Can Your Business Survive a Disaster?

This year's hurricane season promises to be one of the most active in history and potentially more costly than the four hurricanes that pummeled Florida in 2004 and caused $17.5 billion in damage. And hurricanes are not the only potential hazards that businesses may face. Fires, floods, computer malfunctions, power surges, and acts of terrorism can all have severe impacts on businesses of all sizes and types.

While business interruption insurance can help companies survive the financial impacts of a disaster, it cannot retrieve lost data or train staff how to respond. Therefore, it is critical for all businesses to have a recovery plan tailored to its specific needs before disaster strikes. Here are some items for inclusion:

• Appoint someone to be in charge and a second in command.
• Assign responsibilities to staff members
• Prioritize recovery activities
• Back up all important data and store offsite in a safe place
• Protect critical paper records (insurance and financial information; customer, supplier, and personnel records)
• Keep copies of all important forms, including extra checks, offsite
• Keep a copy of your disaster plan at home, including contact information for employees and service people whom you use (e.g., electricians, plumbers, computer consultants)

In a disaster, loss of property can be detrimental, but insurance can help you replace property. Loss of vital data and the lack of a plan to resume operations with as little disruption as possible can be completely devastating to a business.