Forty percent of businesses do not reopen after a disaster and another 25 percent fail within one year, according to the Federal Emergency Management Agency (FEMA). But by taking measures to prepare, businesses can increase their chance of getting back on their feet financially and keeping their doors open. The Insurance Information Institute (I.I.I.) recommends the following steps:
Develop a Business Continuity Plan
A Business Continuity Plan can serve as a crucial tool in helping a company prepare for and survive major catastrophes. When developing a Business Continuity Plan, share the plan with employees, assign responsibilities and offer training so your workforce can collaborate in the recovery of the business. Conduct regular drills to assess and improve response.
Maintain Key Information Offsite
To get your business up and operating after a disaster, you’ll need to be able to access critical business information. In addition to backing up computer data, keep an offsite list of your insurance policies, banking information and phone numbers of employees, key customers, vendors and suppliers, your insurance professional and others. If you have a back-up site make sure it’s sufficiently far away so as not to be affected by the same risks that threaten the primary location.
Take a Business Inventory
Creating a business inventory includes listing all business equipment, supplies and merchandise—and don’t forget to include commercial vehicles.
Review Your Insurance Coverage
The time to review your insurance policy is before disaster strikes and you have to file a claim. It is important that your business have both the right amount and type of insurance for its needs and risk profile. Consult with your insurance professional to see which coverages are right for your business.