Self Employed: Disaster Planning
Hurricane Katrina, 9/11 and electrical blackouts have brought home that we all need to plan for natural or other disasters. As a self employed person, a disaster could hit you particularly hard.
The key is to get back in business as quickly as possible. Appropriate property and casualty insurance is important, but insurance doesn't address the confidence that people personally have in you. The faster you can be back to work, the faster you can reassure people that you can deliver.
In order to plan for disaster, consider the following steps:
Create a "Just In Case" Business Plan. Include what to do about your health condition in the event of a disaster.
When thinking about what to include in a plan:
- Plan for the worst possible scenario.
- In addition to considering what would happen if disaster strikes, make plans in case disaster strikes the business of a major supplier.
- Think about the kinds of natural and other disasters that can hit your business. Tornadoes? Earthquakes? Floods? If the sprinkler systems malfunction, do you have a supply of easily accessible plastic coverings?
- What critical business activities and resources are needed to support them to maintain your business and customer service while your business is closed?
- Back up your computer often and make copies of important written documents. Take copies off premises to a safe, secure fireproof location, perhaps even out of the area.
- Include in your plan what to do about your health condition in the event of a disaster.
- How do you assure a safe, continuing supply of medications?
- What if something happens to your doctor, or the facility at which you receive treatments. How will you continue to receive needed treatment?
- Is there a copy of your medical records in a safe place? (For more information, see Medical Records).
In addition, according to the Insurance Information Institute:
- Find alternative facilities, equipment and supplies.
- Consider back-up sources of power and communications systems.
- Stockpile supplies you may need such as a first-aid kit and flashlights.
- Compile a list of important phone numbers and addresses, including local and state emergency management agencies, major clients, contractors, suppliers, financial institutions and insurance agents. Keep copies off the premises in case the disaster is widespread.
- Decide on a communications strategy to prevent loss of clients/customers. They must know how to contact you.
- Review your plan regularly to keep it up to date (Perhaps set an alert on your computer, or in your diary, for once every year).
Consider Business Continuation Insurance
A Business Continuation policy (also known as Business-Interruption Insurance) provides ongoing cash to cover ongoing rent obligations or to spend on whatever you feel is necessary to restart the business. It can be purchased as a stand-alone policy or added to your office policy.
Look at policies which cover specific disastrous situations depending on the risks where you are located. For instance, you can purchase flood insurance, hurricane insurance, earthquake insurance, sewer backup and computer coverage (which covers data losses).
Learn How To File Claims
The sooner you file a disaster claim, the better. Claims are usually settled in the order in which they are received. Take photos of the damage as soon as you can after it has occurred to show how much has been damaged.
Learn how to file an insurance claim in case you need to and no longer have access to your office
For information about filing an insurance claim, click here.
For information about disaster planning for the rest of your life, including medications, and getting the medical care you may need, click here.