Protect your business from these 4 key risk areas today
Comprehensive business insurance plans can protect you from cyber security threats and operational risks, says Discovery Insure
Building and running your own business is hard work. That’s why protecting it against key business risks is crucial.
While all businesses, both large and small, are unique, they are all exposed to similar risks. Careful planning and risk mitigation strategies are essential, especially for smaller, less-established businesses, which are often more exposed to risks and more vulnerable when recovering after a potential insurance event.
Here, Discovery Insure outlines the types of risks that business owners should keep top of mind when putting protective measures in place, sooner rather than later.
1. Cyber security risks
Online and mobile channels are ingrained in the way businesses are run today. This means it’s important to protect personal data against data breaches. Cybercriminal activity is becoming more frequent and their methods more sophisticated.
Identity theft, payment fraud, phishing scams and ransomware are becoming increasingly prevalent and can cause devastating disruptions to a business. It can be costly, affect consumer and shareholder trust, and damage a business’s reputation. At worst, it can even sink the ship.
Cyber security solutions, monitoring protocols and fraud detection tools are essential in protecting a business. This includes ensuring you have comprehensive business insurance that includes cyber cover.
2. Reputational risks
A good reputation has a direct impact on a business’s ability to grow and prosper. Customer complaints, product or service failures, negative press and lawsuits can adversely affect a business’s reputation. All of these influence reputation, which is further amplified by access to social media and its far-reaching capabilities. Something as small as a tweet can do significant reputational damage within a matter of hours.
Reputational management strategies are essential for monitoring both online and offline activity. This helps to better prepare responses, especially where there is a need to address concerns before they become major issues.
Another good mitigation tool is for your business to ensure it has sufficient business insurance cover, including assistance in developing a full response strategy to a crisis.
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3. Liability risks
This is the risk of the business becoming legally responsible to pay compensation to a third party for losses caused by the business owner or a representative of the business. Liability risks can include incidents such as employee or customer injuries at your premises, damage to property, and even failure to meet contractual obligations.
Liability risks can be costly to resolve, and can make a significant financial dent to your business. A good way to protect your business against such risks is having good liability cover that includes sound legal support.
4. Operational risks
Many things can disrupt business continuity and often occur unexpectedly. Fire or flood damage to a property and its contents and supply chain issues are examples of what can lead to significant business interruptions. In SA, business owners are also up against power cuts, which can result in costly challenges such as power surge events and damage to electric appliances.
Comprehensive business insurance plans can help protect against any resultant financial fallout, and can be a valuable investment in helping to minimise losses.
These and other risks are an unavoidable part of doing business, but proactive planning to mitigate the degree of their impact can be the difference between business success and failure.
This article was paid for by Discovery Insure.