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FIORITO ON INSURANCE Hurricane Season Is Here: How Prepared Is Your Hospitality Business?

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rom flood waters, property damage, power loss and spoiled food, coping with the aftermath of a powerful storm could be very troublesome for restaurant owners. The Federal Emergency Management Agency (FEMA) estimates that about 40% of small businesses will unfortunately never reopen after a disaster1. Therefore, during the Atlantic Hurricane season, which officially runs from June through November, hospitality owners and managers must take a multi-pronged approach to safety. First, crisis communications, management and business continuity planning and then back up efforts with the proper insurance coverage. Last year’s hurricane season accounted for more than $33 billion in damages with 154 estimated fatalities2. For the 2019 season, the National Oceanic and Atmospheric Administration (NOAA) is forecasting 9 to 15 named storms, 4 to 8 hurricanes with up to 4 major ones3. While restaurants, hotels and other businesses in the hospitality industry have no control over the weather, taking the proper steps before a hurricane can lessen the impact. Generally speaking, the three main goals of any disaster management plan are to manage the business during the crisis, resume normal operations as quickly as possible, and recover losses when it is over. By taking these goals into account when sur-

Robert Fiorito serves as Vice President with HUB International Northeast, a leading global insurance brokerage, where he specializes in providing insurance services to the restaurant industry. As a 25+ year veteran and former restaurateur himself, Bob has

Last year’s hurricane season accounted for more than $33 billion in damages with 154 estimated fatalities. While restaurants, hotels and other businesses in the hospitality industry have no control over the weather, taking the proper steps before a hurricane can lessen the impact. veying the most critical areas of the business, companies can determine what steps they need to take to be fully prepared for hurricane season and beyond. As mentioned above, having a crisis communications, management and business continuity plan in place will help ensure employee stability in the workplace. Pre-determined employee notification channels will be critical to disseminating information should the need arise. Business owners and managers should have employee contact information at their fingertips, while also establishing a toll-free hotline number or social media site that can facilitate communication during a storm. Similarly, understanding individual risk is key to necessary business continuity planning. Try isolating the business risk first. Is it wind,

12 • July 2019 • Total Food Service • www.totalfood.com

power outage or hurricane damage? Will your business be down for a week, a day or a month? Review your business assets and make sure the operations that are most critical have built-in redundancy or are covered by insurance. Coverage for When it Strikes Losses are not always completely avoidable. Even businesses with the proper plans in place can suffer a setback from a storm. It’s important to examine your insurance coverage in advance with your professional advisor as there are a variety of policies to help coastal and non-coastal businesses recover from an event – each involving a different aspect of the restoration. It’s important to realize that all businesses in hurricane zones are at risk no matter where they are located.

worked with a wide array of restaurant and food service businesses, ranging from fast-food chains to upscale, “white tablecloth” dining establishments. Robert can be reached at 212338-2324 or by email at robert.fiorito@ hubinternational.com.

Business income coverage. Review your business income coverage limits, which include loss of income as a result of an event, to ensure they are sufficient. Extra expense coverage often accompanies business income coverage for necessary costs, such as having to relocate your business operations to a temporary location as a result of storm related damage. Go through a potential business interruption to determine the estimated monthly costs for both loss of income and extra expenses. How long will it take you to get your business up and running again? How much can you afford to lose? Base insurance coverage needs on identified risks to ensure that any business interruption will be covered to the greatest extent possible. Flood coverage. It’s important to understand that most business property policies exclude flood cov-

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Profile for Total Food Service

July 2019 - Total Food Service  

From totalfood.com - Total Food Service's July 2019 Digital Issue features an exclusive Q&A Interview with restaurateur & author Stratis Mor...

July 2019 - Total Food Service  

From totalfood.com - Total Food Service's July 2019 Digital Issue features an exclusive Q&A Interview with restaurateur & author Stratis Mor...