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  • Has your business set aside time for flood planning?

    Set aside time for flood planning

    Flooding is becoming increasingly more common in the UK, and the costs involved for a business can unfortunately be catastrophic. With the rises in sea-level, and extreme weather events taking place across the globe, flooding is one of the next biggest risks for business. Following the extreme costs involved after the impact of a flood there is a call for better preparation ahead of storms, more attention on mitigating the effects of flooding should be considered as disruption to business can significantly impact on your future survival.

    The cost to business

    According to research produced by the Federation of Small Businesses, more than half of those businesses located in flood plains do not have property flood insurance in place. Small businesses in Northern England and Scotland were hit hard by floods in 2015, and scarily, nearly a fifth were still not operational a year on.

    Data from the Environment Agency suggests that as many as around 185,000 commercial properties are at risk of flooding in England and Wales. In 2015 Storm Desmond alone cost the country an estimated £5 billion, and with the Met Office claiming that rainfall is expected to rise by 20-30% over the next ten years this is a worrying prospect.

    Business interruption and flood planning

    It should not be underestimated that water damage can be equally as destructive to your business as fire damage. It will interrupt your business and require a large scale, costly clean up. In addition to gaining the right flood cover for your business, it is important to implement a flood response plan which can be carried out to minimise risk should a flooding incident occur.

    Having a flood plan in place will help to show your insurer that you are prepared for water risk and that you will be able to respond appropriately. It may even enhance your risk profile and potentially allow you a lower premium depending on provider, as well as helping to secure your cover.

    Help for business

    Many small businesses situated on flood plains can struggle with insurance. Flood Re is in place to provide an affordable and available home insurance to those areas prone to flooding, but businesses do not have similar aid. Meanwhile, the British Insurance Broker’s Association (BIBA) has been working with the government to promote better resilience to business in the form of flood defences and resilient repairs. BIBA have also launched a scheme to ensure commercial properties are able to access insurance of they were at risk of flooding. At the moment, Flood Re only provides insurance to homes at risk, but many SMEs are also faced with the same worrying situation.

    With all of this in mind businesses need to improve their resilience to flooding, with the importance of insurance not being underestimated. Water damage can often bring businesses to a halt, destroying the interior and structure of the premises which can be a timely process to refurbish.

    Whilst the business is closed you will be losing significant revenue as well as continuing to pay rent and for losses incurred as well as continued payroll. It isn’t just about insuring your business from water damage, it’s also about having business interruption cover in place so that your bottom line is not impacted.

    How to put a flood plan in place

    The potential costs to your business can be devastating. In fact, in 2015, the Calder Valley Boxing Day flood on average cost each business involved £47,000, almost half of which had not put in place flood planning. By carrying out research into your business surroundings and all possible water entry points you should be better placed to prepare for the possibilities ahead. There are many specialists available with expertise in flood assessment who you can call on for a thorough review.

    As part of your flood plan, flood defences can be put in place to protect your business from flood damage and important equipment could be considered for moving to higher grounds to continue production in the event of flood damage. You should listen to daily weather forecasts and set up severe weather warning alerts to be prepared. You can check if your business is in a high-risk area on the Environment Agency website here.

    It is also a good idea to delegate responsibilities in the event of flooding. These can also be given to different members of staff so that you have a clear process in place with an evacuation plan which should be tested regularly.

    Whilst it can be really tough to predict when a flood may strike, it can be relatively easy to ensure flood plans and insurance preparation is in place. Think ahead and make sure you set aside time for flood planning…

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