Thanks to Covid-19, business revenue has taken a hit the past couple of years. And it will continue to be a source of stress in this post-Covid world.
While some businesses were able to benefit from government assistance programs during Covid, not all did. Plus, these programs were, at best, a “stop-gap” measure that often fell short of the true need. This left many business owners in financial peril.
If a business had a crystal ball, it could have purchased an insurance policy to protect its business income from Covid. But who could have predicted that we would have a pandemic in 2020? And if the business had purchased a business income policy, would it have been enough to help the business survive Covid? We will never know. But what we have learned is that a business must plan for the future to protect its business and its employees.
So Now What?
The answer to this question lies in properly identifying business risk before it occurs. Often a business doesn’t review its commercial policy until after an issue arises, hoping that the policy includes business interruption coverage for income replacement.
However, even if a policy covers fire, wind, theft, crime, and vandalism, it may not be enough. Hazards may only scratch the surface of the true risks that a business faces.
Time to Dig Deep
A comprehensive risk management strategy must take into consideration the enterprise risks that a business faces. It is incumbent upon a business to identify how losses may occur.
Previously, we wrote about the typical hazards facing business owners. This list should be expanded to include other risks that can affect the business’s revenue such as:
- Supply Chain Disruption
- Event Cancellation
- Pandemic Coverages
- Legislative Change
- Loss of Contract
- Loss of Key Supplier
- Loss of Key Person
- Cyber Protection
There are many ways in which a policy can measure lost revenue. It can be stated as a fixed dollar amount or by using a “Look-Back Period” based on either the previous quarter or annual earnings. A business needs professional expertise in order to make sure that it gets the right policy to fit its needs. That is where RMC comes in.
Comprehensive Risk Review
At RMC, we believe in a holistic approach to business planning. That is why we always start our clients with a comprehensive review of the business’s risks. This free risk review looks at a business’s existing insurance coverages (including property and casualty, health insurance, and other employee benefits) and policy procedures to assess the business’s current risk management profile. RMC will identify those areas of risk that are well positioned and make recommendations for those areas that may need improvement. RMC will help the business owner better understand what they have in place and what they need.
RMC Group is uniquely positioned to offer highly competitive pricing for all insurance coverages. In addition, where appropriate, we can help the business establish a Captive Insurance Company enables the business to cover those risks better served outside the traditional marketplace and to create a profit center.
To learn more about our free comprehensive review and how RMC can help you protect against risk, contact us today at 239-298-8210 or rmc@rmcgp.com.
