SCORE Small Business Blog

Disaster Planning: Be Prepared
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Cover Your Assets

Entrepreneurs are optimistic and don’t want to dwell on the dark side. Unfortunately, bad things can happen—a fire or flood can wipe out inventory, a storm can cut electricity for days or longer, a customer can be injured on your premises. These occurrences can be financially costly and emotionally draining, unless you plan ahead with adequate insurance and disaster planning.

Make sure you have all necessary insurance policies in place before you open your doors for business. At a minimum, you need a business owner’s policy (BOP) to cover your business assets as well as provide liability protection in case third parties (customers) suffer injury. If you have any employees, you’ll need workers’ compensation as well as short-term disability in some states.

You’ll need to avoid insurance gaps. If you use your personal car for business driving, make sure your car policy covers accidents while on business. If you have a home office, check with your insurance agent to determine whether your homeowner’s coverage provides protection for your business assets and for liability claims from business visitors. You may need to add onto your homeowner’s policy or obtain a BOP.

With storms and other natural disasters making headlines, don’t fail to plan for the worst case scenarios. Be certain to regularly back up data on your computer (preferably to offsite servers) so you can recoup information if computers are damaged. Think what you’d do if your business location was not operable; maybe you and your staff could work remotely. Write plans for you and your staff to follow in case of emergency.

Learn about the types of insurance you may need for your business from InsureU.

Barbara Weltman, Guest Blogger
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