Our Most Popular Managed Services

If you need help deciding what services are best for your business let us know.

VT Logo header logo wrap shape

VT Logo header logo wrap shape

Award-Winning Dallas-Fort Worth IT Services.

Questions? Call (817) 595-0111

inner banner overlay

×

Error

The CEGCore2 library could not be found.

VersaTrust Blog

VersaTrust has been serving the Texas area since 1997 , providing IT Support such as technical helpdesk support, computer support and consulting to small and medium-sized businesses.

Hurricane season DR tips

The chances of your business being hit by a hurricane are slim. But this year, the odds are actually alarming -- the National Oceanic and Atmospheric Administration (NOAA) predicts up to four unusually active hurricanes. If you don’t want to fall victim to data loss and tarnish your business’s reputation in the process, read on.

The NOAA forecasts 11 to 17 tropical storms in the Atlantic, the Caribbean Sea, and the Gulf of Mexico. Hurricane season has officially begun and is expected to last until the end of November. The four allegedly active hurricanes are presumed to be Category 3, 4, or 5 on the Saffir-Simpson Hurricane Wind Scale (Category 1 is the weakest and 5 the strongest).

But don’t panic just yet; here are five steps you can take to protect your business during hurricane season.

1. Schedule a DR drill

Despite having a DR plan, many companies don’t test their plan, at least not as often as they should. So if you’re one of those companies, it’s crucial to conduct a DR drill now. A lot can change in the months or years since you have last tested your plan -- systems updates, infrastructure upgrades, employee turnover and more. By scheduling a drill, you’ll be able to make sure everyone knows their roles and that all critical systems are covered.

Note that you should try to perform desktop walkthrough exercises, operational tests, and simulated recovery exercises on a regular basis.

2. Make sure your staff are prepared

All your staff should know what the evacuation procedures are as well as their responsibilities in the DR process. If not, coordinate with HR to make sure everyone in your company understands what the plan of action is for hurricane season. Staff with specific responsibilities need to get the documentation needed to effectively manage their roles in the event of a hurricane.

Set meetings with your DR team and schedule training for new team members. Your DR team should be able to quickly mobilize other employees to the DR site before bad weather hits. Don’t forget to touch base with any providers you are supposed to work with in case of an emergency, too.

3. Secure your backup site

In addition to a secondary location for data storage, your DR plan should also include another backup site so that you can continue your operations. In the event of a hurricane, dedicated space is imperative since your backup sites will likely be occupied with employees.

You should also consider the redundancy of utilities at your DR site, making sure you have enough power feed, fiber carriers, and anything else you’ll need to remain operational.

4. Check for amenities at your DR site

Whether your DR site is in the hurricane zone or in the nearest city, chances are hotels will be overbooked as people fight for a place to stay. This means your staff will likely be stuck onsite around the clock, so you need to make sure there is enough amenities to get them through this hectic period. Is there a place for employees to shower and sleep? Is there enough food and water to last them for at least a couple of days? These amenities will help your staff pull through as they restore your operations.

5. Update your DR plan’s appendix

Your DR plan should have an appendix with contact information, SLAs, and systems inventories information. More importantly, this information needs to be up-to-date; the last thing you need is calling your IT vendor when a server goes down only to reach the wrong number.

Go through all critical information in your DR plan and add any other information as needed. Vendors and shipper's contact information are a must as they will guarantee that you get hardware and power supplies backup without any hassles.

Unlike a fire drill which can be conducted on a yearly basis, your business continuity and disaster recovery plan needs to be tested regularly to meet your company’s changing needs. If you don’t already have a DR plan, or have any further questions, don’t hesitate to give us a call.

Published with permission from TechAdvisory.org. Source.

Continue reading

Virtualization review: What is it again?

Every now and then, we need to reset the conversation about virtualization and review how it works in its most basic form. With so many advances, it can be hard to keep up if you’re not a regular reader. This article not only defines virtualization and its benefits, it also includes a real-world workstation for you to experiment with!

What is virtualization?

The simplest definition is this: It’s the act of creating a virtual (rather than physical) version of something, including hardware platforms, storage devices, and computer network resources. But that doesn’t do much for those outside of the IT industry.

