Fast rising costs for energy and rent are the top two business concerns among UK small to medium enterprises, or SMEs, according to a survey commissioned by specialist insurer Hiscox.

The effect of the economy on their business, dealing with paperwork/regulation, compliance with UK company law, and business continuity problems such as power-cuts, also rated highly in the inaugural Hiscox SME Risk Barometer survey of the top 10 business concerns.

The survey also found that risk management and legal issues are areas of concern. Nearly three in five SMEs (59%) are spending more time looking at risk management issues than they did two years ago, while 70% believe that they are more likely to be subjected to a frivolous legal claim due to the rise of a ‘no-win, no fee’ legal culture.

Theft or vandalism are also a very real worry for SMEs, with nearly one in four having suffered from either or both during the past five years, costing each business an average of GBP2,504. A total of 8% have suffered from fire or flood during the past five years, costing them on average GBP119,200.