Australia's storm season (opens a new window) typically runs from November to April. This can bring severe weather, including cyclones, supercells, heavy rains, and intense winds. Natural hazards continue to increase in frequency, intensity and destructiveness, constantly threatening the resilience of organisations.
Business leaders should understand how to minimise disruptions, protect assets and manage and respond to an insurance claim if damage occurs. Here are some valuable steps and pointers to prepare before a storm to help minimise damage and disruption. We also share what to expect in the event damage does occur:
Stay informed with weather alerts
Staying informed is the first line of defence against unpredictable weather.
Monitor weather updates: check weather forecasts and severe warnings regularly on the Bureau of Meteorology (opens a new window) website or app.
Sign up for alerts: subscribe to local emergency services alerts and follow local news for updates.
Review and update emergency response plans
Review disaster recovery plans, risk management plans or business continuity (opens a new window) plans if available. If these are not available, ensure that basic disaster plans and processes are at least discussed and documented:
Review disaster plans: this will refresh employees' memories and allow updates before an event.
Communicate plans with staff: this will help to ensure staff members know what to do, who to speak to and how to stay safe.Assign roles: key coordination roles should be assigned to staff members in advance, including a contact to ensure staff and customer safety during a storm. The plans should also include people to check and test safety kits and mitigation packs. Finally, it should include those responsible for coordinating post-incident recovery and communications.
Check safety kits and emergency supplies: comprehensive first aid kit, water, food, and necessary medications are sourced and available. In addition, ensure flashlights, batteries, portable radios, communication devices, and tools are available.
Check/test mitigation measures including: ensuring communication plans are in place, testing generators/alternative power sources, checking fuel reserves, and planning to move essential equipment and stock to a safer location.
Secure your property/assets
A couple of days before the storm hits, it is essential to minimise the likely damage by undertaking the following regarding physical assets:
Secure outdoor items: bring in or secure loose items like signage, furniture, and equipment.
Trim trees and branches: trim trees and branches on the premises to minimise the risk of damage.Reinforce windows and doors: install shutters or use plywood to protect windows. Make sure doors are sturdy and have strong hinges. Use sandbags if near creeks, rivers, or coastal areas.
Inspect the roof and gutters: check for loose tiles and clean gutters (opens a new window) to prevent water damage from blockages.
Protect critical plant equipment and stock: power off all items where possible. Raise or cover them. If you can, move them to a safe location.
Review insurance and finances
Insurance: review your Property Insurance (opens a new window) and Business Interruption policy. Understand what is in place and what support is available if there is major damage.
Backup data: If not done regularly, back up critical systems and data. Use a secure cloud service or take them off-site if no cloud service is used. This should include computerised inventory and finance systems.
Essential documents: review and make copies of critical documents such as business registration paperwork, property deeds, and key contracts.
Financial preparedness: consider a cash flow plan. This ensures funds are available to cover fixed and semi-variable costs when income may drop. Establish the cash flow tolerance period. This data will be helpful concerning the timing of insurance payments in the event of damage.
Financial support systems: ensure stock inventory systems are up to date. Know the volume and value of stock before a potential storm. Also, ensure the latest monthly financial data is available. This includes the historical management profit and loss statements and income and expense reports for at least 12 months. If done, budgets and forecasts for the coming months should also be available. Set up a storm account within the accounting system to capture and record all costs incurred related to the storm.
After the storm
If the worst occurs and the storm damages the property and business, then the following will help in the recovery and progress:
Assess damage: once safe to do so, thoroughly assess your property and document any damage. Take pictures of damaged items, especially those that must be disposed of quickly. This is for perishable stock, health, or hazardous material reasons, or to ensure property access. Do this before insurers or their representatives attend. Document all items, even if of low value. Divide them into categories such as buildings and fit-out, IT equipment, plant and machinery, vehicles, content and furniture, stock, and consumables. Also, split the process by room or area. This lets several people work on it at once in small, manageable sections.
Contact your insurance broker and insurers: notify your Lockton broker or Lockton claims team to start the claims process as soon as possible. They can verify coverage and advise if claims help is available. If needed, claims preparation is something underwriters may fund.
Clean-up and emergency repairs: follow safety guidelines for clean-up and, if required, organise for immediate safe repairs to take place, if possible, especially where access to the premises means insurers and loss adjusters are unable to attend quickly.
Make plans for major repairs and replacement of damaged items: contact known builders and suppliers of key plant and equipment or contents items to determine the availability of replacement items or start dates for works. Also, determine likely repair or replacement costs and, where possible, obtain a detailed scope or quote for these works.
Commence documenting the claim: record all quotes and invoices related to the damage into a manual spreadsheet. Save the invoices and quotes into a folder or the storm account in the accounting system. To help the claim process, include all costs, no matter how small. Also, when staff work on clean-up and repairs, keep records of their hours, including weekends and after-hours.
By taking these steps, you can help to ensure your business is ready for Australia's storm season. This will aid recovery and claims after any damage or interruption.
Remember, if you have major damage and need to claim, please contact your Lockton broker or the Lockton claims team. They will help you file your claim with your insurer and extract the best possible value from your policy.
The contents of this publication are provided for general information only. Lockton arranges the insurance and is not the insurer. While the content contributors have taken reasonable care in compiling the information presented, we do not warrant that the information is correct. It is not intended to be interpreted as advice on which you should rely and may not necessarily be suitable for you. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication.
