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Kerala Launches Insurance Cover for MSME Sector

In Business
October 13, 2023

In a big support to the state’s robust MSME sector, Kerala Government today launched a comprehensive insurance scheme covering the entire spectrum of Micro Small and Medium Enterprises, protecting them from various risks and boosting their confidence to flourish in a competitive business ecosystem.

The Department of Industries and Commerce today entered into Memoranda of Understanding (MoU) with four public sector insurance companies in this regard in the presence of Minister for Industries, Law and Coir P Rajeeve at a function here.

Under the scheme, 50 per cent of the annual premium will be reimbursed to the MSMEs. The Minister also launched a web portal of the scheme http://msmeinsurance.industry.kerala.gov.in/ on the occasion.

“This is an upfront initiative that will provide financial protection to MSMEs against all kinds of risks that can have a detrimental impact on their businesses. It is vitally important to safeguard enterprises with a proper insurance cover as that will create a conducive environment for them to flourish, compete and expand the market for their products and services,” Rajeeve said inaugurating the scheme.

“Kerala now has over three lakh MSMEs, out of which around 1,40,000 have registered as part of the government’s Year of Enterprises initiative itself. However, just about 15,000 of them have insurance cover against various kinds of risks they may confront on their path”, the Minister said.

The Government has been making effective interventions to strengthen the MSMEs by meeting their genuine demands and extending all required supports through various schemes. Still, there are entrepreneurs who are not aware of such programmes and a conclave will be convened to tell them about the schemes from which they could benefit substantially, he added.

Suman Billa, Principal Secretary, Industries and NORKA, who presided over the function, said the insurance scheme will further strengthen the industrial and investment ecosystem of the state. The scheme will also help boost the confidence of entrepreneurs, he added.

Director of the Department of Industries and Commerce, S Harikishore, said the insurance scheme will help MSMEs to quickly recover from unforeseen risks they might run into. The DIC has been drawing up policies based on a thorough understanding of each domain by closely monitoring the scenario, he said.

The insurance companies with which the government entered into agreement are National Insurance Company Ltd, United Insurance Company Ltd, Oriental Insurance Company Ltd and New India Assurance Company Ltd.

The risks covered by the scheme include natural disasters, fire accidents, theft, accidents and market fluctuations, which can leave the MSMEs vulnerable to significant financial loss.

All MSMEs in the manufacturing, service and trade sector having UDYAM registration in Kerala and having enrolled in the “Bharat Sookshma/Laghu Udyam scheme” from any of the four public sector insurance firms for the period beyond April 1, 2023 are eligible for benefit under the scheme.

Enterprises are eligible for reimbursement of 50 per cent of their annual premium with a ceiling of Rs 2500.

MSMEs can purchase the insurance policy by paying the full annual premium, after which they should submit the application for reimbursement to the DIC concerned through the online portal, with supporting documents.It will be implemented through the District Industries Centres (DICs).The DICs will process the applications and reimburse the eligible assistance to the bank accounts of MSMEs.

Additional Director DIC, Rajeev, KINFRA MD Santhosh Koshy Thomas, KSSIA president A Nizaruddin, Dy GM of Oriental Insurance Company Ltd Jaya R Dharmapalan, United India Insurance Company Ltd Dy GM Jenny P John, National Insurance Company Ltd Dy GM Mini George and New Indian Assurance Company Ltd Regional Manager Pradeep Mathew were present.