Small claims are easily dealt with. But what if it’s a major claim that’s crucial to the survival of your reputation or your business? Say your premises are severely hit by fire, flood or storm damage? It could be your IT infrastructure is compromised by a cyber attack or critical business information stolen or wiped by an unhappy employee. It could be the sudden loss of key customer contracts that leave your business dangerously exposed, product fault or contamination - even a death or serious injury in the workplace.

Some organisations may never entirely recover from such an event. Loyalty and sympathy only go so far before you face losing orders, contracts, profits, people and jobs or worse. Let’s look at the figures: in 2015, 73% of small businesses lacked a disaster recovery plan, as did 32% of mid-range organisations and 25% of corporates.*

KEEP CALM & CALL YOUR BROKER: HOW TO RESPOND AFTER A MAJOR INCIDENT

Sudden unforeseen shocks can knock your business for six. We outline how best to deploy your insurance at the moment of truth …

The stress of moving from incident to recompense and recovery can be intense. It pays to be prepared: as part of ongoing risk management, ensure you know how to activate the claims process quickly and confidently – plus understand what your responsibilities are as the claim progresses. The final outcome will be governed by how you work with your broker and your insurers. Here we outline the liaison and action steps that will draw the sting when you start picking up the pieces.

Follow our step-by-step guide and you won’t go far wrong …

* Source: Tandem Systems / Blog: ‘73% of UK SMEs who lack a disaster recovery plan are at risk’ by Michelle Ramsbottom / 7 October 2015. Research by Databarracks.

KEEP CALM AND MAKE THE CLAIM: HOW TO RESPOND AFTER A MAJOR INCIDENT.

Anticipating the claim …Misfortune can strike randomly so be organised in advance.

• As part of your risk management strategy, it’s good continuity practice to appoint a loss management team made up of responsible individuals drawn from all key operational areas – for instance finance, IT, operations and commercial.

• In the event of a major incident, you can deploy this team to help limit losses and make sure no stone is left unturned handling the event and helping progress a claim.

• Keep all your policy and risk management documents clearly filed and within easy reach – including copies at home for your trusted individuals on the loss management team.

• Keep your Insurers and broker’s numbers handy – the claims hotline on speed dial is a good start

• Know which number to call if you need help out-of-hours• Brief your loss management team and ensure they know the

immediate response processes: what to do and who to call.

Above all, keep calm …Whatever the event, how you react sets the tone for those crucial next few weeks or months. The crucial relationship is the one with your broker. Aside from helping you design the right basket of insurances in the first place, the flip side of the broker’s job is to guide you successfully and efficiently through every step of the claims process in a supportive and effective way.

Your first response …• Think clearly: if it’s an emergency involving serious accident,

damage or injury, call the Emergency Services immediately. Help with the incident reporting and ask for copies for both your business and your insurers – they will be vital to processing the resultant claim. Ensure you report any criminal losses to the police.

• Document the situation in as much detail as you reasonably can across all areas that appear to be affected – whether premises, people, third parties or finances – and call your broker. Take pictures too if you can; better to have too much evidence than too little.

• Don’t delay making that initial call to your broker – it just slows up the claims process and means you may wait longer to receive the funds you may urgently need.

• Your broker will advise you appropriately about the claims process, the paperwork you will need to complete and the evidence and verification documentation you will need to prepare.

• Ask your broker what action you need to take to minimise any further losses or damage. If this involves emergency repair work, ensure it is approved by your insurers and do check whether or not you need to use insurer-approved professionals.

• Your insurance company will usually appoint a loss adjuster to investigate, assess and verify your claim and work with your broker and you towards a speedy solution. The more pertinent information you make available to the loss adjuster, the faster they can process the claim.

KEEP CALM AND MAKE THE CLAIM: HOW TO RESPOND AFTER A MAJOR INCIDENT.

Good planning helps cut the chances of a major incident and claim …With thoughtful preparation, most claims can either be prevented or their frequency drastically cut - all part of sound risk management and clear communication with your people. Your safety protocols should cover all that your people do or handle that put your business at risk should an incident occur. Ensure that the processes you put in place are well communicated and thoroughly understood by your people.

Here are some useful tips to help you lessen the chance of an incident … and manage things better if there is one …

• Response: create a loss management team drawn from all parts of the business – it will enable you to react faster and limit the impact of an incident.

• Fire: ensure all protections are in good working order and regularly tested plus make sure all know the evacuation procedures.

• Health & Safety: follow the regulations for the safe use of equipment, machinery and heavy plant in the workplace. Compliance is key.

• Driving: ensure clear guidance for the use all organisation vehicles both on-site and off.

• Finance: protect your financial, commercial and/or intellectual property data and ensure you have robust processes for the security and use of your organisations funds.

• Storage: make sure you standardise how people handle and store hazardous chemicals.

• Contamination: follow all regulatory stipulations in food preparation areas.

• Site security: think about CCTV and have a standardised reporting system for all incidents.