We could paint a colorful analogy to try to better explain it, or we could let you paint with your very own virtualized demo. Follow these steps so you can see how virtualization works:

  1. Visit this website.
  2. Wait while your virtualized 1991 Macintosh boots up.
  3. Double-click the ‘Kid Pix’ desktop icon.
  4. Write “This is virtualization” on the blank canvas.
  5. Click (and hold) File, and select Save As.
  6. Click the Save button in the new window.
  7. Quit ‘Kid Pix’.
Voilà! Your picture was saved to that old-school Mac's virtual hard drive. That’s because everything -- from the operating system to the processor -- is running on a server located somewhere else on the internet. And it’s not just some remote desktop viewing trick, this ’90s-era Mac and its hardware have been created by software installed on a server that is concurrently processing a million other tasks.

It’s a fun demonstration, but modern-day virtualization can accomplish much more.

Divide up hardware resources

The dated nature of that machine actually helps us better illustrate the biggest benefit of virtualization. The software that lets us create virtual machines also allows us to define exactly how much hardware each workstation gets.

For example, this Mac has only 3.8 MB of hard drive space, but if your virtualization server has 10,000 GB of space, you can create 100 virtual desktops with 100 GB of storage space. It’s a bit of an oversimplification, but that’s essentially how it works with storage hardware, CPUs, RAM, and other hardware.

Reduce on-site costs

The bulk of your workstation and server hardware is usually hosted off-site, which means lower utility bills, computer equipment requirements, and maintenance overhead. Instead of patching and upgrading each workstation’s software and hardware individually, virtualization allows you to apply changes to all your machines at once.

Disaster recovery

If your virtualization server is hosted off-site, what happens when natural disasters, power outages, theft, or vandalism strikes your office? Or, as a simpler example, where did you store your Kid Pix masterpiece? Certainly not on the machine you’re reading this blog from.

Virtualization allows you to keep mission-critical data stored safely away from the office so your team can get back to work as soon as your IT provider gets them access to the server again. And with a single point of management (i.e., your off-site server), that can take place in virtually no time at all.

Ending your dependence on individual machines and their hardware is just one of the many ways to utilize the power of virtualization. You can define network hardware and configurations with software, run applications on any operating system, and so much more. To find out which solution is best for your business, call us today!

Published with permission from TechAdvisory.org. Source.

Continue reading

Why consider disaster recovery for 2017

The new year is well upon us, and with it comes an equally new IT budget. Judging by the advancements in computing technology, many 2017 business wish lists probably include powerful onsite servers, workstations, and the Internet of Things. But as tempting as these purchases may be, it’s important that you don’t dismiss an old yet essential IT resolution: disaster recovery.

DR isn’t a huge investmentA common misconception about disaster recovery is that it’s a large, bank-breaking investment. Expensive secondary data centers, networks, and server maintenance usually come into mind when a business owner is confronted with the idea of business continuity. And while that may have been true in the past, establishing a strong disaster recovery plan today is as simple -- and as cheap -- as going to a cloud-based disaster recovery provider and paying for the data and services that your business needs. Subscription pricing models are actually incredibly low, meaning you can have minimal downtime while still having enough to invest in new tech.

Onsite backups just won’t cut itAlthough you might feel secure with a manual backup server down the hall, it is still susceptible to local disasters and, ultimately, does very little in minimizing company downtime. When disaster recovery solutions are hosted in the cloud or in a virtualized server, restoring critical data and applications only take a few minutes.

Business disasters can be man-made, tooEven if your workplace is nowhere near frequent disaster zones, cyber attacks and negligent employees can leave the same impact on your business as any natural disaster can. Setting a weak password, clicking on a suspicious link, or connecting to unsecured channels is enough to shut down a 5-, 10-, or even 50-year-old business in mere minutes.

Sure, installing adequate network security is a critical strategy against malicious actors, but last year’s barrage of data breaches suggests that having a Plan B is a must. A suitable disaster recovery plan ensures that your data’s integrity is intact and your business can keep going, no matter the malware, worm, or denial-of-service attack.

