Lockton highlights business risks during Australia's storm season

Lockton has highlighted that the storm season in Australia, running from November to April, brings heightened risks for businesses due to extreme weather events such as cyclones, heavy rainfall, and severe winds.

These natural hazards can lead to significant disruptions, property damage, and financial strain.

Damian Lawrence, national manager complex claims and forensic services at Lockton, has emphasised the importance of taking a proactive approach to safeguard operations and manage potential insurance claims effectively.

Staying alert to weather changes 

Lawrence said staying informed about weather conditions is critical to managing storm risks. Insurers and brokers should advise their business clients to regularly check the Bureau of Meteorology’s forecasts and severe weather warnings and sign up for notifications from local emergency services and news channels to stay informed about imminent threats.

Reviewing emergency preparedness plans 

Effective emergency plans can help reduce the impact of severe weather on business operations. Recommendations include:

• regularly updating disaster recovery and business continuity plans
• ensuring employees understand the steps to take during emergencies, including safety protocols and contact points
• designating team members for tasks such as coordinating safety measures, managing emergency kits, and overseeing recovery efforts
• checking that first aid kits, food, water, flashlights, batteries, and other emergency equipment are ready and accessible

Securing premises and assets 

Physical preparations can significantly reduce the risk of damage to property and inventory. Lawrence said key actions include:

• securing or bringing indoors loose items such as signage, furniture, and equipment
• installing protective measures for windows and doors, such as shutters or plywood coverings, and using sandbags if flooding is a risk
• inspecting roofs and clean gutters to prevent water blockages
• relocating or elevating critical machinery and inventory to limit exposure to potential damage

Reviewing insurance coverage and financial preparedness 

Understanding the scope of insurance coverage is essential for businesses ahead of the storm season. Therefore, insurers and brokers should help their clients:

• review property and business interruption insurance to clarify coverage and support available for storm-related damages
• secure critical business records, including financial systems and inventory data, using cloud services or off-site storage
• develop a cash flow plan to maintain operations during disruptions
• track expenses associated with storm preparations and potential recovery efforts

Post-storm actions 

In the event of storm damage, a structured approach to recovery can help businesses restore operations efficiently: Insurers and brokers should advise their clients to:

• inspect the property and take detailed notes and photographs of all affected items
• notify insurance brokers and claims representatives promptly. Brokers can guide businesses through the claims process and ensure policies are maximised
• begin immediate safety repairs to stabilise the site and plan for longer-term restoration

Lawrence added that businesses must maintain comprehensive records of all expenditures, including staff time and contractor fees, in a dedicated storm-related account.