I Will Survive
Earthquakes, fires, floods-disasters happen all the time. Whether man-made or from Mother Nature, unexpected catastrophes are less likely to defeat businesses that have effective disaster-preparedness plans in their back pockets.
While it may seem too early to worry about the worst, protecting your business as soon as you launch it is actually the wisest course of action. An entrepreneur's first step, according to experts, is to ask yourself what you would do if you couldn't occupy your offices. How would you contact employees? How would you reach your clients? What kind of insurance coverage will you need to ensure you can do all these things?
Business-interruption insurance and records reconstruction are good policies to look into, according to experts. Says Gary W. Eberhart, executive vice president of the National Association of Professional Insurance Agents in Alexandria, Virginia, "[Insurance agents] can be your partners-they can help you come up with a plan."
And although disaster insurance coverage can be costly, especially after 9/11, a few efficient, less expensive ways can protect your business, too. Back up all your crucial data and keep those files off-site in a safe place. But be sure to check on them, experts say.
"Periodically retrieve those backups and make sure they are complete," recommends Larry Baye, director of Business Continuity Services at Grant Thornton LLP in New York City.
You should also make copies of important paperwork such as customer contracts, employee information and legal documents, and keep those off-site as well.
Finally, you should do your homework and make sure that each of your outside vendors also has a disaster plan lined up.
According to Baye, "A lot of startups are dependent on outside parties, and they really haven't done much due diligence-they never really inquire whether or not the third party has any [disaster] coverage in place."
Disasters can be nightmares, but, with the right contingency plan, your business can and will survive even the worst of circumstances.
- Grant Thornton LLP
(212) 542-9750, www.grantthornton.com
- National Association of Professional Insurance
(703) 836-9340, www.pianet.com
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