Downtime will cost youA business without a DR plan might come out unscathed after a brief power outage, but why risk the potential damages? Either way, downtime will cost your business. First, there’s the general loss of productivity. Every time your employees aren’t connected to the network, money goes down the drain. Then there’s the cost of corrupted company data, damaged hardware, and the inevitable customer backlash. Add all those variables together, and you end up with a business-crippling fee.

So, if you want 2017 to be the best year for your business, make the smart choice and proactively take part in creating your company’s business continuity plan. Your business will be in a better position financially with it than without it.

Keep your business safe, recover from any disaster, and contact us today.

Published with permission from TechAdvisory.org. Source.

Continue reading

4 Lessons to learn from Delta’s DR failure

Delta is paying big for the IT outage that occurred last month: millions of dollars in damages, 2300 cancelled flights, and significant reputational damage. Despite the harsh cut to the airline’s bottom line, Delta will probably still survive. But the real question is this: Can your business survive after long periods of downtime? A natural disaster, power outage, or successful hack can be the downfall of many small- to medium-sized businesses. But if you learn from the lessons of Delta’s IT mishap, your organization has a good chance of staying on its feet.

Strive for 100% redundancyAccording to Delta’s chief information officer, a power failure caused the company’s data center to crash, grounding thousands of would-be passengers. Although power was restored six hours after the incident, critical systems and network equipment failed to switch to a secondary site, corrupting valuable data in the process. And while some systems failed over, other vital applications didn’t; this created bottlenecks, decreased revenue, and diminished customers’ confidence.

Delta’s case is a massive wakeup call not just for the airline industry but for every business -- large and small. Companies must implement disaster recovery plans for their data centers, on-site technology, and Cloud applications to continue servicing customers while fixing the main issue with their primary systems. Companies also need to get rid of the false notion that redundancy plans to assure service continuity is restricted to larger corporations. DR and business continuity solutions are extremely affordable today, and a partnership with a provider can help you in more ways than one (more on this later).

Always test your backups

So although Delta had a plan to bring its business back to normalcy, the DR plan left a lot to be desired in practice. This begs the question as to whether the airline company is actually testing, reviewing, and reinforcing its vulnerabilities to different disasters.

The point is that even though your company may have a failover protocol in place, that protocol adds no value to your business unless it has been rigorously tried and tested. In order to avoid the same fate as Delta, make sure to find out whether your disaster recovery plan is capable of running mission-critical applications like email and customer service applications before -- not after -- downtime occurs.

Account for different types of vulnerability

In an interview with the Associated Press, Delta CEO Ed Bastian said, “We did not believe, by any means, that we had this type of vulnerability.” Indeed, it’s often hard to foresee what threats and vulnerabilities a natural disaster, power outage, or hacker can produce. But it’s not impossible.

By conducting a comprehensive audit of your data center security and disaster protocols, your business will be more aware and adept at minimizing the risk of potential disasters. This also means evaluating and preparing for disasters that are likely to happen to your business depending on its geographic location. Southern US, for instance, is prone to hurricanes and flooding.

Call for help

These lessons and strategies are all crucially important, but pulling off a DR and business continuity solution on your own may be difficult. For this reason, it’s critical to have a planned partnership with a managed services provider that can assess, plan, test and install the continuity solutions your business needs in order to minimize the impact and avoid encountering a Delta IT outage of your own.

To find out more about business continuity and guaranteeing complete IT redundancy, contact us today.

Published with permission from TechAdvisory.org. Source.

0 Comments
Continue reading

Is your continuity plan doomed to fail?

Just because your IT provider has a plethora of awards and certifications under its belt doesn't mean that you can blindly hand over your business’s future to them. Often times, there are some aspects in your business continuity plan that tend to be overlooked by your provider. We have rounded up some of these issues that could appear when you enact your business continuity plans.

Over-optimistic testing

The initial testing attempt is usually the most important as it’s when IT service providers can pinpoint possible weak points in the recovery plan. However, what usually happens is a full transfer of system and accompanying operations to the backup site. This makes it difficult to look at specific points of backup with too many factors flowing in all at the same time.

Insufficient remote user licenses

A remote user license is given by service providers to businesses so that when a disaster strikes, employees can log in to a remote desktop software. However, the number of licenses a provider has may be limited. In some cases, more employees will need to have access to the remote desktop software than a provider’s license can allow.

