Insurance

Many organizations consider insurance a necessary evil. Perhaps, however, you should examine your policies and see if you have everything you need to protect yourself and employees - what haven't you thought about? This week's articles can lead the way.

Insurance that has great relevance in a business continuity context and that is greatly misunderstood is Business Interruption insurance. (Item #1)   Here's how to use life insurance to secure your business after death. (Item #2)   Most continuity plans still overlook the essential question with the most profound impact on long- term financial recovery: Who's going to pay for it all? (Item #3)  

Most business owners don't have interruption insurance; should you be rethinking this? (Item #4)   Do all nonprofit organizations need Directors and Officers Liability Insurance? (Item #5)   The process of selecting insurance for your business may be tedious, but if calamity strikes you'll be happy that you're properly insured. (Item #6)  

As always, we look forward to hearing your comments & insights regarding business continuity. If you have a topic you'd like us to cover, email me at [email protected].

Bob Mellinger, President
Attainium Corp

1. Business insurance - What you may not have thought about...

Insurance has great relevance in a business continuity context but is an area which is often greatly misunderstood. Whether it's at a personal level, trying to understand the seemingly arbitrary way the renewal premium is obtained for their car insurance policies, or comprehending the scope and cover of more complex corporate insurance programs, most people seem to have a difficulty with the subject.
http://www.continuitycentral.com/feature0181.htm

2. Using Life Insurance to Secure Business Continuity

If your business is a small business or partnership, then you can secure its future past the death of a key employee, partner, or co-owner with life insurance and an effective buy-sell agreement. When a partner dies, their ownership interest passes to the estate of the partner. The estate will stand in the shoes of the decedent. The estate will be entitled to have a valuation of the ownership interest and may - depending on the initial business set-up - demand payment for their percentage of the business.
http://businessinsure.about.com/od/lifeanddisability/qt/lifeinskeyemp.htm

3. What Every Business Executive Should Know About Insurance

Many companies view the business continuity planning professional's task as one of ensuring uninterrupted "operations," with the ultimate goal of protecting the organization from financial loss. It just so happens that the risk manager or insurance professional's goal is also to ensure a full financial recovery. It's apparent that these two professionals should be joined at the hip, yet most business continuity plans don't specifically detail the insurance claim adjustment process.
http://www.continuityinsights.com/articles/2005/08/what-every-business-executive-should-know-about-insurance

4. Business Interruption Insurance: What It Will -- and Won't -- Cover

Most standard business insurance policies cover only loss or damage to tangible items -- your equipment and inventory and your warehouse, office or store -- and not lost profits if your business cannot operate. To get business interruption coverage added to your business policy, you'll need to document your current net income. If your net profits are substantial, beware of low per-incident limits -- $30,000 per incident is common - because they might cap your coverage far below the amount you'd need.
http://www.entrepreneur.com/article/224982#

5. Directors and Officers Liability Insurance

Unlike general liability insurance -- which any organization that has a physical plant would be foolish not to have -- many nonprofits are uncertain whether they need D&O coverage. When a person becomes a board member of a nonprofit organization, she assumes a level of responsibility for the organization ("duty of care"), and exposes herself to claims for not running and managing it in a proper way. Whether or not your organization needs D&O insurance depends on what the likelihood is that one of your board members will be the target of such a claim.
http://www.npccny.org/info/oi2.htm

6. How to Properly Insure Your Business and Employees

There's risk in every endeavor and maybe none more so than that of an entrepreneur who may have mortgaged their home or emptied their life savings. To ensure that all your hard work isn't negated by some unforeseen circumstance, you need to secure adequate business insurance to protect you, your investment, your employees, and your bottom line. The main challenge is determining the best coverage.
http://www.inc.com/guides/201103/how-to-insure-your-business-and-employees.html