Business Continuity Plan - Must-Haves for Every Business Owner

Business Continuity Plan - Must-Haves for Every Business Owner

Next Insurance Staff
By Next Insurance Staff
Sep 5, 2019
5 min read

When starting a small business, the old adage "hope for the best, prepare for the worst" is more relevant than ever. To succeed, you must have a positive attitude and believe yourself capable of overcoming all small business challenges that may come your way. At the same time, you need to make sure your business is prepared for all eventualities that may affect its ability to continue running.

It's not just a matter of responding to unlikely disasters. It's only natural for a small business owner to worry about unexpected events that might harm their business - and that worry can be draining and distracting. Being prepared allows you to channel energy away from worrying and toward running your business and helping it thrive.

What Is a Business Continuity Plan?

Business continuity is the ability of a business to continue providing service to its customers even in challenging circumstances. So a business continuity plan provides instructions and guidelines for preventing loss of business in the event of an unexpected disruption.

Events that could throw a wrench in the works might include:

  • Illness, injury or death of key personnel
  • Natural disasters, such as fires, hurricanes, tornadoes, earthquakes or floods
  • Security emergencies, such as terror attacks and active shooter events
  • Accidents that damage business property
  • Sabotage, such as cyber attacks and hacker activity
  • Damage to infrastructure, such as power, communication or transportation services

Businesses with solid continuity plans are much more likely to survive incidents like these.

Creating a Business Continuity Plan

So how do you draw up a plan for your business that will help keep it resilient in the face of unexpected incidents?

The business continuity planning process involves assessing the potential risks, identifying the factors most crucial to continued operation of your business, and finding contingencies for those crucial elements. It also involves implementing preventative measures that will help minimize the damage if something does go wrong.

Business Continuity Risk Assessment

First, make a list of all the possible threats to your business's smooth operation. Points to consider:

  • Do you live in an area that is prone to a certain type of natural disaster, e.g. hurricanes, earthquakes or tornados?
  • How much does your business depend on access to transportation and utilities, such as telecommunications, electricity, and running water?
  • What will happen if your office or key equipment is damaged, destroyed or inaccessible?
  • How much does your business depend on information security? What might happen if someone hacked into your system?
  • Who are your key personnel and what functions do they fill in your business?

Next to each risk, write down a few possible solutions or contingency plans. For example, if your Internet service stops working, are you able to temporarily move somewhere else that has Internet access? If one of your key employees suddenly falls ill, is there someone in the company who can stand in for them until you find a replacement?

Remember: prevention is better than cure. Your business continuity plan should include preventative measures, not only how to respond in an incident. For example, if your company handles sensitive material from your clients, you should have a strong information protection system in place that will prevent hacking and cyber attacks. If you live in an area that is prone to earthquakes, choose an office space that meets the local earthquake safety regulations, and plan your office space ensuring that furniture and sensitive items are properly secured.

Testing Business Continuity Strategy

The only way to be sure the business continuity plan is thorough enough is to test it. You can test it in a number of ways:


The simplest way is to read through your plan with your staff and try to locate any weaknesses or points you may have forgotten to consider. This is more of a review than a test, but at least it ensures that all your employees are aware of what to do.


A walk-through is a more thorough way to test the plan. Pick a specific disaster scenario and ask your employees to verbally walk through that scenario. How would they know that something was wrong, and how would they respond? You can go through multiple scenarios, keeping an eye out for anything you may have missed.


This is the most foolproof way to test the plan, but it may be impractical for some small businesses. Have your staff enact the scenario and practice their responses - just like a fire drill.

Other Important Steps to Minimize Risk to Your Business

Business continuity plans are not the only kind of business risk management you should take into consideration. Another important component to keeping your business protected is business insurance. Insurance is one way of making sure your business won't be financially ruined in the scenarios mentioned above. It can help pay for damages, replace equipment and protect your business against costly lawsuits.

Thorough and well-written contracts are also important, because they prevent misunderstandings that could lead to financial or legal disputes.

It's not easy or pleasant to think about all the things that might go wrong with your business, but having a solid plan in place gives you the peace of mind you need to focus on the good stuff: making your customers happy and growing your business.

For more information on how insurance can help protect your business, check out our Business Insurance page.

Business Continuity Plan - Must-Haves for Every Business Owner


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