ET Make in India SME Regional Summits: This insurer is the safety net every MSME needs

Time of India

09-07-2025

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The ET Make in India SME Regional Summits reached their fourth destination this year in Thane, on June 26. As India's leading forum for engaging with the nation's MSMEs at the local level, the Summits create connections between businesses, facilitators, major industry players, and government officials, resulting in focused networking that addresses the specific needs of different industrial regions.Under the banner 'Thane means business: Manufacturing excellence, entrepreneurial drive', this edition highlighted one of India's most advantageously-located industrial hubs. Located near Mumbai, Thane has easy access to the infrastructure and financial services essential for MSME development and trade competitiveness. The region hosts a diverse industrial ecosystem, chiefly enterprises engaged in chemical, pharmaceutical, and engineering.But there are drawbacks too. Thane is vulnerable to unforeseen events such as incessant rainfall and floods. And unlike larger corporations, pharma and chemical MSMEs lack the resources to maintain extensive backup systems, leaving them exposed when natural disasters or other emergencies disrupt their carefully-calibrated operations.Anjali Mirchandani, Deputy General Manager of NIA, spoke about what her company is doing to safeguard enterprises against such risks. Here are the highlights from her fireside chat at the ET Make in India SME Regional Summit - Thane, titled 'Empowering MSMEs through comprehensive insurance: Bridging the protection gap with New India Assurance'.When you're running on razor-thin margins (and most MSMEs do), natural disasters aren't just business risks. They're existential threats.The 2005 Mumbai floods, for example, tested the resolve of every business in the Mumbai Metropolitan Region. And for NIA, it was a moment that defined its approach to MSME insurance. As Mirchandani said: 'Floods are not new to Mumbai. They are not new to Thane. They are not new to the Dombivli and Bhiwandi belt. And we are not new to floods.'She added that NIA has the best settlement ratios in this context, which is critical for business continuity. Its expertise in handling catastrophic claims has made its insurance products, including for fire, one of the most sought-after ones, particularly among MSMEs that rely on bank financing.Apart from flood and fire insurance, NIA also covers specialised cover for workmen's compensation, machinery breakdowns, and marine insurance for transportation."You can customise things the way you want. You can choose one or two products or have a number of them in one policy for seamless cover," Mirchandani explained. 'It's insurance that adapts to your business, not the other way around.'Here's something most small manufacturers in Thane's chemical belt don't know: you might already be breaking the law. The Public Liability Industrial Act of 1991 was updated in December 2024, and the implications are staggering. If you're manufacturing, trading, storing, or transporting certain chemicals, you're now legally required to have specific insurance coverage.The limits? They've jumped from Rs 5-15 crore to Rs 150-500 crore, linked to paid-up capital. Non-compliance can result in fines or business shutdown. "Many of you may not be aware, but it is compulsory," Mirchandani emphasises. "It's now a statutory obligation to take this insurance policy."The push is not about compliance, but survival. In the event of a chemical leak, when third-party property gets damaged or when lives are affected, this insurance is the difference between staying in business and closing down forever.Despite digital-everything, NIA is aware that the most important person in the MSME insurance ecosystem is still "that good old agent around the corner'. That acquaintance who's been handling insurance for years, someone who's the one-point contact for everything from policy purchase to claims service."This is the most preferred mode. Despite so much digitisation, this continues to be the most preferred form of communication even today," Anjali Mirchandani observed.It's a reminder that in the world of small business, relationships still matter more than technology. MSMEs want someone they can call when things go wrong, someone who understands their business and can guide them through the complexity of insurance claims.As environmental regulations tighten and Environmental, Social, and Governance (ESG) norms become mandatory, NIA is already preparing for the next wave of MSME insurance needs. Pollution liability insurance, which is currently not a priority for most small businesses, is likely to become essential as environmental responsibility becomes non-negotiable."The environment is becoming a fundamental issue in this country. Any and every one of us has to be responsive to the fact that if we are causing any damage to the environment, we need to be held responsible for it," Mirchandani said.All in all, NIA isn't just selling insurance; it's selling the ability to sleep at night. Whether it's protecting against floods and fires, ensuring compliance with new chemical industry regulations, or providing comprehensive coverage that doesn't break the bank, the insurer has positioned itself as an institution that understands what small businesses need.