Small businesses have more difficulty recovering after natural disasters

This blog has previously underlined the importance of business owners taking the time to conduct thorough risk assessments and find comprehensive insurance policies. Smaller companies must take extreme care in this process, as unexpected events can prove to be very costly.

A recent survey from Alibaba, Vendio and Auctiva showed that 74 percent of small business owners have not created a disaster recovery plan, even after Hurricane Sandy and Winter Storm Nemo. Furthermore, the Red Cross reports that as many as 40 percent of small businesses do not reopen after a major natural disaster such as a flood, tornado or earthquake.

Carol Chastang, a spokesperson for the Small Business Administration, told the online news source FOXBusiness that smaller incidents, such as burst pipes or a fire in a neighboring building, are more likely to cause serious damage to a company's financial stability.

"Keep accurate documentation of the furniture, equipment and technology that your business owns," Chastang said. "Take good pictures, make copies and keep them in a secure site, which will help you collect insurance in the case of damage."

With more organizations becoming reliant on technology, Chastang added that it is also crucial to back up all data and files. Original copies can become destroyed in a storm, for example, and it can be more difficult for company heads to prove ownership. In this situation, technology insurance will be beneficial for an organization.

Overall, business owners cannot think, "it will never happen to me" or "something small will not affect my company." They need to dissect daily operations in order to figure out the intricacies that must be accounted for should an unexpected event occur. Commercial insurance specialists can help fine-tune general insurance policies that are able to help a number of different companies.

 

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