As reported in a recent article posted on the Continuity Forum website, insurers in the U.K. are sharpening their focus on business continuity planning being at the heart of an organization’s planning strategies and action plans for a response to the many risks facing business in general. Our staff believes similar concerns are shared in the U.S. over this same issue.
Experience in New York following 9/11 and generally in areas ravaged by the recent floods indicate that Small and Midsized Enterprises (SME’s) are the most vulnerable to the effects of business disruption, suffering far more than their Multi-National cousins or counterparts. And even more important are recent findings in both the U.S. and U.K. that most SME’s are failing to ensure even basic preventive planning for disruption to their businesses and are also likely to have the lowest levels of appropriate insurance coverage or Business Continuity provisions in those insurance plans. Research in both the U.S. and U.K. indicates that with less or no business continuity planning in place for those SME’s, costs and time to recovery increase.
Because of that potential increased cost burden, some people believe that this move is part of a broader drive within government and the Insurance industry to shift more of the responsibility back from the Insurers to the organizations themselves.
There is little doubt that insurers and governments are becoming more concerned about those future potential and increasing costs — in the future, organizations will have to do a better job in planning for and recovering from disruptive events, incidents or disasters — or perhaps, governments and the insurance industry will come up with a more effective way to make those organizations do just that.
What are your thoughts about this? Do you see it as a potential trend and reality for SME’s? If it becomes some sort of obligation or regulation for business continuity planning to be at the heart of any organization’s strategic planning in the U.K., will the same follow here in the U.S.?
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If applicable, please pass this information along to the business continuity and risk management team members in your organization.