Floods are dominating the news at the moment, but a major insurance company has warned of a contrasting danger with a report suggesting that 80% of businesses that suffer a major incident such as a fire fail within 18 months.
NFU Mutual, the UK’s leading rural insurer, has revealed that it paid out over £43 million in claims for commercial fires in 2012. Topping the list of claims with identified causes were fires caused by arson, electrical faults, electrical equipment and fires in commercial vehicles.
Commercial Development Manager Georgina Farndon explained that often it is not the loss of physical assets, such as premises and equipment, which devastate firms: it is the destruction of data.
"Firms need to have a business continuity plan and know how to deal with what happens after a fire. Many are simply not equipped to survive after a major catastrophe," she said. Re-building a business after a major fire can take months, if not years.
In addition to the damage to physical assets, the NFU suggests that many business owners neglect to consider how the business might continue to function whilst premises are repaired or rebuilt and new stock and machinery are purchased.
It has also reminded businesses that they are legally required to carry out an assessment of the risk of fire within their premises and the precautions they have in place, under the 2005 Regulatory Reform (Fire Safety) Order.
This includes a requirement to prepare and test an emergency plan, reviewing the means of escape including emergency lighting, and the testing of fire precautions and fire safety training.
From Paul Clarke, business writer for Croner