Business Continuity planning
Who needs a business continuity plan?
Any business should consider the risks that it faces, and how it would manage should something go wrong. A good business continuity plan should recognize all of the likely threats to trading that may take place, and detail a strategy that can be implemented before, during and after an event that will affect your businesses ability to trade normally.
What are the benefits of a business continuity plan?
By having clear management strategy in place for a given circumstance, a business should be able to minimize the overall impact of an event. This will include operational issues, as well as reducing financial impact. And because a good piece of continuity planning will consider the likely impact on key stakeholders (suppliers, staff, customers being the most obvious), it should ensure a more positive reaction, by ensuring clear communication and required actions are apparent.
Business Continuity planning and business insurance
A business can buy a specialist insurance policy – a business disruption cover – that is designed to protect the business in the event that something occurs that affects the ability to trade normally. A business interruption insurance cover can provide protection in a wide range of circumstances:
- Loss of business earnings in the event that you cannot trade normally
- Cover for fixed costs that you will continue to be liable for (staff wages, rent or mortgage)
- Protection from the additional costs that you may face in the event of an insured event (temporary premises rent, hiring in replacement equipment or machinery)
In establishing your needs to provide a quote for business interruption cover, working with your broker will mean that you are effectively documenting the key issues that may affect your business. A bi product of being able to demonstrate a clear and responsible business continuity plan to a would-be insurer is that they may be able to offer you a premium that reflects good management, on the basis that the business is well placed to minimize the impact of a problem that may arise.