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Top 4 risks faced by Malaysian SMEs

rick face by sme

Prolonged lockdowns and extended Movement Control Orders (MCOs) over the past two years have put SMEs through immense strain.

As you focus on rebuilding your business impacted by the pandemic, it is critical not to overlook the everyday threats that can jeopardize the recovery and your business operations in general.

Here are some of the top risks facing companies in Malaysia. While they affect businesses of all sizes, the impact on SMEs can be far more severe, have longer-lasting consequences, or even lead to permanent closure.



Fire risks are among the most significant risks for Malaysian SMEs and there is a wide range of them that owners need to keep their eyes on:

  • Hot work such as brazing, cutting, grinding, welding, and torching can ignite combustible material (e.g., wood, plastic and textile products) with disastrous results.
  • Ignitable liquids commonly found in many industrial facilities (such as fuels, solvents, thinners, cleaners, adhesives, paints, waxes, and polishes) are often flammable or combustible.
  • Intentional fires (also known as arson) are often costlier than accidental fires. Arsonists may deliberately impair fire alarms and sprinkler systems at a vacant premise or accelerate the fire with flammable liquids or other agents.
  • Bush or lalang fires due to dry weather and lightning strikes are natural causes that can start a fire or explosion at your facility.


Whether it’s caused by flammable materials, arson or Mother Nature, fire can clearly pose a costly and dangerous threat given its ability to severely damage premises, destroy expensive equipment, and devastate your business.



Flood is a relatively common disaster in Malaysia. It can happen anywhere - even in areas that are not flood-prone (e.g., flash flooding caused by sudden storms and significant rainfall during monsoon seasons).

Should your commercial premise be caught in a flood, it can have huge material and financial consequences, including business interruption, property damage, inventory loss, the need for debris removal and extensive cleanup.


Water Damage

The same is true for non-weather-related water disasters. Any business can suffer from significant water damage. Some of the common sources include:

  • damaged pipes and hoses, and other plumbing leaks
  • defective or improperly installed fittings
  • failing industrial heating systems


Slip and fall

Slip-and-fall claims are the most common loss suffered by our SME clients, especially those engaged in high-traffic businesses like F&B, retail and shopping malls. Many factors can contribute to a slip-and-fall accident:

  • irregular steps or objects left on the staircases
  • improper or broken handrails
  • slippery floors
  • poor lighting
  • cracks on walkways


These everyday risks (and many others, including burglary and theft) threaten the sustainability and existence of your business. It is important to proactively protect against them before they hurt the business you built through your hard work. Find out more about the steps you can take to help reduce and transfer the risks.


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The benefit(s) payable under eligible certificate/policy/product is(are) protected by PIDM up to limits. Please refer to PIDM’s TIPS brochure or contact Chubb Insurance Malaysia Berhad or PIDM (visit


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