Specialist DR Insurance Coverage

Sufficient insurance coverage is a symbiotic consideration when evaluating business risk analysis and subsequently developing a disaster recovery plan.

Having a DR plan in place which is demonstrably well structured and maintained can be considered risk mitigation by some insurance companies and consequently be a factor in reducing premiums. The underwriter may have concerns about easily discernible threats to business continuity and the construction and implementation of an effective recovery plan may alleviate some of these concerns and be critical in the decision to offer insurance.

The insurance policy may cover hardware and equipment replacement, data and records coverage, expenses and loss due to business downtime adjustment. The cost of insuring these areas will be assessed allowing financial officers to decide on the level of coverage needed.

Loss of Business Continuity

Insurance underwriters specializing in business downtime coverage can usually provide estimates of the costs incurred during any loss of business continuity due to an unforeseen outage. Investigations into incidents have usually revealed an underestimation on the part of business when it comes to anticipated losses. Experience demonstrates costs and damage sustained often exceed the expectations of most risk analysis.

Most business downtime policies include revenue lost during the disaster with cover extending to additional expenses incurred throughout the recovery period right up until normal business operations are restored. The point defined as normal business services needs to be agreed with the insurer and included in the policy to avoid any later disputes.

Following business downtime due to incident the insurance assessors will seek proof of loss. A public adjustor may be needed at a cost of a few percent of the recovered amount. Business needs to maintain asset records for a variety of reasons including loss adjustment following any loss of business continuity.

Telecom Coverage

Communications coverage often needs separate consideration given the complexity and cost of the systems involved and the implications of any telecoms downtime. Underwriters offer an array of Communications Indemnity Insurances covering systems and equipment, losses incurred during downtime and recovery, coverage against claims for SLA breaches, even compensation for advertising rendered ineffectual during business communications downtime.