We’ve all seen the pictures of houses, buildings and areas destroyed by massive earthquakes, and we’ve heard the news reports suggesting that Vancouver is due for the big one. You may think your business customers are prepared, but are they really?
As a global insurer RSA has seen our customers through a number of catastrophic events worldwide, including the massive 8.8 earthquake in Chile in 2010, and the unprecedented flooding in Calgary and Toronto earlier this year. Along the way, we’ve learned what it takes to keep a business afloat and to get customers back up and running as quickly and effectively as possible.
There are numerous similarities between the west coast of Chile and the west coast of Canada. Both are on the Pacific rim of fire and are exposed to destructive mega-thrust earthquakes; both have heavily regulated building codes; both have similar natural resources, and population densities. In 2010, following what was the 7th largest earthquake ever on record, we were the largest insurer in Chile. As a global organization, we learned valuable lessons about what business continuity planning really means and are sharing that knowledge with customers wherever possible.
We’ve all read the government literature that says Canadians should be prepared to go it alone for the first 72 hours, but businesses really need to be prepared to survive for a lot longer. Take a holistic approach: how will the business cope if its supply chain and business partners are all in the same boat? Consider the supply chain – do suppliers have national or international resources they can rely on? If the customer’s offices are not operational, can they move work to other locations? How will they access business critical data? How will they communicate with employees, business partners and customers? Does the insurance company have contractors, adjusters and recovery experts in other locations it can pull in in the event of an earthquake? These are the things that will mean the difference between getting help quickly, and being at the end of the line because there are not an infinite amount of contractors and resources in British Columbia. (continued.)
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The other key learning we took from both the earthquake and this summer’s floods in Alberta and Ontario is that businesses will require more resources than they would expect to remain operational. When planning, it’s critical to think about cash flow and capital, how to ensure employees’ safety if they are stuck at work, and how they’ll communicate – assume airports with be closed, bridges will be inaccessible and infrastructure will be compromised.
And here’s the best piece of advice for business owners: when planning, imagine the worst case scenario. Then consider something worse and plan for that. While we all hope we’re developing plans we never have to use, it’s imperative that we have thought through the possibilities and are as ready as can be. For more than 300 years RSA has been helping customers plan and prepare so that when disaster strikes, we can get customers and businesses back up and running as quickly as possible.
The author Steve Yendall is Vice President of Western Region at RSA Insurance, a leading home, car and business insurer. Steve is delivering a keynote speech on Oct. 17 on how businesses can prepare for an earthquake, including best practices on business continuity planning and how global events impact the cost and availability of earthquake insurance. For more information, click here.
