Business Disaster Planning

By and | May 6, 2013

Each year businesses and individuals are impacted by disasters. However, a disaster does not have to be widespread to paralyze an agency. Every business (including your clients) should have a Disaster Preparation and Recovery Plan. The better the plan, the better the chance the business will quickly recover.

Unfortunately, many businesses are not prepared in the face of a disaster. Besides creating their own disaster plan, insurance agents and brokers that educate their clients in this matter will gain the competitive edge.

The survival of a business depends upon having a written customized plan with documented procedures developed and reviewed with all of the staff. Part of the plan needs to include regular scheduled tasks and drills. Finally, the business needs to have the proper insurance. When the plan is complete it should have:

  • Employee and catastrophe team duties and responsibilities;
  • Emergency response and operation procedures;
  • List of suppliers and vendors for backup equipment, repair services, insurance companies and organizations to be contacted;
  • Maps of alternate routes to office, emergency office or rally point and offsite storage location.

There are a lot of things to consider when developing a plan.

First, what are assets and resources that the agency must have to continue to function? Human resources are on the top of the list.

Second, is the information that is collected, stored in various media?

Third in the list is the actual equipment, furniture and facilities.

Next, a general assessment must be made of the most likely disaster scenarios. Situations such as floods, earthquakes, fires and storms are what usually come to mind. We are now faced with terrorist attacks, power outages and computer viruses. A disaster could also be the sudden death of key employees.

The impact on the agency’s resources and assets by each of the probable disaster scenarios must be analyzed. A flood or a fire can destroy equipment and information assets, but less likely causes the loss of employees. An earthquake or storm can impact employees, equipment, facilities and possibly the information assets.

Problems such as blackouts and computer viruses have relatively high probability and should have the most comprehensive plan. An earthquake or a fire is a lower probable risk and the problems they create are highly variable. Plans for these disasters need to be flexible and should contain less detail.

There are various sources that a business owner can tap to develop an effective disaster plan. A good place to start is with government organizations such as the website Ready.gov. There are also many private firms that offer advice and support. Some of the insurance associations have planning guides as well. Keep in mind that assisting clients with their own disaster plan (after the agency completes its own) will give the firm a “value added service” it can advertise.

Even if a formal written plan is not drafted, each business owner should still take the time to review and think about disaster preparation and recovery. For the typical agency a disaster plan often starts with one main thing — backing up data. Next, determine how the staff, clients and carriers can contact the agency after the disaster.

It is also important that management discuss with the employees what they should do during major disasters such as storms and earthquakes.

Management should also consider keeping a list of backup or temporary employees that could be available to help handle the workload during a large local disaster.

Finally, the business must have the proper insurance in place.

Agency owners spend much of their lives building up their business; it only makes sense to spend some time developing a plan to recover from a possible disaster.

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Insurance Journal Magazine May 6, 2013
May 6, 2013
Insurance Journal Magazine

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