5 Steps To Develop a Business Interruption Plan
Business Interruption Plan
Flooding and other natural disasters can cause businesses in Lakesite, TN, to shut down for good. However, implementing plans to deal with certain situations, such as a broken pipe and getting water restoration professionals quickly, can help your company survive. This is known as a business interruption plan, and there are several different steps to help you develop it.
1. Determine Your Risks
When calculating the risks that could interrupt your operations, examine both environmental and human-caused risks, such as flooding and a running faucet. Consider which ones you can prevent and the unavoidable ones. Once you have identified them, you should delve deeper into each hazard. Then, rank your disasters based on their likelihood of occurring and their severity.
2. Calculate the Costs
Once you have analyzed all potential risks, calculate the costs they would bring. For example, flooding could cause lost income, extra expenses, contractual penalties, and business closure.
3. Read Your Insurance Contract
The next step is to examine your insurance policy. Interruption insurance can be filed for when there is property damage or a government shutdown that prohibits your business from operating. These funds are available during the period of restoration. However, each policy can differ, so you must closely examine yours to understand any restrictions, such as exclusions, waiting periods, and coverage limits.
4. Implement Prevention Strategies
There are several strategies that you can develop to reduce your interruption. This includes preventing risks, deterring criminal activity, and planning to mitigate unpreventable hazards.
5. Create Communication Plans
Having a communication plan is the best way to keep customers and employees informed about your business's status during a disaster. A good plan will include a command chain, scripted messages, and open communication channels.
Taking these steps helps minimize the interruption of your business from large water damage and other disasters. This is the basis for creating a business interruption plan.