Insurance Protects Your Businees in a Natural Disaster

A Insurance Article Contributed by Deepak Cutting

Insurance, a Tool to Deal with Disaster;

Insurance against natural disasters is essential to survival of your enterprise. Of all enterprises that have to close down following a disaster, about 25% cannot reopen. It is true that one cannot prevent natural disasters like a flood & hurricane from occurring, one can and must protect their business from natural disasters. A carefully thought out plan must be in place to ensure recovery from the ravages of nature.

*The Plan:

You must consider the possible ill effects of natural disaster on your enterprise and devise ways (including adequate insurance) to handle such situations. Large corporations often hire risk managers for this purpose. Disaster planning and recovery are given due attention in successful business, big and small.

Your disaster management plan must include the following, apart from insurance;

· Your employees must know whom to notify and should be familiar with what they are expected to do when disaster strikes, in order to minimize loss of life and property.

· The disaster management plan should be a written document. The duties of every member of your staff in such a situation must be clearly spelt out. Mock drills will familiarize the employees with their roles in such a situation.

. Prepare a list of people who will be helpful at times when natural disasters strike. Also, list your important customers, suppliers, insurance agents, bankers and other stakeholder who you will like to contact in the aftermath of a disaster, must be ready.

. Put up notices outside your premises. Get in touch with clients over the phone, by mail and email and keep them informed about the date when you expect to reopen for business. Other stakeholder like your suppliers etc. should also be similarly informed.

. Provide for things that will be needed to deal with the effects of a disaster, such as back-up power, alternative communication system etc.

. Consider the protection of human resources (your employees and clients that may be in your premises) and material resources (your plant, building, machinery and stocks etc.), when disaster strikes. Also, protect your records and maintain back-up records.

Review Your Insurance Plan

Whereas the above stated measures will minimize the damage to your business due to natural disasters, the insurance claim is the only way to recover from the damage caused. Insurance cover protects you and provides funds to re-establish the business ravaged by a natural disaster. Be sure that there is sufficient insurance cover to enable you to rebuild your business completely in the event of a natural disaster.

Make sure you understand the limitations and the deductibles of your insurance policy. Damage to your business can go beyond physical damage to plant, building, machinery and stocks etc. This includes loss due to interruption in business, additional costs incurred etc. Your insurance policy should be able to compensate for all losses at the time of disaster.

Protect Your Personal Belongings by Insurance;

While it is necessary that your business interests are covered by insurance and kept protected from natural disasters, it is equally important that your home, car and other personal possessions are also properly insured. Protection of your personal possessions through insurance will do wonders to your morale when disaster strikes. Insurance protection gives you the will to handle all the ill effects of the natural disaster without your getting depressed and thus loosing the will to rebuild your business.