Business interruptions, such as those caused by natural disasters, can be very costly to small businesses that have not prepared adequately for such eventualities. To protect your business from these issues, an insurance broker can assess your operations and suggest the best cover. This article discusses some measures that you can take to prevent a disruption from affecting your business extensively.
Audit Your Books Annually
Insurers are usually interested in quantifying the loss that a business has suffered before deciding how much compensation to provide to the affected business. Having audited books of accounts can expedite the loss assessment process because you will have verifiable records upon which you can base your claim. Businesses that suffer a disruption without having audited books of accounts may take longer to resume normal operations because the loss assessment process can take longer.
Duplicate Your Records
It is also helpful for you to make copies of your business records. Keep those copies away from your business premises, such as in the cloud, so that those records can be accessed in case those in your premises are destroyed during a business disruption (such as a flood). The copies will come in handy when insurance assessors want to determine the extent of the loss that you have suffered due to the disruption of your operations.
Get Secondary Suppliers
Another step that you can take is to have a list of secondary suppliers that you can do business with in case the main suppliers suffer business disruptions. Your operations will not be affected since the secondary suppliers will immediately step in to provide the materials or services that you need to stay functional when the primary suppliers are unable to meet their contractual obligations to you due to a business disruption.
Find Alternative Premises
It is wise to maintain a list of premises that you can acquire at short notice in case your premises are affected by an event, such as a fire, which renders them unusable for your business. Simply work with a real estate agent who knows the kind of premises that you need. They can then give you periodic updates of what is available within your area of interest. You can then select what you need as soon as your premises are unusable.
Business disruptions can lead to the collapse of businesses that aren't prepared adequately. Work with a business insurance broker so that you can be advised about the forms of cover that you need for such a risk. The broker will also suggest the measures that you need to take to keep the insurance cover affordable.
