Not Having Right Insurance Can Be A Disaster For Small Businesses
Many small business owners in the Northeast are still trying to recover from floods caused by as much as 8 inches of rain earlier this month.
Those who had flood insurance can recoup some of their losses, but those who never purchased such coverage are now dealing with the fact that a disaster doesn’t have to be a hurricane, tornado or earthquake to cause cataclysmic damage to a company.
Insurance industry analysts and people who advise small businesses say many companies find themselves underinsured when disasters happen. Many don’t have the specialized policies that would cover disasters, or they have coverage that falls short in dollar terms of what they need. Or they find they didn’t read the fine print about what was and wasn’t covered when they bought insurance.
Cost is a factor when owners decide not to purchase specialized disaster insurance; the premiums and deductibles tend to be high because damage tends to be heavy and insurance company payouts in turn are large. Small business owners without a lot of spare cash often decide to take their chances and hope disaster never strikes.
But insurance shouldn’t be the only consideration when a small business thinks about reducing the losses suffered in a disaster — companies need to think about ways of mitigating the damage by planning well in advance for how they get themselves up and running after a catastrophe.
Such planning includes knowing where and how you’ll get your company up and running again, where you’ll get supplies from a vendor, how you’ll get in touch with clients and customers.
Photo by MSDesign.
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