Professional Insurance Programs

Preparing Your Business For the Unthinkable

Preparing Your Business For the Unthinkable

Disasters can happen anywhere, often with little or no warning. Is your business prepared? What can you do to protect your business, employees and customers? Where should you begin?

Disaster Recovery Begins Before a Disaster

Why bother? Disasters don’t happen here. Even if you think you are not in a disaster-prone area, something like a chemical tanker truck overturning can prevent you and your employees from getting to your facility.

Even if a flood doesn’t put your business under water, customers and supplies may not be able to get to you. Power outages, brown-outs or surges can affect your daily business operations. Many disasters, like wind storms, tornadoes and earthquakes, can strike quickly and with little or no warning.

What can I do?

Find out which natural and technological hazards can happen in your area.

Get information about how to prepare your employees and clients to respond to possible hazards and provide help. Disaster safety information and CPR/first aid training are available from your local Red Cross chapter. Get more information at

Network with others who have or need to develop risk or contingency management plans.

Attend seminars and get information from local risk management associations or chapters.

No business should risk operating without a disaster plan.

While reports vary, as many as 40 percent of small businesses do not reopen after a major disaster like a flood, tornado or earthquake. These shuttered businesses were unprepared for a disaster; they had no plan or backup systems.

When you start to develop your disaster plan, consider three subjects: human resources, physical resources and business continuity. Think about how a disaster could affect your employees, customers and workplace. Think about how you could continue doing business if the area around your facility is closed or streets are impassable. Think about what you would need to serve your customers even if your facility is closed.

Develop a Plan 

Here are some suggestions your may want to consider:

  • Keep phone lists of your key employees and customers with you, and provide copies to key staff members.
  • If you have a voice mail system at your office, designate one remote number on which you can record messages for employees. Provide the number to all employees.
  • Arrange for programmable call forwarding for your main business line(s). Then, if you can’t get to the office, you can call in and reprogram the phones to ring elsewhere.
  • If you may not be able to get to your business quickly after an emergency, leave keys and alarm code(s) with a trusted employee or friend who is closer.
  • Install emergency lights that turn on when the power goes out. They are inexpensive and widely available at building supply retailers.
  • Back up computer data frequently throughout the business day. Keep a backup tape off site.
  • Use UL-listed surge protectors and battery backup systems. They will add protection for sensitive equipment and help prevent a computer crash if the power goes out.
  • Purchase a NOAA Weather Radio with a tone alert feature. Keep it on and when the warning signal sounds, listen for information about possible severe weather and protective actions to take.
  • Stock a minimum supply of the goods, materials and equipment you would need for business continuity.
  • Consult with your insurance agent about special precautions to take for disasters that may directly impact your business. Remember, most policies do not cover earthquake and flood damage. Protect valuable property and equipment with special riders. Discuss business continuity insurance with your agent.
  • Keep emergency supplies handy, including—
    • Flashlights with extra batteries
    • First aid kit
    • Tools.
    • Food and water for employees and customers to use during a period of unexpected confinement at your business, such as if a tanker truck over-turned nearby and authorities told everyone in the area to stay put for an extended period.

Reduce Potential Damage

Prevent or reduce disaster damage in your facility by taking precautions, such as:

  • Bolting tall bookcases or display cases to wall studs.
  • Protecting breakable objects by securing them to a stand or shelf using hook-and-loop fasteners.
  • Moving to lower shelves large objects that could fall and break or injure someone.
  • Installing latches to keep drawers and cabinets from flying open and dumping their contents.
  • Using closed screw eyes and wire to securely attach framed pictures and mirrors to walls.
  • Using plumber’s tape or strap iron to wrap around a hot water heater to secure it to wall studs.

Protect Your Employees, Customers and Business

Designate one employee from each work shift to be the safety coordinator. This person will make all decisions relating to employee and customer safety and to the safety of the business itself. Safety coordinators should know how to contact the owner or operator at all times.

Everyone in your facility should know how to prepare for a disaster and what to do if a disaster occurs. Contact your local Red Cross chapter for specific information about how to stay safe in a tornado, earthquake, fire, flood, hurricane or other hazard.

You may also want to get a copy of the Emergency Management Guide for Business and Industry from your Red Cross chapter or

Source: American Red Cross