9/20/2017 6:20 PM | 0 Comments

 

As we are reminded all too often by today’s current events, disasters can strike at any time. Most people will worry about the safety of their families and their homes, but as a business owner, you have an additional worry – your business. While your primary business concern is always, “How do I keep my business running, growing, and thriving?” It is extremely important to consider the same question in the context of a massive business interruption. If a fire, hurricane, water main break, terrorist attack, or earthquake struck tomorrow, how would your business run, grow or thrive? For too many people, it won’t. According to FEMA, 40% of businesses never reopen after a disaster.  Of those that do, only 29% were still operating after two years.


How do you become one of the businesses that survive? By planning for it. Here are a few of our tips to help you start to prepare and protect your business against disasters. 


Tips for Preparing Your Business for Natural Disaster and Emergencies


  1. Determine the Risk
    When determining the potential risks for business interruptions, consider both environmental risks (flooding, wind, snow) and human risks (fire, theft, etc.). Talk with your financial advisors, insurance agent, and other business owners to help you identify potential risks based on your industry and location.

  2. Calculate the Cost of Interruptions
    For many business owners, it is tempting to undersell the real costs of a disaster occurring. Use your resources to calculate actual costs for rebuilding, relocating, temporary office space, liability, lost income, and payroll. These numbers will likely sound daunting, but with the proper insurance programs in place, you will feel little financial impact.  

  3. Create and Share a Crisis Communication Plan
    How will you check-in and communicate with your employees in the event of a disaster? What if the crisis occurs when the office is open or closed? How will you be able to communicate closings, hour changes, or re-openings to your clients, quickly and efficiently? What are the different ways that you can communicate these messages, such as phone trees, emails, or text messages? These are just a few of the things to consider when building your communication plan. When drafting your plan of action, make sure to include templates of actual communications so that in the event of an emergency, your messaging can be dispersed quickly and efficiently. And remember to share these plans with your staff.

  4. Prepare an Emergency Plan 
    Develop an emergency evacuation plan for your building and practice it with all of your employees so that everyone can safely exit the building if needed. Be sure to practice these plans on a regular basis— show your staff where to find all fire extinguishers, evacuation alarms, and exits, as well as alternative exits in case certain areas are blocked. One or more managers, usually in Human Resources, can be the main point of contact in an emergency — be sure to share their information with the entire organization.

    Develop a plan for a situation where you may have advanced warning for a potentially disastrous situation. When a major storm is approaching, clearly communicate to employees what is expected of them regarding remote access to business functions. 

    We also recommend setting up an IT and data recovery emergency plan to protect and recover the important information you need to run your business in the event that it has to shut down. 

  5. Get the Right Insurance Coverage 
    After a disaster occurs, you want to be focused on getting your business up and running, not how you are going to be able to afford it. The proper insurance policy package can help provide you with coverage:

    • To repair your damaged building.

    • For-profits that would have been earned based on previous financial records, had the disaster not occurred.

    • For operating expenses, such as utilities, that must be paid even though business operations have temporarily ceased.

    • To continue to pay your employees, who may also be recovering personally from the same disaster.

    • For the expenses of operating in a temporary location while repairs to the permanent location are completed.


Even though nobody likes to think about a disaster occurring, having comprehensive preventive and response plans for natural disasters and emergencies can help increase your business’s odds of survival. Don’t leave your business open to financial disaster. Consult with a member of our experienced Commercial Lines team by reaching out to customerservice@easterninsurance.com or by calling (800) 333-7234. We also invite you to learn more about the services we provide at www.easterninsurance.com.  

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