It’s impossible to run a business without the occasional interruption. What matters most is that your organization has a plan in place to deal with the fallout. The only solution that ensures the company will stay in business after the event is having proper business insurance. San Diego business owners should be aware of the five most common causes of business interruption and how they impact companies.
1. Fires & Explosions
Fires and explosions are the most common threats to business continuity. Review your current coverage to make sure the policy covers these dangers. If not, it’s worth adding supplemental plans or additional coverage. Otherwise, your entire operation could fail if you experience a serious fire or explosion.
2. Natural Disasters
Nothing can wipe out a company’s operations like a natural disaster. The natural threats that can imperil a company are well known in most areas and include hurricanes, tornadoes, and other substantial weather events. In the event of a hurricane or other significant disaster, often the only possible way to continue operating the business is by rebuilding or relocating. Either of these solutions takes massive amounts of capital or reliance on an insurance payout.
3. Supplier Failure & Lean Processes
Lean processes and failures at the supplier level can also cause a business to fail quickly. There are numerous strategies to mitigate supply chain risk, and they’re well worth implementing. It’s also possible to purchase specific supplier failure insurance, and it may be worth the investment. Depending on how risky the situation is, extra insurance is the best way to safeguard against a complete shutdown.
4. Cyber Incidents
The connected business world provides many benefits, but it also has a few significant drawbacks. Most notably, cyberattacks are a constant threat that can cause incredible financial damage to organizations. Cyber insurance is the primary way to mitigate the damage from a full-blown attack. With the proper coverage, a company can hope to withstand the aftermath of a significant intrusion or hack. Cyberattacks continue to gain in popularity and complexity. It’s an ideal time to add cyber insurance, especially if your organization is networked and uses the Internet to conduct a large percentage of its business.
5. Machinery Breakdown
Companies that rely on machines to produce products can fail if the machines break down too rapidly or deteriorate to the point of no return. When a threat like this exists, it’s worth having machinery breakdown insurance. That specific coverage will cover unexpected and sudden damage to machines. The insurance company will pay to replace the machinery, which will keep the business running smoothly.
Owning a business involves assuming certain kinds of risk, but operating without business interruption insurance is a risk you shouldn’t take. The dangers listed above are just a few of the factors that make this type of coverage an absolute necessity for many businesses. For reliable, affordable business and commercial insurance as well as homeowners, renters, motorcycle, and car insurance, reach out to the experienced professionals from Altra Insurance Services. Call us today at 619-474-6666 to find out how we can meet all your insurance needs.