Are you aware of the risks faced by your business? If not, how can you be sure that your business is properly protected? A risk management plan will help you find the right level of commercial insurance to protect your business and help it grow.
What is risk management?
Risk management is the practice of insuring your business against perceived threats. A risk is anything that can have a negative effect on your business. This includes cyber security threats, risks from staff members, or risks posed by new equipment.
Risk management starts with an assessment of the threats faced by your business. Common risks in 2020 included cyber incidents (cybercrime, IT failure, data breaches), Business interruption (including supply chain disruption and vulnerability), and changes in government legislation. (Statista)
Once you have evaluated the risks, a plan is formulated to mitigate potential threats. This limits damage from those risks or helps to avoid them altogether.
Do you need a risk management plan?
A risk management plan identifies the areas that could affect your business operations. A comprehensive plan will prepare for all eventualities and reduce any losses. For example, before installing a new software program, you should anticipate any risks that might come with it. From there you can put procedures in place that protect the business. In this case, restricting users’ administration capabilities and installing effective anti-virus software.
Businesses that do not have a risk management plan leave themselves exposed to threats that can cause substantial damage. Worryingly only 36% of organisations have a formal enterprise risk management program (quantivate.com). And 69% of executives are not confident that their current risk management practices will be enough to meet future needs.
A risk management plan allows a business to develop policies to protect itself. These policies help to avoid or mitigate any damage caused to the company.
Does risk management help with insurance prices?
Although most insurers don’t require you to have a risk management plan, it will help you find the best insurance policy.
The right commercial insurance policy protects your business from risks. However, you can only get the right level of cover by being aware of all the risks to begin with. This will protect you from nasty surprises should you ever need to make a claim.
If you do need to claim on your commercial insurance policy, a risk management plan will help. It will show that you have taken all necessary steps to protect yourself and limit the damage caused.
At the Bateman Group our commercial insurance experts can help you to find the insurance policy. We’ll find an insurer that covers the issues highlighted in your risk management plan. To get started call us now on 01926 495113.