Disaster prep: How to create an agency contingency plan

We’ve all seen the damage Mother Nature has caused in recent years. In the first half of 2023, the world endured $53 billion in global insured losses—the fourth-highest year on record and 46% above average since 2000.

Many of the same natural disasters that impact end-insureds can wreak havoc on the independent agencies that service an impacted community. Yet, according to a recent Big “I” report, only 24% of independent agencies have a written contingency plan to handle emergencies.

Disasters come in all sizes, from catastrophic storms to merely disruptive events like the power going out. Regardless of the scope, independent agencies require a solid contingency plan to turn to when business becomes anything but typical. And the best time to make this plan is today before the lights go out and you’re looking for a flashlight.

Shore up your agency

A contingency plan is like putting your oxygen mask on first in an airplane before helping someone else: If your agency is inoperable, you can’t help your clients recover from disaster.

Get your agency ready for anything:

• Document the essentials. Include emergency contact information, important employee medical information, and meetup locations. Ensure every employee knows what to do, where to go, and who to contact if an emergency happens.
• Assess your office for weakness. Your physical location may be susceptible to damage from a natural disaster, so inspecting now and making improvements will help you keep things running when the storm blows in.
• Provide medical training. Safety is a top priority, and danger is always present when disaster strikes. This is why it’s important to prepare employees for medical emergencies. The Red Cross will provide group training to help you achieve a safer workplace.

Ensure open lines of communication

For insurance agents, client communications are always important, but when the phone lines are down, they become critical.

• Communicate before disaster strikes. Your clients may be unaware that their property faces potential damage and could use a proper warning. Using tech-enabled automated client communications, agents can send messages to clients before catastrophic events to provide tips on reducing risks and protecting property to reassure them they are your agency’s priority.
• Create a client disaster communication strategy. Providing clients with “what to do next” information assures them you will be there when things go wrong. Inform clients about how to contact the agency when phone lines are down and let clients know how to handle potential claims, such as how to send pictures of damage and where to go when their property becomes uninhabitable.

What to do when the office is out of service

The pandemic taught us that work doesn’t have to happen at a desk in an office. To prepare for working in the field during a disaster, agencies can make preparations before critical work is done off-site.

• AMS in the field. Mobile-enabled agency management systems work anywhere with cell service. Mobile apps free agents to reach clients where they are and enable them to continue working when their offices have been affected by disaster.
• Agency self-service portals. Clients will likely require real-time access to their policy and claims information when situations get difficult, so maintaining an agency portal is important. While these portals are critical for clients who need their information now, they also provide another communication point—clients can send and receive messages through the portal.
• Cloud-based storage. Data stored solely on-site is at risk in a disaster. Cloud-based storage solutions solve access and security issues so data can be safely accessed anywhere there is a Wi-Fi connection. Secured, accessible data storage is essential when a physical office location sustains damage and agents must work in the field.

The independent insurance agency is always on the front line when things go from right to wrong. Agents support their clients on their very worst days and can often make the difference between inconvenience and catastrophe.

However, an agency cannot be there for clients if rendered disabled. Creating a solid contingency plan is critical before the next storm hits.

This blog appears on Vertafore's website: https://www.vertafore.com/resources/blog/disaster-prep-how-create-agency-contingency-plan

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