Tackling a major event over the longer term …• Let your loss management team keep working with your broker,

insurer and any other relevant third parties (for instance, the Health & Safety Executive), responding as required.

• Your broker is there to fight your corner with the insurance company loss adjuster but you may want to consider appointing your own adjuster for a useful second opinion that enables you to pressure-test the response of your insurance company (at your cost).

• If it’s a financial claim, the loss adjuster will likely appoint forensic accountants to investigate. Speak to your broker – there may be grounds to appoint your own, to check that your insurer responds fully and fairly. Again this would be at your own cost.

• Ensure your claim is for the full scale of the loss – repairs, cleaning, replacement and also loss of earnings if you are covered for the latter.

• You may need interim payments: if so, inform your broker at the earliest possible opportunity.

• Review your claims experience with your broker: this will help you identify any changes you might need to your existing cover or to your incident response procedures.

What to do and what not to do when making the claim …• DO notify your broker immediately (and the Emergency Services

if applicable).• DO record accurate information about the nature of the incident

as quickly as you can.• DO work closely and readily with your broker; full disclosure

is key.• DO respond promptly to all questions from your

insurance company.• NEVER underinsure your business or invalidate your insurance by

not complying with the terms and conditions.• NEVER make repairs without your insurer’s approval.• NEVER underestimate the full costs of the loss – your broker will

help you get it right.• NEVER knowlingly inflate claims or make claims for where you

have no cover.

KEEP CALM AND MAKE THE CLAIM: HOW TO RESPOND AFTER A MAJOR INCIDENT.

IMPORTANT INFORMATION:

The opinions and views expressed in the above articles are those of the author only and are for guidance purposes only. The authors disclaim any liability for reliance upon those opinions and would encourage readers to rely upon more than one source before making a decision based on the information

Arthur J. Gallagher Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered Office: Spectrum Building, 7th Floor, 55, Blythswood Street, Glasgow, G2 7AT. Registered in Scotland. Company Number: SC108909.

FP603-2016. exp 9/8/17.

T: 0800 612 2278E: ukenquiries@ajg.comwww.ajginternational.com

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About Arthur J. GallagherFounded in 1927, Arthur J. Gallagher & Co. has become one of the largest, most successful insurance broking and risk management companies in the world. With extraordinary reach internationally, our parent group employs over 21,500 people and provides services in more than 150 countries. Outside the US we are known as Arthur J. Gallagher and wherever there is an issue of risk, we’re there for our clients. We are a business without barriers – working together to create solutions that drive value and competitive advantage for our clients. Our people, our depth of technical knowledge and our global reach will deliver unrivalled advice and coverage expertise.

Arthur J. Gallagher: we like to keep it simple …For us it’s a point of professional pride that when you need help the most, we’re there to take the strain. It’s particularly true for major claims which are almost universally stressful. Good brokers don’t just specify cover; we are your go-to resource who will proactively take you through every step of the claim and ensure you have fair, thorough and expedient representation at insurer level. Remember: thoughtful planning ahead and well-designed business interruption cover will reduce the chances - and impact - of an incident and enable you to navigate the claims process confidently.

Having a sound plan to cope with a major incident is arguably the most important insurance policy you will ever put in place and should cover all critical systems. The objective is to move your firm from disrupted status towards a return to normal operations as the claim is processed. Don’t just plan for extremes, but also for other emergency situations that are far more likely: loss of utilities, equipment failure or disruption within your supply chain.

• There’s no specific law requiring employers to have a business continuity plan, although the Financial Conduct Authority does require regulated financial businesses to have one. For other types of organisation, remember that insurers are frequently making risk improvement recommendations to the effect that you should have one written and tested.

• A business continuity plan is not just about protecting your organisation against what might happen, it makes good HR sense too. From a Health & Safety perspective, it’s safe to assume that employees will ask themselves at some point whether or not their employer has taken all reasonable steps to protect them from serious workplace incidents.

Thorough contingency planning should also cover the following areas …

• Scenarios: identify the likely threats and the consequences if the worst happens – like loss of power, loss of IT or loss of office due to flash flood or fire. However, if your office or site is in the shadow of a refinery, nuclear power station or on a known flood plain for example, then planning for worst case should be a priority.

• People: identify the key people you rely on and be able to contact them in the event of a crisis: this loss management team should be as large as needed but as small as possible.

• Premises: can you share space with a nearby firm as a contingency? If so, make the arrangement reciprocal. Do you need a pre-agreed arrangement with a disaster recovery centre?

• Tasks: allocate emergency tasks – who calls the insurer and who alerts customers?

• Flexibility: indentify those who can work from home – they’ll help relieve the pressure.

• Supply chain: document your critical vendors, contractors, partners, suppliers and customers.

• Kit: document your critical equipment or plant – and identify contingency replacements.

• Back-ups: back-up your computer data and systems; store them securely off-site.

• Staying in touch: contingency communications – like re-routed telephony or a wholesale switch to mobiles.