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Why you need a risk management programme

highways in forest

With mounting competition and globalization, you may be facing skill shortages, rising costs, and a more complex business environment than ever before. Add to that an increasing reliance on digital technology and a growing number of natural disasters, and you can see why small and middle market businesses need a risk management programme to minimise the risks they face.

If you don’t have a risk management programme in place already, here are some areas where your business may be vulnerable to risks, and recommendations for certain steps you can begin to take to prevent or minimise them.


  1. Your operations and property

    • Install a sufficient number of smoke detectors for your facility and have a qualified contractor inspect and test them every 12 months.
    • Use, store, and dispense of flammable or combustible liquids properly.
    • Ensure electrical systems are working properly, including scanning the main junction box every three years, and replace any extension cords with
    • permanent wiring.
    • Maintain clear, unobstructed walking and work spaces.
    • Make sure employees and guests utilise appropriate personal protective equipment as necessary.
    • Ensure machinery has appropriate guards and documented lockout/tagout procedures.
    • Provide a safe and controlled reception space for guests and customers.
  2. Your employees

    • Include background checks and employment history verification when hiring.
    • Train new employees and all employees annually on corporate policies, safety programmes, information management, and emergency response.
    • Document when training is complete.
    • Make sure you have an ergonomic programme in place.
    • Develop, review, and test your emergency evacuation plan every 12 months.
    • Establish policies and safeguards to protect against fraud and embezzlement.
    • Use a security system that easily removes access for former employees and contractors.
    • Train employees to properly use and maintain personal protective equipment.
  3. Severe weather

    • Develop a business continuity plan and emergency response plan and review them annually.
    • In a hurricane zone: Plan how you’ll secure loose outdoor fixtures, equipment, and storage; install hurricane shutters; and give employees time to safely evacuate and protect their own homes.
    • In an earthquake zone: Inspect building for structural weaknesses. Secure racks, shelving units, and furniture to the floor or walls, and install protective film on windows.
    • In an area prone to wildfires: Establish a 100-foot defensible space around your building. Irrigate plants around buildings and minimise combustible exterior storage.
    • In a flood zone: Have appropriate materials on hand (sandbags, flood walls, etc.), move critical assets to at least one foot above Base Flood Elevation, and install controls to prevent chemical and pollutant release.
    • Have a qualified roofing contractor inspect your roof each year.
  4. Health emergencies

    • Include a health emergency plan in your general business continuity preparation.
    • Outline both your response and the steps you’ll take for business recovery in the event of a severe health emergency, such as a viral outbreak or other major disease event.
    • Partner with your Human Resources team to determine alternative working models for employees, such as remote working
    • Educate employees on hygiene protocols and methods for protecting themselves from infection.
  5. Your IT systems and technology

    • Create a cyber security plan with assistance from a qualified information technology security professional using accepted cyber security standards for your type of operation. Include communications and cyber connections with customers and vendors.
    • Design and test a breach response plan and a plan to manage ransomware attacks.
    • Regularly back up critical data and system information off site and test its recovery.
    • Train your staff annually on strong passwords, social engineering/phishing, and protecting sensitive information.
    • Control access to sensitive data including personal, health, and business information.
    • Make sure manufacturing systems that rely on operational technology have dedicated cyber security control mechanisms to prevent intentional sabotage as well as accidental mistakes by workers and trusted third parties.


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No part of this article may be reproduced in any written, electronic, recording, or printed form without written permission of Chubb.

Disclaimer - All contents of this article are intended for general information/guidance purposes only and not intended to be an offer or solicitation of insurance products or personal advice or a recommendation to any individual or business of any product or service. This article should not be relied on for legal advice or policy coverage and cannot be viewed as a substitute to obtaining proper legal or other professional advice, or for reading the policy documents. You should read the policy documents to determine whether any of the insurance product(s) discussed are right for you or your business, noting different limits, exclusions, terms and conditions apply in each country or territory, and not all cover is available in all countries or territories.

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