Businesses are vulnerable to economic disasters, labor challenges and product costs.
But they are also vulnerable to hurricanes and other natural disasters, including closures or disruptions that may last for days or longer. Some businesses never reopen after a natural disaster and others may reopen but fail within one year of the disaster.
Virginians are reminded that advanced planning is critical.
“How you plan for and respond to disasters can determine whether your business survives,” Virginia Insurance Commissioner Scott A. White sad. “Protect yourself and your business financially by preparing for the unexpected and having the insurance coverage you need when you need it.”
No business is immune to natural disasters. Even disasters far away can impact your business by disrupting supply chains and communications. Small businesses are particularly vulnerable when it comes to disasters because they have fewer resources, locations and employees to overcome challenges.
The State Corporation Commission’s (SCC) Bureau of Insurance (Bureau) encourages businesses to review their insurance coverage regularly and adjust it, as needed, while considering the possibility of a natural disaster. Businesses should understand what their policies cover and how much they may need to make repairs, minimize disruptions, and pay business expenses, including payroll and payments to creditors in the event of a disaster.
The Bureau offers the following tips to help get your business running again as quickly as possible after a natural disaster:
- Assess your risk for certain types of disasters, such as fires or floods.
- Have emergency disaster and business continuity plans in place.
- Make sure your insurance coverage is up to-date by reviewing policies and making adjustments, as needed.
- Know how to respond if disaster strikes.
Educate yourself on what your insurance policies cover and consider the following:
- What are your deductibles, coverage limits and exclusions?
- Do you need additional or separate coverages such as coverage for damage related to floods or earthquakes, which are not usually covered by standard business insurance policies?
- Do you need separate automobile insurance for business vehicles?
- Are your business and its contents insured for current replacement cost?
- Will you need business interruption insurance to cover loss of income that your business may suffer after a disaster?
Additional steps businesses can take:
- Share business continuity plans with employees that include current employee contact information, backup vendors or suppliers and a temporary relocation site.
- Develop a communication plan and procedures for work processes and payroll during a disaster or business interruption.
- Keep preparedness items onsite at your workplace – including disaster provisions, maps with evacuation routes and access to a working radio and mobile apps for emergency instructions.
- Compile and safely store an inventory of assets and equipment (including computer hardware), and back up all personal and company data regularly in case information is lost during a disaster.
- Keep physical copies of important records (such as building plans, insurance policies, bank accounts and employee contact information) in a safe, waterproof and fireproof place.
- After a disaster strikes your business, contact your insurance agent or company immediately and ask what information is needed to file a claim.
The Bureau of Insurance offers free consumer guides specifically geared to businesses. To learn more, contact the Consumer Services Section of the Bureau of Insurance Property and Casualty Division toll-free at 1-877-310-6560 or in Richmond at 804-371-9185 or visit scc.virginia.gov/pages/Insurance.
Additional emergency preparedness information is available online.