the awareness and access to insurance information among SMEs in Kampala could be enhanced. This was a mixed-methods cross-sectional study that targeted 67 patients. Census sampling was used. The study noted that most of the SMEs had some awareness of insurance but their knowledge was limited. They mainly sourced products that were more mundane and had little idea on how insurance helps to reduce certain risks in their lines of businesses. The selection of insurance was done through brokers and agents which could have been as a result of a lack of understanding of the insurance language used. Moreover, many did not comprehend their current policies. Industry insiders and the media continued to dominate sources of insurance information for SMEs, while online resources began to crop up more often. Shortage of technological competence and digital illiteracy also hampered the flow of information online. Some of the limitations that were observed with regards to access and knowledge included; Technical terms, perceived high costs, and poor trust on insurance firms. Lack of adequate financial understanding made matters worse by limiting decision making on the basis of available information. The study proposed ways of enhancing awareness and understanding including; conducting relevant awareness creation sessions, using customer success stories, ensuring insurance element is included in the financial literacy sessions and the use of multiple media methods. In its findings, the study revealed that SMEs in Kampala are not well informed about insurance services constraining their ability to manage risks and make sound decisions. While enhancing information acquisition and utilization, the work should center on delivering targeted and credible information and using a range of media.

Keywords: Access to insurance information, Small and Medium-Sized Enterprises (SMEs)