In order to protect your business from unavoidable interruptions, it’s important to have an effective business continuity plan (BCP) in place. At a glance, your BCP should serve the following purposes:
Review the following guidance for an outline of steps that you can take to develop an effective BCP and minimise business interruptions.
When determining the potential risks for business interruptions, consider both environmental risks and human risks. Additionally, consider which risks are preventable and which are not.
Once the risks are identified, you can begin to understand all elements involved, such as the hazard itself, the assets at risk, vulnerability to the risk and the ultimate impact of the risk. In order to be best prepared, rank each risk according to the likelihood of occurrence and the severity of impact.
After the risks have been ranked, analyse the impact of each risk. In calculating cost containment, the following should be considered:
3. Understand Your Insurance Cover
The next step would be to review your insurance cover. Business interruption insurance generally comes into effect in these circumstances:
Since business interruption cover can differ significantly, it is important to understand the policy terms, such as exclusions, extensions, cover limits and indemnity periods. Be sure to review your policy carefully with a certified insurance broker to ensure bespoke cover for your unique business needs.
4. Implement Steps for Prevention and Mitigation
There are three different approaches for controlling and containing potential hazards:
5. Create a Crisis Communication Protocol
As part of your BCP, it’s important to establish a crisis communication protocol in order to provide employees and customers with updates and critical information. The protocol should include the following:
6. Prepare an Incident Response Plan
In addition to a crisis communication protocol, your BCP should include an incident response plan to ensure your organisation is prepared to respond appropriately and efficiently to a disaster. This plan should be practised and reviewed regularly for effectiveness. Specifically, the plan should include the following elements:
By taking these steps, it is possible to minimise potential business interruption risks and limit the impact of unexpected disasters. Contact our Risk Management Division for further business continuity guidance and to discuss bespoke business interruption insurance solutions.
To find out more about Business Continuity Planning, contact Joe Hanna or Wes Barker on 028 9032 9042 or use the contact form below.