Lost digital IDs

When a disaster strikes, employees will usually need their digital IDs so they can log in to the provider’s remote system while their own system at the office is being restored. However, digital IDs are tied to an employee’s desktop and when a desktop is being backed up, they are not automatically saved. So when an employee goes back to using their ‘ready and restored’ desktop, they are unable to access the system with their previous digital ID.

Absence of communications strategy

IT service providers will use email to notify and communicate with business owners and their employees when a disaster happens. However, this form of communication may not always be reliable in certain cases such as the Internet being cut off or with spam intrusions. There are third-party notification systems available, but they are quite expensive and some providers sell them as a pricey add-on service.

Backups that require labored validation

After a system has been restored, IT technicians and business owners need to check whether the restoration is thorough and complete. This validation becomes a waste of time and effort when the log reports come in a manner that is not easy to compare. This usually happens when IT service providers utilize backup applications that do not come with their own log modules, and have to be acquired separately.

These are just some of the many reasons why business continuity plans fail. It is important for business owners to be involved with any process that pertains to their IT infrastructure. Just because you believe something works doesn’t necessarily mean that it works correctly or effectively. If you have questions regarding your business continuity plan, get in touch with our experts today.

Published with permission from TechAdvisory.org. Source.

0 Comments
Continue reading

The DR benefits of Virtualization

When most business owners think of Virtualization, they likely don’t think of Disaster Recovery. The truth is, though, that Virtualization is a multi-faceted IT solution that can provide an effective backup in case your business is hit by a disaster. So for those who are new to the idea of Virtualization as a Disaster Recovery solution, here’s a breakdown.

As opposed to tape backups, Virtualization reduces recovery time in the event of a disaster. While tape backups can be reliable, using them to fully restore your system after a backup can be an excruciatingly long process. In fact, it can take up to two days to do just that. Think of all the business you could lose in those two days. Think of all the lost money in salaries you’ll pay out out to employees who aren’t working. Simply put, Virtualization is much quicker than tape backups when it comes to Disaster Recovery. Your entire system can be restored in four hours or less. How does this happen? Well, instead of rebuilding your servers, operating systems and applications separately, they exist safely off-site and can be brought back online via your virtual backup.

While the speed of virtualized backups might sound alluring, there are a few key points you should be aware of before moving forward. Here’s what you need to think about:

  • Critical data - where do you want your critical data to be stored? Do you want it stored on tapes? Disk technologies? Or on your virtualized servers? Perhaps it’s best to spread your risk by backing up your critical data to multiple sources because, frankly, your business depends on this data. Regardless, find out what critical data you need to operate your organization and devise a plan to back it up as you see fit.
  • Data to be backed up - Whether or not you decide to store your critical data on your virtual machines, figure out what data and assets you do want stored on them. Then designate specific virtualized servers to store these assets. In case a disaster does happen, you’ll know immediately where your backups live, and can retrieve your data quickly and get your business up and running again fast.
  • Systems to be virtualized - Just as your business has critical data, you also have critical applications. Some of these may include email, Microsoft Office, and applications or software developed in house. Whether or not these applications qualify as critical for your business, identify the ones that do and focus your disaster recovery efforts on them. Like your data and servers, applications can all be virtualized and then safely stored off-site.
If you choose Virtualization as part of your Disaster Recovery solution, make sure your backups are monitored regularly so they’re up-to-date in the event of a disaster. And besides Disaster Recovery, there are many other benefits to Virtualization. Your business can reduce the amount of servers and other hardware in your office, lower your electricity costs, and save money in the process. Consider Disaster Recovery as a nice bonus that’s included with these benefits.

Curious to learn how else Virtualization can benefit your business? Interested in a dedicated Disaster Recovery solution? Call us today and discover how our experts can protect your organization and save you money.

Published with permission from TechAdvisory.org. Source.

0 Comments
Continue reading

3 Disaster Recovery myths

Disaster Recovery ain’t what it used to be. Long gone are the days where a DR solution cost over a hundred thousand dollars and predominantly relied on tape backups. With the onset of cloud computing, today’s DR landscape has dramatically changed. But, unfortunately, there are still many misconceptions about DR still hanging around. Here are a few of the myths that no longer apply.

