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Volume 31, Issue 2

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Insurance companies spend an increasing amount of time helping companies reduce potential business interruption. The reason: it’s a win-win strategy for all parties involved. At least 50 percent of the money commercial insurance companies take in from business interruption claims is actually paid back out to clients. The faster you mitigate a loss, the faster the insurance file is closed. This translates into reduced costs for the insurer and the insured, and reduced company “downtime.”

There’s no time to get your ducks in a row once the disaster has already wreaked havoc on your business. While business continuity planning is a top corporate priority today, many disaster recovery planners fail to realize the ideal plan calls for more than just IT/data backup. Without a plan in place to restore the actual facility/office, business may not be able to continue.

Effective business continuity plans reflect collaborative partnerships between a company and each of its vendors involved in the “supply chain” of the recovery process. Here are a few tips for proactive business continuity planning.

On the pre-loss side:

1) Determine critical areas. What needs to be restored or back in business first?
2) Facilitate a facility walk-through with each vendor and, if possible, the potential adjuster.
3) Understand the business interruption exposure. What is the cost of downtime?
4) Consider how your company will be impacted if a company in your network supply chain goes out of business.
5) Establish pricing structure and rates up front.
On the post-loss side:
6) Set reserves and expectations for the insurance company.
7) Schedule regular meetings to reconfirm priorities and answer questions. Establish familiarity with each vendor’s capabilities and personalities.
8) Communicate ... communicate ... communicate.


Jim Willis is the director of commercial restoration for ServiceMaster Clean. He has 25 years in the industry.