Disaster Recovery Journal

After you finish your lemonade, you walk home with two thoughts: BII needs to be incorporated or considered by business continuity professionals to help enhance recovery strategies; these kids make the worst lemonade you have ever tasted.

While you can’t help them improve the lemonade, you start to think about your business continuity program (BCP) and the synergies between BII and BC. The enhanced strategies, the ability to pay employee wages during a long outage, and the ability to use consultants during the recovery operations are all tangible benefits of learning who in the company is responsible for the BII coverage. You start to think of ways your BCP can help during the process of determining insurance (including BII) coverage.

This will definitely help in evangelizing the business continuity message in another tower in the company. The department that works on your insurance policy should have asked, “What calamities do we need to insure against?” If they had been involved in your BIA, they would have learned that the BCP conducts risk assessments across the company. It would behoove the insurance group to look at the identified risks to ensure that there is coverage or consideration for the risk. It would not be the best business decision to have recovery plans in place for a natural risk ( earthquakes for example) and the property insurance not cover that risk. The output of the BIA would also be useful in determining the BII value for each site that the company has on the policy.

An insurance executive has offered that you can ask yourself the following: “Do my BC and insurance programs support the financial and operational goals of my company?”

BII will usually only pay claims if the loss is caused by an insured peril. There could be multiple instances that would cause the business to be interrupted and not be covered by the BII. Some common perils would be fire, tornadoes, hurricanes, floods, and earthquakes. If these natural threats are a high risk on your risk assessment, the insurance group should have them on the policy.

Terrorist activity, pandemic conditions, toxic gas releases, network breaches, and server outages would not be covered by the BII coverage on your property insurance. However, special insurance coverage is available for network breach incidents. This could be beneficial if a lot of sensitive data is stored by your company. Terrorism coverage and political risk coverage are available in certain locations/countries.

The BIA would also be helpful to the insurance group if the company had critical suppliers identified during the BIA. If the company was dependant on a sole source supplier that had a disruption, your company could experience an interruption. A contingent business income rider would protect your company and customers if the sole source supplier could not deliver.

NOTE: A sole source supplier is a supplier that produces a unique product that is not produced by another source. A single source supplier would be different in the sense that another supplier exists for the product, but only one supplier is used to procure the product.

After you finished your BIA, you started to develop your business continuity strategies. Before you knew insurance could cover some costs for expensive recovery solutions, you expended

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