BUSINESS CONTINUITY PLANNING
Preparation is everything
Tony Gimple, managing director at Crisis Survivor, examines the regulatory and
whole risk presentation to both
business benefits of BCPs
clients and underwriters. This
should significantly mitigate the
risk of under-insurance,
T
hough having a business
Financial Services Act SYSC repudiations, and both client and
continuity plan (BCP) is part
3.2.19G). insurer misunderstanding.
of brokers regulatory
In the broader market, Similarly, loss adjusters will be
obligation, the requirement can
company directors are beginning better placed to recommend
actually works to their benefit
to face the same issues with the claims settlement and mitigate
and be used to generate business
introduction of the Companies Act payouts when a BCP/risk analysis
from both new and existing
2006; which states that directors already exists.
clients while improving the
may fail in their duty of care if Both regulation and good
compliance and commercial
they do not take the right commercial practice call for
position.
decisions to ensure that they demands and needs analysis.
Business continuity planning
“promote the success of the Using BCPs to augment existing
offers benefits in two main ways:
company for the members
Tony Gimple
risk analysis processes offers
benefit”. Managing Director substantial business benefits:
● By having a BCP a firm will
be better protected from
This means that to be
Crisis Survivor
disruption and so more
compliant with Act, directors will ● Fact-finding will be more
compliant
have to at least consider:
company maintaining a
comprehensive through
(a) the likely consequences
reputation for high standards of
clients direct involvement in
● The more creative approach
of any decision in the long-term
business conduct; and
the risk
is to use a BCP service to
(b) the interests of the
(f) the need to act fairly as
management/transfer
differentiate a business from
companys employees
between the members of the
process as they compile their
competitors and further win
(c) the need to foster the
company.
BCP
your clients trust as a
companys business relationships
professional adviser.
with suppliers, customers and
All of which form part of the ● The augmented process will
others
business continuity planning demonstrate to the client
Insurance brokers are
(d) the impact of the
process and so ensuring directors that the broker is exercising
required to have a BCP in place if
companys operations on the
compliance and the long-term all due skill and diligence in
they are to maintain their
community and the environment
survival, if not success, of the discharging his duties
professional status, (see the
(e) the desirability of the
business. This alone should reduce
claims under D&O and
● With the additional
professional indemnity, and
information gathered during
trigger disputes with business
the BCP process, brokers will
interruption or increased costs of
be able to present better-
working extensions, especially
understood and better-
where there has been no material
documented risks to
damage to own premises.
underwriters, which often
The Law Commission report
reduces both the frequency
on insurance contract law will
and severity of future claims
reduce the inherent risks and
by the early adoption of
public dissatisfaction with the
better risk management and
current business model, with the
claims mitigation policies,
review having had profound
thus improving the quality of
implications for the ways in which
the risk pool
brokers operate.
At its heart is objective and
● Professional Indemnity
holistic risk analysis, leading to
insurers should also be able
16 Insurance Brokers’ Monthly
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