Tape Backups are the best DR solution

Like a car, computer or television, tape is a physical object that deteriorates over time. Don’t believe us? Go ahead and listen to your favorite cassette. One day your tape backups will become distorted and no longer work. And hopefully, that day isn’t the same one when your business suffers a disaster. However, there is a good chance all your tape backups will work. So does that mean there’s nothing to worry about? Well, consider where you store your tape backups. Are they on-site or in a location within a few miles of your office? If so, remember that if your business is hit by a natural disaster, chances are those tapes nearby will be hit as well. And if they’re damaged or become inaccessible, say goodbye to your business continuity.

While tape backup is better than nothing, many of today’s DR providers will backup your data to an offsite location that is far away from the neighborhood your office is at. That way, if your business is affected by a disaster, your backup is located hundreds of miles away in a safe place that is likely untouched.

It’s also worth noting that modern day DR solutions also provide another valuable commodity - time. So ask yourself, is the mindless task of backing up tapes really worth the time of your IT staff? Wouldn’t you rather have them working on more valuable tasks that require a skill? Today’s DR service providers eliminate this need, as they take care of nearly everything. You or your staff will never have to bother with it.

The RTO you want will be too expensive

Recovery Time Objective (RTO) is of primary importance to most business owners. And who can blame them. If you’re going to invest in a Disaster Recovery solution, you want to be able to rely on it to recover quickly (on a timetable that won’t damage your business). In the old days before the cloud, a quick recovery time could cost you well into six figures. Today, tools such as the cloud and virtualization have made this much more affordable, and faster than ever. Most DR providers can backup all your critical data in a matter of minutes. And if you ever need to recover it, most services can do so in hours, rather than days. That’s the power of the cloud. And when it comes to DR, it truly has changed everything.

Disaster Recovery is for big business, not SMBs

Well, it once was. Again, the cloud has really leveled the playing field. And it is making a truly valuable service accessible to businesses of all sizes. From dental offices to small retail operations, SMBs can now easily take advantage of the best DR solutions on market, as the barriers of complexity, costs, and insufficient IT resources no longer apply. Modern IT advances and the cloud have eliminated these obstacles.

We hope these three myths will help you see how Disaster Recovery is more affordable and efficient than ever. If you’d like to learn how our DR solutions can safeguard your business, send us a message. We’re happy to fill you in.

Published with permission from TechAdvisory.org. Source.

0 Comments
Continue reading

How you can benefit from virtualization

Whether it’s to backup your servers, upgrade your hardware or move towards a full-blown cloud based system, virtualization has become a popular solution for many companies. While the term virtualization has increasingly become a cost-effective strategy for many businesses, is it the right one for you? Here are some advantages to deploying a virtual system to your company plus some factors you should consider before making the final decision.

The advantages

Virtualization provides your company with plenty of cost-effective benefits. Probably the first and largest advantage virtualization brings is the fact that you won’t have to buy more hardware to supplement your company’s needs. Basically, by consolidating your physical servers, there won’t be a need to maintain and update unnecessary hardware in the workplace. This means less time and money is spent on maintaining and running your servers as well as spending too much time on desk side support.

With virtual machines, backing up your entire data center has never been easier. This is because these virtual machines have the ability to take up-to-date snapshots of your servers and simply redeploy them seamlessly to another device. Unlike physical servers, where you have to create backups of your server and current data, virtual backups essentially cut the waiting time for server reboots.

This also eliminates the worry of accidentally losing files. Should disaster strike your physical servers, you can easily migrate your virtual machines to another device and keep working as if the incident never really happened.

Additionally, opting for virtualization allows your company to have a higher degree of technological versatility because virtual machines have the added flexibility to run on different platforms, servers and hardware. Meaning you won’t be tied down by a single IT provider. What’s nice about virtual machines is that your company now has the freedom to upgrade hardware without long server downtimes and even have the ability to use thin clients in the workplace.

Finally, utilizing virtualization solutions puts your business in a good position to easily migrate to a prolific cloud environment.

