What's Your Business Continuity Plan?

By SME Insurance

Posted 03/07/15

Between managing staff, keeping on top of accounts, purchasing stock, preparing food and then of course the actual frying, it’s understandable why some fish and chip shop owners don’t have time to think about protecting themselves against some disaster that may never even strike.

However, putting time aside to consider a business continuity plan is not only likely to lessen the impact, or in fact stop your business failing, if you do encounter a major disruption such as a flood, power fault or a fire, but it may also enable you to receive a cheaper insurance premium.

Research from the British Insurance Brokers’ Association (BIBA) and the Cabinet Office reveals that 62% of BIBA broker respondents said that those with business continuity plans benefited from premium discounts and reduced excesses. Insurers supported this too, with 83% of those asked, said that they would provide a discount or improved insurance terms to a business interruption policy if a business continuity plan was in place.*1

The survey showed that 74% of all emergencies against businesses were water or fire related, with flood and escape of water at 41% and fire at 33%. Staggeringly the survey revealed that only 5% of small and micro businesses have plans in place, meaning that SMEs appear to be most at risk from the effects of a major disruption.*1

A business continuity plan highlights the necessary arrangements to bring the event under control, with the aim of keeping the business trading. It would also highlight the resources needed to allow the main business functions to continue and any actions required by the staff.  

A disruption to your business may be a costly affair and therefore it is vital to have the correct level of cover in place to ensure your business can continue afterwards. Loss of revenue plus extra expenses often means reduced profits. Many businesses simply don’t have the capacity to continue trading following an incident, and a disaster such as a fire can leave a business unable to re-establish themselves.  

A business continuity plan is an essential part of any company’s response planning and it is important to consider what you would do if unforeseen circumstances left your premises unusable and how you would keep your business running in the interim. Speak to SME Insurance Services about protecting your business and adding business interruption cover to your policy. 

*1 https://www.biba.org.uk/press-releases/business-continuity-plans-reduce-insurance-premiums-and-save-businesses/

Posted 03/07/15

Author: SME Insurance

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