Following Best Practices in Risk Management: Some Tips. Article written by Sara Smith
As a business owner, you have the responsibility of following best practices in risk management because it could be the difference between recovery and bankruptcy in the case of an unexpected event.
Whether you are the humble owner of a small bakery or you operate a supermarket franchise, the threats to your security are the same. How would you respond if your business was hacked? Or if one of your drivers were to be found at-fault for a vehicle collision resulting in a death?
Nature also offers its own array of problems; anything from power disruptions due to a severe storm to forest fires can compromise daily business activities.
So what sort of techniques are you using to safeguard your business, the associated property, employees and liabilities? Do you have a business continuity plan?
Preparedness is key, says the Insurance Bureau of Canada, and you can prepare yourself for the worst with two basic tips.
Step 1: Confide in an insurance broker
As you may already know, having an adequate business or commercial insurance policy is the best way to mitigate the effects of business interruption. There are several options in shopping around, such as making calls to insurance companies or surfing the Internet for the best commercial insurance quote.
The most efficient way to proceed, however, is to find an insurance broker who has extensive knowledge of the type of business you do and prepared to find the best plan to meet your needs. The perks of going to a broker or brokerage firm are centered on trust. Insurance brokers work for you; since they do not represent independent insurance companies, there is no conflict of interest.
Not everyone is an insurance expert, but your broker should be a veteran in the industry. They are equipped with know-how that most people outside the sector will not be aware of, so consult a broker and receive professional advice.
NOTE: Snotherly Insurance Agency is recognized as a Trusted Choice Independent Insurance Broker.
Step 2: Determine the amount of coverage you need
Figuring out what to insure and the extent of coverage needed are the next steps. As sagacious as your broker is, you still have a large role to play at this stage because you have an intimate knowledge of your business and know where the risks lay. Make a list, write out your priorities and determine the vulnerabilities that may lead to bankruptcy or other another calamity if left unchecked.
During this step, focus your attention on the types of assets you have, the kinds of threats they could potentially face, any risks specific to your trade and any perils associated with the location of your business. Storing sensitive data on a network? Add cyber protection to your commercial insurance policy. Living in an area prone to ice storms and power outage? Make sure damages and expenses pertaining to that are covered. Situated in a high-crime neighborhood? Add theft, vandalism and arson to your coverage plan.
Running a business is difficult as it is, but with adequate commercial insurance customized for your needs, business interruption will be one less thing to worry about.
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