Weather risks to businesses highlighted
Commercial insurance
4th January 2010
Small and medium-sized companies that have not yet taken out comprehensive cover against potential damage caused by the weather are being urged to do so by Giles Insurance Brokers Ltd. Businesses can face severe disruption to their operations, in addition to steep costs for repairs, if they are struck by storms.
Recent severe flooding in Cumbria, Lancashire, the north-east of England, Scotland and Northern Ireland has caused problems for many firms operating in affected areas and a good insurance policy is key to getting up and running in the aftermath of such circumstances.
The Flood and Water Management Bill, announced in the Queen's Speech on November 18th, includes legislation that is intended to protect more properties in Britain from environmental threats. It has been welcomed by the acting director-general of the Association of British Insurers (ABI) Maggie Craig as representing "an overhaul in flood management". However, many firms' premises remain at risk and in recent comments made by ABI spokesman Malcolm Tarling, he noted the central role that has been played by flood cover in buildings and contents insurance since the early 1960s.
In order to provide support to small and medium-sized enterprises in Britain affected by recent heavy rains, the Federation of Small Businesses (FSB) recently established a new £500,000 Disaster Recovery Fund that provides interest-free loans of up to £5,000 to firms seeking to keep their operations going in the wake of a flood and help them pay for emergency repairs to premises. FSB national chairman John Wright stated that "all bodies, public and private, need to work together closely and effectively" in order to mitigate long-term damage to companies in affected areas.
However, such support is no substitute for a comprehensive insurance policy and effective business continuity planning. Both properties and vehicles can be affected by water damage and esure statistics indicate that over £35 million was paid out in 2007 by insurers as a result of harm caused to cars alone by heavy rains.
Recommendations from the ABI suggest that those impacted by stormy weather should contact their insurers as soon as possible in order to arrange alternative accommodation and catalogue damage to premises and assets. With further heavy rains expected in 2010, the organisation's director of general insurance and health Nick Starling noted: "The good news is that insurers are on hand to react quickly and start the drying out and restoration process as soon as possible."
According to Susan Young, group personal lines director at Giles: "With concerns growing about climate change and its effect on the British weather, even those homeowners who do not think their properties are under threat from flooding could be at risk. It is therefore, imperative that all households have comprehensive building and contents insurance in place to guard against damage caused by storms or other natural phenomena."
And it is not just floods that can damage premises over the winter, businesses should also guard against pipes bursting by leaving heating on a low level if premises are left empty over the festive break.
Giles can provide personal and business customers with access to some of the UK's biggest insurers and is one of the country's top insurance brokers. By searching the market, the company can offer customers a level of cover that best suits their individual requirements, including protection against weather damage. 
