Hailed as a catastrophe by the Insurance Council of Australia, the insurance bill for the Sydney hailstorms has now reached $1.27 billion. However this will certainly not be the last extreme weather event in Australia. As the Bureau of Meteorology has warned these extreme events are rapidly increasing, so we urge small to medium businesses (SMEs) to better protect their business ahead of these events. We’ve outlined what business owners can learn from the aftermath of these events and how you can better protect your business moving forward.
It may sound like an obvious place to start but most businesses don’t have an extreme weather plan in place. Whilst no one could predict the severity of the Sydney hailstorm, many business were left with damaged assets, without power and even employees unable to get to work. It’s important to have a business continuity plan which should include everything from how you’ll contact employees to ensure they come to work safely, or contact customers to let them know the situation.
It’s important to remember that these events don’t distinguish between commercial property and businesses. In fact, business are more affected as they they risk losing income and productivity if there is severe damage to the premises and assets, and if staff are unable to come to work.
While you may have purchased cover for your assets it’s important to understand that if you haven’t followed the procedures to protect your assets you may not be able to make a claim after an extreme weather incident. Focus on mitigating losses – such as parking your fleet in a garage at night – to make sure your claims are not affected.
It’s not just the physical assets that also need protecting – there also other assets to consider such as company and customer data. Any small or medium business should be backing up data to help protect critical business data from disaster. If you handle large amounts of data, and especially customer data, you should be considering storing your data in a server offsite allowing you remote access should your local server be damaged.
For businesses needing to claim after the event, it’s important to mitigate losses as soon as possible to prevent any further damage. Business owners need to carefully record the extent of the damage and detail how you have secured the business property and assets to protect against any further damage. This also helps to protect against any a reduction in awarded claim money because the loss has not been adequately mitigated against.
Many SMEs think they are fully insured because they have insured the physical assets of their company. Business owners often need to purchase a range of insurance to properly protect their business such as property, cyber, fleet and business interruption insurance. Worryingly 80% of SMEs do not have business interruption insurance but yet it is the third most critical risk to Australian SMEs.
Standard insurance often isn’t adequate for a small business owner and an ‘off’ the shelf product can often leave an business uninsured in cases of extreme weather. A broker partner can help assess your business needs to create a specialised insurance package to ensure that you can claim after an extreme weather event. Speak to your Peter Vickers insurance broker for us to be able to understand your business needs and how we can support your business growth without any unpredictable interruptions.
Did you know that 60% of SMEs fell subject to a cyber attack last year. To understand more about cyber insurance cover for your business you can learn more here: “The top 5 reasons SMEs should be considering cyber insurance”.
If you’d like more information on the insurance policies that could protect your business in an extreme weather event please contact one of our broking experts using the button below.
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