Climate extremes are taking effect across Australia, with 2022 seeing a record-breaking report of extreme weather events. While a third consecutive La Niña led to extreme rain and flooding that devastated eastern Australia and an extreme rain record in Sydney, Australia’s hottest temperature was recorded in Western Australia.
It is expected that climate change will continue to increase the frequency and severity of natural disasters, even with dramatic, rapidly implemented cuts in greenhouse gas emissions. While there may be little that Business Owners can control, you can take steps to minimise the impact of disaster on yourself and your business.
Business Insurance provided by an experienced Insurance Broker such as Atlantic Insurance is one such form of protection that can ensure that, in the face of extreme weather events, your business will be able to stay afloat. Find out more about recommended policies and other ways to prepare your business for the worst.
Natural Disaster Risk Analysis
To understand the extent of cover and the types of Business Insurance required for protection of your business, you should undertake a risk assessment. This will help you to identify the events that are most likely to affect the business including its location and property, what business assets may need to be covered, potential business interruption impact, a supply chain analysis, and determine if data is at risk of being breached. The identified risks should be regularly reviewed to ensure currency.
Common exposures associated with natural disasters for businesses include:
- Damage to property and assets
- Interruption to business operations
- Supply chain disruption
- Loss of data
- Employee safety
A reliable Insurance Broker such as Atlantic Insurance is able to offer a comprehensive risk analysis and professional advice to ensure the best cover options. Atlantic can offer invaluable advice to assist with identifying and transferring risk to Insurers in order for your business to remain protected in the event of natural disaster.
Recommended Business Insurance Policies To Protect
For insurance to cover the potential risks of natural disaster and ensure your business is able to recover, the following policies are recommended.
1. Property Insurance
If any damage were to occur to your business property and valuable items, this policy is able to cover the cost of repairing or replacing lost or damaged items. This can assist with covering damage to buildings, equipment, inventory, and other physical assets owned by the business.
2. Business Interruption Insurance
Should your business operations halt due to damage to your premises following the impact of a natural disaster, this policy covers losses of revenue during the period in which the business is unable to continue operating. This can offer crucial financial protection that can ensure business continuity.
3. Transit Insurance
This policy is recommended if you move goods locally or internationally, and will protect the carriage of your goods should damage occur during transit. This is useful in the event of extreme weather conditions impacting transit.
4. Construction Insurance
An important policy for builders and those in the trades industry, this policy is able to offer cover for fire, theft, malicious damage, storm, hail, cyclone, flood and accidental damage during a construction period.
5. Commercial Motor Insurance
If your company relies on vehicles for operation, a policy such as this will provide cover should they become damaged in an extreme weather event.
General Risk Mitigation Protocol
Other than Business Insurance cover, you can ready your business for the potential impacts of natural disaster by:
1. Developing An Emergency Response Plan
A response plan is crucial in order to conserve time and energy in the midst of a crisis and ensure you can take action right away. It is important to outline procedures for evacuations, a communication strategy, ways to support employee safety, plans to secure assets, and assign roles & responsibilities amongst employees.
Connecting with local community disaster response agencies is also recommended to ensure external resources for assistance to better support your business and employees.
2. Business Continuity Planning
Business continuity planning (BCP) involves devising a process to ensure your business can continue to operate and deliver essential services or functions through disruptions or disasters. Key elements of BCP involve:
- A risk assessment
- A Business Impact Analysis to determine critical functions, recovery time and recovery point objectives
- Strategy development for each essential service
- Resource allocation
- Testing and training of the BCP
Protect Your Business Against Natural Disaster With Atlantic Insurance
Atlantic Insurance has assisted small, medium and large businesses to thrive in the face of challenges since the early 1980s. With a range of experience providing specialised risk management guidance and insurance products to businesses in a variety of industries, you can rely on Atlantic to ensure your business is protected.
Any information contained on this page of the website is general advice only and has been prepared without taking into account your objectives, financial situation or needs. Your should consider these, having regard to the appropriateness of this advice and the relevant Product Disclosure Statement (‘PDS’), Target Market Determination (‘TMD’) and Financial Services Guide (‘FSG’), which will be provided following any formal recommendation to you.