Major emergency ‘would put seven out of ten new firms out of business’

Lack of planning for the unexpected has left most firms in a vulnerable position, according to the government and the Association of British Insurers (ABI).

Seventy per cent of small firms would be forced out of business if they experienced a major emergency in their first year and more than two-thirds have no plans to deal with disasters like a flood or fire.

The Department for Business, Enterprise and Regulatory Reform, Defra and the ABI today held a seminar to promote the launch of the ABI’s Insurance for Small Businesses Guide.

Director general of the ABI Stephen Hadrill says that the floods last summer showed that many firms were without adequate insurance.

‘I urge all firms to plan for the unexpected-doing so will make the difference between survival and going under should the worst happen,’ he advises.

Minister of state for the Department for Business Pat McFadden says that the contribution small businesses make to the economy is ‘vital’ and generates ‘significant wealth for the country’.

According to the Environment Agency, businesses should use the agency’s postcode checker to see whether they live in an area prone to flooding.

Business owners should also use the agency’s template to develop a flood plan, it says.

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