For much of America, Labor Day Weekend means a last hurrah for summer, the start of the school year, and the beginning of football season. As the first weekend in September, though, it also marks the beginning of National Preparedness Month, a 30-day effort sponsored by the Federal Emergency Management Agency (FEMA).
Naturally, insureon is happy to spread the word about what small businesses can do to celebrate a month of preparedness – as insurance nerds, being prepared is pretty much our favorite thing. (You should see how excited everyone gets around here during a fire drill.)
Here’s an overview of how you can use the resources and information sponsored by National Preparedness Month to strengthen your business so it can survive whatever unexpected events come its way. (For tips on managing the risks from your employees, read "How to Manage Risks from Wildcard Employees.")
5 Steps to Prepare Your Small Business for a Disaster
FEMA’s business-preparedness website suggests business owners take a five-step approach to prepping for the various disasters that threaten them:
- Program management: This phase requires that you, as the business owner, commit time and resources to developing a disaster preparedness plan. It may sound basic, but you know how busy you are: unless you make preparedness a priority, you’ll never get around to doing it.
- Planning: This phase can be morbidly fun as you think of all the things that could go wrong: natural disasters, technology failures, disease epidemics, zombie invasions, etc. In the world of insurance, this is known as identifying your risks and figuring out what you can do to minimize them.
- Implementation: Here’s where you take action by developing an emergency plan, training your employees, implementing practices that reduce your exposure to various threats, and purchasing insurance to protect yourself financially wherever possible.
- Testing / Exercises: Fire drill time! (But seriously: testing and exercises should address a broad range of potential threats and should involve debriefing to identify what works and what needs improvement, should you face a real emergency.)
- Program Improvement: This phase acknowledges that disaster preparedness is an ongoing activity, not something a business owner can do once and forget about.
Risks You Can Manage with Business Insurance
The bad news about business insurance is that it can’t protect your business from all the risks you face. Certain natural disasters and acts of terrorism, for example, are typically excluded from Property Insurance policies. But there are policies available to shield you against the losses from…
- Certain storms. Non-named storms, wind storms, and many winter storms can wreak havoc on small businesses. Property Insurance can help you not only repair your premises and replace damaged items, but also maintain revenue if a storm prevents you from opening your doors. Ask your agent about Business Interruption Insurance, which is a Property endorsement that distributes benefits to replace business income in the event of a property damage-related closure.
- Technology failures. Whether caused by a power surge or something less obvious, a failure in your computer system could spell disaster, especially if it causes you to lose essential client data. Property Insurance policies can pay for the replacement of fried technology equipment, and a Cyber Liability policy can help fund the expenses you face if a technology failure leads to a data breach that exposes your customers’ information.
- Lawsuits. A contamination outbreak that affects food you serve in your restaurant or sell at your grocery store could trigger a lawsuit from sickened customers. Without insurance, this type of disaster could spell financial ruin for many small businesses. With General Liability Insurance in place, however, you’ll have the funds necessary to pay for your defense and any judgments or settlements you’re found liable for.