Neobank Chqbook Launches Shop Insurance Cover.Check Details

The insurance aims to cover losses incurred by shop owners due to floods, earthquakes, lightning, storms, cyclones, fire, and other climate risks and any loss due to burglary of contents in the shop

Small businesses in India account for 30 per cent of the GDP and often lack access to financial services, including insurance. ( Image Source :Getty )

With an aim to help small business owners, neobank Chqbook has launched ‘shop insurance cover’ for its digital current account customers in association with ICICI Lombard.

Small business owners including kiranas, chemists, and others can open a digital current account instantly on the Chqbook app in a language they are comfortable with. The current account is available in eight languages. Chqbook plans to onboard more than 500,000 shop owners and merchants in the next 12 months.

What is on offer?

Under this insurance, losses incurred by shop owners due to floods, earthquakes, lightning, storms, cyclones, fire, and other climate risks and any loss due to burglary of contents in the shop will be covered, reported publication Mint.

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India is already grappling with the devastating impacts of climate change and stands to lose 5.21 per cent of its GDP by 2050, according to the G20 climate risk atlas report. Small businesses in India account for 30 per cent of the GDP and often face difficulties in accessing financial services, including insurance. The lack of access and low awareness leave them vulnerable to climatic risks and other man-made risks, forcing them to either take loans or use their savings to cover the losses- potentially pushing them into poverty.

In a recent survey, the neobank found that only 1 in 5 small business owners have insured their shops and contents, despite the potential risks. More than 50 per cent of shop owners feel they are not at risk. This has led to financial struggles for many, with 80 per cent forced to use their savings, sell their valuables or take out loans to recover losses.

"Our partnership with ICICI Lombard General Insurance aims to address this issue and make our community more resilient and financially secure. By bundling shop insurance solutions with our Digital Current Account, we are enabling small business owners to access financial services on their smartphones with no paperwork, empowering them to run and grow their business with the protection they need," Mohit Goel, co-founder, Chqbook told the publication. 

Goel said looking at this massive under-penetration and the need to safeguard this community from unforeseen losses through inclement climatic activities, Chqbook will bear the first-year premium towards this Shop Insurance.

Sandeep Goradia, chief - corporate solutions of ICICI Lombard said the bundling of such a solution will contribute towards increased preparedness and responsiveness of small/micro business owners vis a vis unpredictability during their operations. "This will further enable insurance penetration and adoption of micro insurance products in India," he added.