Creating a BC plan fit for a more hazardous future

Following the Parima conference in Taiwan and another year of record storm-related losses, BELFOR’s Elvir Kolak highlights the importance of good preparation.

Companies in Asia-Pacific face an ever-growing exposure to catastrophic property damage as a result of two trends – a lack of resilience and an increase in natural disasters and extreme weather.

This is especially true in the small and medium enterprises (SME) sector which accounts for 97% of all businesses in the region and is key driver of economic growth. However, insurance adoption among SMEs is poor when compared to other regions.

For example, Typhoon Yagi, caused $12bn of economic loss across mainland China in September but insured losses were estimated at just $500m in the following weeks. According to broker Marsh, just 155 of the 71 million SMEs in the region, only 15% are insured against national catastrophes, despite the rising risk of such events as a result of climate change and other phenomenon. “Only a handful of businesses have the ability to recover from a major risk event,” states the Marsh report.

Recovery is key. The Allianz Barometer has noted that natural catastrophe is now the cause of business interruption businesses fear the most (44% of responses) after cyber incidents.

Business interruption is a major issue for Asia-Pacific firms thanks to the interconnectedness of global supply chains, particularly manufacturing centres that export goods to overseas consumers. For example, research from Schroders and Cornell University also found that extreme heat and flooding puts the largest fashion manufacturing countries, such as Bangladesh, Cambodia, Pakistan and Vietnam, at risk of an estimated $65bn in export losses by 2030.

And while insurance will, eventually, provide compensation for the physical damage and, in some cases, for business interruption, it will not restore the lost customers that could ultimately prove fatal for a business.

This is where a disaster recovery company such as BELFOR comes in. Since our inception in 1993, BELFOR Asia has helped a diverse range of industries – from mining and metals, to scientific, medical and semiconductor, and most industries in-between – recover buildings, machinery and all types of equipment, to bring them back to business in the shortest possible time.

There are typically three stages to the recovery process. The first step is an onsite inspection to ascertain the extent of the damage. Standardised equipment can then be brought in to begin the recovery. The final stage is the restoration of the facility to full operational activity.

Some companies may rely on their insurers to manage the restoration process or even look to employ construction or cleaning companies or emergency service providers, following an event. However, there are essential benefits that come from employing a disaster recovery and restoration specialist such as BELFOR.

The main benefit is the expertise and experience that BELFOR can provide through the engineers and risk specialists employed directly by the company as well as extensive network of specialist suppliers and contractors. This means that BELFOR can respond quickly and in a coordinated way rather than leaving the client to manage the multiple processes involved in a disaster recovery programme.

Another benefit is time. In the event of a natural disaster, there will be numerous companies all looking for help and restoration. Even when your insurance policy includes restoration services, you may find yourself in a queue along with all the other clients of that carrier.

If you have already partnered with a restoration company such as BELFOR, this puts you to the very front of the queue. BELFOR has a particular service designed especially for such disasters when time is of the essence and the demand for valuable but limited resources is almost overwhelming.

BELFOR’s RED ALERT® service is structured to work alongside companies’ response plans and emergency procedures so that recovery can be more rapid and effective, and that any gaps in business continuity plans can be minimised. It also secures access to critical resources during a company’s hour of need.

• BELFOR® covers entire supply chains across all continents.
• RED ALERT® clients receive exclusive access to a dedicated hotline.
• RED ALERT® clients enjoy priority status. In the event of a national disaster and increased demand, RED ALERT® clients skip the line and get served first.
• No two businesses or even industries are alike. This is why BELFOR experts’ bring in specialist knowledge and experience of all businesses, being able to customise their services before, during and after a business interruption.
• By their nature, emergencies create uncertainty. RED ALERT® supports companies in defining their appropriate level of service, which corresponds to their prevention planning, making their business more resilient.
• The first hours following a disaster are crucial. Step-by-step protocols tailored to the client’s needs reduce the impact of any business interruption. That way, companies are ideally prepared for both minor incidents and worst-case scenarios.