Winter poses all sorts of threats to businesses. Potential for certain types of crime increases, while extreme cold can deliver liability concerns. There is also an increase in flood risk, with winter egging it on via snowmelt in the back half of the season. A flood can be so detrimental to public and commercial interests that the Government of Canada has launched a new public awareness campaign. In an effort to do our part, Park Insurance is helping spread awareness too. A few months ago, we announced that residential flood insurance is now available in Canada. We’re following up that exciting news with a look at the commercial sector, via an easy-to-follow guide to protecting your business from the threat of a flood.
5 Tips that Will Help Protect Your Business from Flood Risk
1. Assess the Risk of Your Region
You wouldn’t buy a home without inquiring about the local climate, geology, and related threats to your property. That same due diligence must be applied to your business (current or new). For example, tsunamis can bring floods to coastal areas, with certain zones being higher risk than others. Contact your local municipality to identify floodplains and dike systems. Lastly, understanding the history of the climate in your area will help you assess the level of flood risk. After all, history does repeat itself. Reference historical climate data in Canada to make sure you’re ready for the future.
2. Identify and Protect Critical Assets
Assess your critical assets and note their location within your place of business. There are obvious and less obvious action items. Obvious ones include keeping valuable product and materials off of the floor. The same goes for those boxes of sensitive documents (invoices, etc.). If floodwater can reasonably reach any of these assets, you put your business at risk.
Less obvious action items are no less important. For example, if online operations (website, data warehouse, etc.) are crucial to day-to-day business, they are considered critical. Where is your server located? If in-house, find out if the server room is adequately protected from flood risk. Is the hardware well enough above ground to keep it out of reach? Are the cables and plugs out of harm’s way too? Walk from room to room in your shop, office, or warehouse and take careful note of anything that can be reached by pooling.
Remember, even if your business is beyond natural flood water levels (i.e. an office tower), internal utility management systems are also potential sources of flood risk. Not only should you keep susceptible items off of the floor, you will need to note the location of pipes directly above, behind ceiling panels.
3. Identify Directs Threats to Your Business Beyond Your Place of Business
Even if your business is in a relative safe zone, there are direct flood threats that can hamper operations and revenue. If there is a match between where your staff, suppliers, customers and/or transport routes are located and high risk flood zones, you must be prepared to take on a loss. Can you reduce your risk by enabling key staff to work remotely (where applicable) or keeping a certain percentage of inventory with another supplier (where applicable)? Some advance planning can go a long way to minimizing downtime.
4. Have an Emergency Flood Plan in Place
Resolve to have this plan in place, today. This plan will vary by business, but the following is a good place to start:
- Supplies – This includes anything that will keep staff and customers safe during a flood, including food, water, heat, lighting and sanitation supplies to last the average number of people on the premises for at least 3 days.
- Brief Staff – Your staff must be fully briefed on this plan, and where appropriate delegate assignments so that they can assist in flood response to protect the business and/or customers within. Going the extra mile with staff training will go along way when it comes to flood preparedness. Provide CPR training through Canadian Red Cross or your local municipal Emergency Management Office.
- Secure Documentation – While on-site business records and documents are to be stored in a flood-safe location (as per item #1) you should also store duplicates at a safe and secure off-premises site, ensuring that regular backups are made.
- Set-Up Alternative Communication – Telephone systems may be disrupted during a major flood. Consider alternate methods of wireless communication with employees, suppliers and customers. Today, many flood emergency plans include the use of Twitter. A group can be created in advance, which allows participants to take to Twitter for updates.
- Cross Tenant Coordination – If your business is in a mall, complex, or tower then you will need a well coordinated and cohesive emergency plan that involves your neighboring tenants. Don’t wait for them to come to you. Be the one to initiate this process.
- Practice – Regularly practice flood response and recovery activities. Not only will this align staff and tenants, it will help you identify holes in the plan and lead to revisions that can save your business, and perhaps even the lives of those within.
5. Review Your Insurance Policy
Don’t trust your own eyes here. You may not know exactly what to look for. When it comes to a flood, inadequate insurance coverage can open the floodgates to liability and insurance risk. Contact a full-service, independent insurance broker who can provide an unbiased assessment of your commercial flood risk, and provide you with any additional coverage, if and where required. At Park Insurance we are happy to help you with your risk assessment and provide a no-obligation review of your insurance policy . Call us directly at 1.800.663.3739 or complete the form found here.
