Flood risk: Is your business adequately covered?

The UK has been battered by gale force winds and heavy rains for the second weekend in a row, as Storm Ciara and Storm Dennis caused widespread flooding and damage across parts of the UK, affecting more than 40,000 travellers by the disruption on air, rail and road networks, and resulting in power outages.

A flood is devastating if it happens at home, or to your business and it can have a huge impact both emotionally and financially.

For business owners, the potential for disruption to customers and staff, damage to stock and property, loss of power, disrupted supply chains, travel difficulties, and ongoing costs if the business has to be closed for repairs, can have a devastating impact on their ability to trade and therefore their bottom line.

While the government has increased spending on flood defences in England in recent years, about 5.4 million properties in England are at risk of flooding from rivers, the sea and surface water, with annual flood damage costing the country an estimated £1.1 billion.

However, while homeowners in flood-prone areas have benefited from the government-backed Flood Re scheme, a joint initiative with insurers aimed at making flood insurance more affordable, this does not cover businesses. And, when it comes to renewing their insurance policies, SMEs may well find the cost going up. In fact, according to a the Federation of Small Businesses, 75,000 SMEs could struggle to find affordable insurance.

Having the right level of insurance is absolutely vital for SME businesses in helping them get back on their feet and trading again should the worst happen. Small businesses should also consider taking out business interruption insurance, which covers loss of income after a flood, for example lost earnings because offices have closed or problems with deliveries if access routes are flooded.

If you are looking for insurance for your SME business, we are able to put you in touch with companies within our extensive network of contacts who will be able to assist. Contact Steve Govey or your usual Beavis Morgan Partner.

Further reading – Articles from our Beavis Morgan SME Adviser Series:

Insuring Your Business

Business Continuity Planning

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