Is Your Small Business Protected against Floods and other disasters?

Content provided by a guest contributor.

The unusually heavy rainfall of the first two weeks in March 2014, have broken records in certain parts of South Africa. According to media house News24, Gauteng, Limpopo, Mpumalanga and parts of North-West, the Free State and KwaZulu-Natal have experienced a 200% increase in rain from what can usually be expected for this time of the year. These conditions have led to widespread disaster. It’s been reported that floods have swept away cars and a number of people have unfortunately lost family members and friends.

The flooding has also done damage to the economy. Many companies suffered losses due to the power cuts that were actioned as part of Eskom’s disaster management strategy. Telkom, as reported in a Mail & Guardian article, is struggling too, both with faults as a result of the floods and subsequent necessary repairs. Many businesses have already started to submit claims for damage to buildings and other property.

This state of affairs should raise an important question in the minds of all business owners – “Is my business properly protected against flood damage?”

Your plan of action

Disasters like floods might be the exception as opposed to the rule in South Africa, but that does not mean that they should be forgotten or disregarded when the time comes to insure a business. Every business owner should always take all factors, scenarios, challenges and opportunities into consideration when setting up a business or, alternatively, at the start of a new year.

The first step in ensuring that your business can withstand a flood should it happen, is to conduct a risk assessment. During this assessment you will identify what could possibly go wrong, determine the effect this type of disaster will have on your business, and decide on actions that should be taken to minimise the risk identified.

Once the risks have been identified, evaluated and addressed, it is time to shop for business and asset insurance. If, for any reason, you do not have business and asset insurance yet, it is vital that you get to this step as soon as possible. Insurance is not only crucial during floods and other natural disasters, but it will also safeguard your company against theft and accidental damage. Should you have acquired business assets by means of asset finance, you might already have insurance as part of the agreement.

For flood damage specifically you want to insure buildings, vehicles and physical assets, like computers, cash registers and machinery. Don’t forget to insure that your data is secure in case of floods as well. You should back up all work, either to a remote server or online on a cloud system like Google Drive, and keep copies of physical documents in a remote location as well. If you’re dealing with huge amounts of data on a daily basis, identify which sets of data and information is most valuable to the business and focus your efforts on those.

Equally important is to have a contingency plan in place should you be unable to operate from your premises for an extended period of time. For instance, could you operate your business from home should the need arise? Do all your employees have access to laptops and cell phones? If they do, they could possibly work remotely for a few days. How will you let customers know about the situation and how will customers get hold of you during this time? Take time to plan the basics as well, like planning routes for an emergency evacuation and having a first-aid kit available.

Taking these steps should ensure that your business is prepared in the case of flooding or other natural disasters. One other thing you can do is keep a cool head at the time. As the business owner, employees will look up to you for guidance. If you handle the situation in a calm manner, so will your staff and this in itself will go a long way in limiting disruptions and damages.

This article was brought to you by Wesbank, a leading provider of business asset finance and insurance.

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