A Guide to Hurricane Preparedness for BusinessesRisk Management
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If your business is located in an area of the country that experiences major storms regularly, everyone at your facility should know what to do and how to prepare for a hurricane.
According to the American Red Cross and the Federal Emergency Management Agency (FEMA), almost half of all small businesses affected by a major disaster—such as a tornado, flood, earthquake, or hurricane—do not reopen their doors because they were unprepared for the disaster.
In preparation for such a potentially disastrous event, these are some questions that, as a business owner, you should asking yourself:
- How could I continue to conduct business if the city (or even just the streets near my building) is closed off?
- How could I serve my customers if my facility needs to close for several months?
- Could my business survive if it were to close down for several weeks or months?
While businesses have asked and answered these questions during the ongoing COVID-19 pandemic, the additional exposure to physical property damage and loss during a natural disaster can change the responses, principally because those businesses with remote workers now have the added exposure to their at-home employees experiencing loss or damage and thus further delaying recovery.
Risk of loss can be mitigated and even transferred with appropriate insurance. As experienced brokers, we cannot stress the following enough:
All businesses should double-check their property insurance coverage in their business owners policy (BOP), commercial property insurance policy, or specific wind pool policy to ensure that coverage exists. If you’re unclear about this, be sure to contact your broker. If you aren’t properly protected at this moment for hurricane-related damages, it is possible that special coverage needs to be purchased.
Preparing for a Hurricane
Consider incorporating the following hurricane preparation suggestions into your business’s plan for dealing with natural disasters of this type in order to (hopefully) avoid unnecessary upsets in the event that disaster strikes:
- Send non-essential employees home and have enough lead time for essential employees to get to safety:
- Prepare a list of your employees and their contact information. Find out where they may vacate if you are required to evacuate the city.
- Provide employees with a chain of command and a list of responsibilities in the event that a disaster strikes.
- Arrange for communication with your clients and customers, in the event of a disaster, to keep them informed.
- Gather a list of vendors and telephone numbers of individuals or entities that are critical to your daily operations. If you heavily rely on one or two vendors, consider adding a backup vendor outside of your area.
- Prepare a list of companies that can assist you in recovery efforts, such as removing debris, moving, and computer services.
- Check local flood maps. Have your building inspected by a licensed professional to ensure that the roof and other connections comply with the wind loading requirements for your area.
- Consider installing impact-resistant film on your windows.
If essential employees may be confined for several hours, or even days, consider stocking the following items at your place of business:
- Face masks or coverings
- Flashlights and extra batteries
- Battery-powered radios
- Paper plates, cups, and utensils
- Manual can opener
- Germicidal hand wipes and alcohol-based sanitizer
- Ready-to-eat canned foods, fruits, vegetables, and energy foods such as granola bars. Select foods that do not require refrigeration, cooking, or preparation.
- Water stored in plastic containers
- First-aid supplies:
- Adhesive bandages
- Sterile dressing
- Roller gauze bandages
- Triangular bandages
- Gauze pads
- Non-latex gloves
- Adhesive tape
- Cold packs
- CPR face shield
Urge employees to keep a three-day supply of their medications on-hand, pain relievers and stomach remedies, and an extra pair of reading glasses.
Preventing Property Damage
- Secure hurricane shutters, doors, windows. Board up if possible to prevent glass breakage/debris spread.
- Bolt tall bookcases and displays to the wall studs.
- Secure small property in containers or other protective environments (e.g. bins, drawers, cabinets).
- Install latches on drawers to prevent them from flying open.
- Secure pictures and mirrors to the wall with closed screw eyes and wire.
- Secure your water heater to the wall studs with plumber’s tape or strap iron.
- Install flexible connectors to appliances using natural gas and automatic fire sprinklers.
Further Best Practices to Consider
- Constantly diversify your customer base, products, and sales locations. This will prevent a major loss that could occur in the event that a majority of your customer base is also affected by the hurricane.
- Designate a remote phone number on your voicemail system for which you can record messages to employees in the event of an emergency.
- Arrange for programmable call forwarding of your business lines with the phone company. You can then call and reprogram your phones from a remote location if needed.
- Install emergency backup lights and/or generators that turn on when the power goes out.
- Back up your data on a frequent basis and keep this information off-site or in cloud storage.
Even if a hurricane does not put your company out of business, you may not be able to make contact with your customers and/or obtain important deliveries right away. To mitigate these risks, you must take the necessary steps before a disaster strikes to ensure business continuity.
If you anticipate your business being impacted, you may consider notifying your customers and vendors ahead of time so that they are aware and can support you in your return to normalcy.
Additional Insurance Considerations
It’s very important to stress that in addition to the various precautions that you should take in-house, having adequate insurance coverage to protect against losses is just as important.
Beyond typical policies, consider flood insurance and business interruption coverage policies. Also, have your business appraised regularly, at least every five years, and provide appraisal documentation to support your property values for your insurance policy.
Be sure to conduct regular inventory checks of your supplies and equipment, including photographs of these items, purchase dates and amounts, and descriptions. Maintain this information digitally or at another secure, off-site location.
If you have any questions or concerns about your coverage and would like to talk to a dedicated insurance professional, don’t hesitate to reach out to one of our expert brokers at any time.
It’s very important to clearly understand what each type of policy offers before deciding whether named perils or all-risk insurance is the right type of commercial property coverage for your business.
Business owners must make a decision between “actual cash value” and “replacement cost” coverage when defining the type of coverage that works best for their business property’s risk profile.