Think HBR

Protection against life’s ‘what ifs…’

Mark Bramley
As a business owner, you are your own risk manager. Your primary responsibility to your business is to stay open and running, no matter what life brings. But have you ever considered what your business would need in order to stay open should unforeseen circumstances interrupt your normal operations?
Ask yourself: what if a fire in your café destroyed the kitchen and you had to close for 2 months while repairs were made? Worse still the café was completely destroyed and unable to be opened for a year? What if a major natural disaster meant you couldn’t access your premises for a whole week? Or how about if an electrical fire at a retail precinct prevented customers accessing your business for an unspecified period? Could your business survive? Would you still be financial?
In these scenarios, it’s important to consider how you would cover the loss of business income. And what about paying staff wages or loan repayments if revenue isn’t rolling in as expected? As a property owner, could you cover the loss of rent?
If you don’t have the answers to those questions, it could be the right time to consider adding business interruption insurance to your insurance program.
Business interruption insurance – sometimes known as business income protection insurance – can reimburse you for lost income while your doors are closed to customers, and ensure loans and staff wages can be paid. Should you need to move premises on a temporary basis, business interruption insurance can also address those costs.
In today’s economic climate you can’t put a price on the relief this protection brings to business owners in the face of an already stressful claim situation. It could even make the difference between living to fight another day, or having to close your doors permanently.
This isn’t just scaremongering, either. Although stats vary quite wildly depending on the source, a significant number of businesses (perhaps as many as 70%) that suffer from a major interruption to their normal operations never recover.
But while business interruption insurance is one of the most important safeguards you can put in place to protect your business in the longer term, it’s also one of the least understood policies, and least taken up by business owners. It’s certainly worth talking to an insurance broker about the relevance of the cover for your business, as they’ll be well placed to advise on the best options for you to consider.
For further information contact Gallagher on (02) 4979 3333, email or visit
Mark Bramley Mark Bramley
Mark Bramley is an Area Director at Gallagher and has worked in the financial services industry for more than two decades.