2 out of 3 small-business owners don’t have a written plan in case a natural disaster strikes, according to a study.
A recently released online Harris Poll conducted by Nationwide Insurance has revealed some scary statistics about the preparedness of America’s small-business owners for natural disasters. Considering how wild 2017’s weather has been thus far, it seems like there’s no better time than the present to start thinking about the well-being of your own business.
When Nationwide analyzed over 100,000 commercial catastrophe claims, they noticed some major changes in the past few years. It seems that the average severity of the commercial catatrasophe claims have increased by more than 25%. Additionally, they found that there was a 14% increase in “unique catastrophe events” in that same timeframe. This means that it is more crucial for business-owners to plan for the worst. Yet…the majority of them are not prepare with a disaster recovery plan.
Some Business Owners “Don’t Think it’s a Priority”
Why aren’t most if not all business owners prepared for the worst? Well, 21% of those small-business owners without a written disaster recovery plan say “it’s just not a priority” for them.
Not a priority? Well, maybe it should be one considering a quarter of businesses never reopen after a natural disaster. Or considering that 22% of small-business owners have already seen the impacts of natural disaster…
Yet, 71% of small-business owners don’t have business interruption insurance. Business interruption insurance is absolutely vital in being able to reopen your business after disaster.
It’s not all bad news for business owners though. The same study found that 82% of small businesses were able to work remotely in the event of a natural disaster, 3/4 had copies of vital records stored offsite, and almost 80% said they had access to alternative suppliers.
What Happens to Insured Businesses After Disaster?
Despite many small businesses operating without a formal plan in case of disaster, some entrepreneurs have seen the benefits of properly insuring their business. For example, in 2014, a man named Dan Oswald saw a super rare twin tornado destroy his Nebraska-based seed company. He was able to file an insurance claim before the governor even declared a state of emergency. The result? He was able to rebuild his facility 66% larger than it was. “I knew what a. tornado could do. but you never think it could hit your place,” Oswald said, “But two days after the tornado, I had a check in my hand.”
With spring storm season almost here…does your small business have a disaster recovery plan?