Insurance as an Optimization Tool for Risk Management in Small and Medium-Sized Enterprises

Abstract

The SME risk management optimization model includes appropriate methods for identification, analysis and classification of risk assessment and developing a plan to overcome the risks and control the applied reaction to risk. Insurance is a classic way of a risk management process and is applicable to specific situations. The subject of this study is exposure and risk management in small and medium-sized enterprises (hereafter: SMEs) which are eligible for transfer of insurance coverage. This paper discusses the process of risk management in SMEs by transfer to insurance and indicates which risks and in what way can be transferred to the insurer. In this paper we analyze the supply of domestic insurers in Serbia, and insurance requirements, variants that offer coverage to overcome the particular risks to which SMEs are exposed. In the elaboration and research of mentioned theses the paper will use methodological procedures of analysis and synthesis, the inductive-deductive method, and if necessary, the comparative method of scientific research.