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Risk Mitigation

Not all disasters can be prevented, but there are many mitigation strategies that can reduce damage to your business from a disaster. Implementing those strategies before a disaster may make it easier for your business to recover.

Strategies to Consider

  • Research applicable fire prevention regulations, national standards and best practices to identify mitigation opportunities and requirements.
  • Speak with your insurance agent, broker or underwriter to determine if they provide consultation services to help customize protection for a new or renovated facility. Highly protected facilities may be eligible for reduced insurance premiums.
  • Consider selecting a building site that is not subject to flood, storm surge, significant ground shaking from earthquakes or in proximity to hazardous facilities . Building construction should meet applicable building codes that include requirements for fire protection and life safety.
  • Strategies to mitigate business disruption include providing uninterruptible power supplies (UPS) and an emergency standby generator for critical equipment. Developing a business continuity plan with recovery strategies is another method of risk mitigation.

Insurance as Financial Mitigation

Purchasing insurance is a way to reduce the financial impact of a business interruption, loss or damage to a facility or equipment. Review your insurance policies with your agents, brokers or directly with your insurers to determine whether your insurance policies adequately cover your potential losses.

Flood insurance coverage for a facility located within a flood zone may be purchased through the National Flood Insurance Program. Earthquake, terrorism and pollution coverage may be purchased separately or as an endorsement to an existing policy.

Business interruption coverage reimburses profits and certain continuing expenses during a business shutdown. Contingent business interruption coverage is available to reimburse losses caused by a supplier failure. Endorsements to standard policies can cover extra expenses such as the additional costs for expedited delivery of replacement machinery following an insured loss.

Risk Mitigation Resources

 Natural Hazards

Human-Caused Intentional Acts

Technological Hazards

Last Updated: 02/28/2024

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