Factors to consider

With seemingly no disadvantages to virtualization you’re probably getting ready to set-up some virtual machines. But before you start virtualizing your business, here are some things you should consider first:
  • Initial costs to set up your network’s hardware and software still exist, so make sure you thoroughly check the services and devices that your company needs before moving forward.
  • Note that virtualization is an effective solution when you start having 5-7 servers running in your workplace. Usually 10-15 servers is the optimal number when you’ll start seeing a return on your investment. If you have less servers than the ones suggested above, then it’s probably best to opt for a different IT solution.
  • It’s important to consider your staff’s skills and experience with technology before switching over to virtualized systems. Do they need training? How can you help them transition quickly into the proposed infrastructure?
  • Will your business have enough storage capacity? As a general rule, you should set aside 30-40 GB per user.
  • Think about setting up failovers to ensure the security of your virtual system.
  • Some applications are not usually compatible with virtualization such as mobile, media-rich and some security apps. So if your employees tend to use these types of software it would probably be best to deploy a smaller scale virtualization solution.
  • Pay attention to the conditions of your software license. Installing some applications to several computers could lead to increased costs.
Overall, the increased flexibility and reduced cost that a virtualized system offers for your IT infrastructure is well worth the effort. While there are initial challenges to worry about when it comes to implementing virtual machines into the workplace, this is a step many small businesses consider to remedy their outdated IT ills. Contact us today to find out if virtualization solutions are for you.
Published with permission from TechAdvisory.org. Source.

0 Comments
Continue reading

The Importance of Disaster Recovery

Most business owners don’t normally think they will be a victim of a natural disaster...not until an unforeseen crisis happens and their company ends up suffering from thousands or millions of dollars in economic and operational losses -- all because of the lack of thoughtful disaster preparedness. This post gives small or mid-sized businesses (SMBs) basic information on the vital importance of having a Disaster Recovery (DR) plan to help them survive any potential disasters.

As we all know, unpredictability is a fact of life. The aftermath of Tropical Storm Bill in Texas and recent floods in South Carolina are a grim and unfortunate lesson for many overconfident business owners who think their companies are spared from the likelihood of cataclysmic weather, technological malfunctions, or human actions. A 2014 survey by the IT Disaster Recovery Preparedness (DRP) Council reveals just how many companies worldwide are at risk: 73 percent of SMBs are failing in terms of disaster readiness. What does this mean? It means that 3 out of 4 companies aren’t prepared to handle emergencies and save their businesses from a worse-case scenario.

If it’s not clear and compelling enough for a business owner like yourself to consider putting a well-conceived Disaster Recovery (DR) plan into place, perhaps it’s time to give it some thought. Doing so can save you years of business loss. Here is some useful information about what DR is all about and how it can ensure your business’s survival in the wake of unforeseen circumstances.

What is Disaster Recovery (DR)?

Disaster recovery is a plan for restoring and accessing your data in the event of a disaster that destroys part or all of a business’s resources. It is a key component involving many aspects of business operations that requires this information to function. The job of a DR plan is to ensure that whatever happens, your vital data can be recovered and mission-critical applications will be brought back online in the shortest possible time.

What kind of disasters are likely to happen?

Business disasters can either be natural, technological, or man-made. Natural types of disasters include floods, earthquakes, tornadoes, hurricanes, landslides, tsunamis, and even a pest infestation. On the other hand, technological and man-made disasters involve hazardous material spills, infrastructural or power failure, nuclear power plant meltdown or blast, chemical threat and biological weapons, cyber attacks, explosions, or acts of terrorism and civil unrest.

Why does your business need DR?

Regardless of industry or size, when an unforeseen event takes place and causes day-to-day operations to come to a halt, a company will need to recover as quickly as possible to ensure you will continue providing services to clients and customers. Downtime is one of the biggest IT expenses that any business can face. Based on 2015 disaster recovery statistics, downtime that lasts for one hour can cost small companies as much as $8,000, mid-size organizations $74,000, and $700,000 for large enterprises.

For SMBs particularly, any extended loss of productivity can lead to reduced cash flow through late invoicing, lost orders, increased labor costs as staff work extra hours to recover from the downtime, missed delivery dates, and so on. If major business disruptions are not anticipated and addressed today, it’s very possible that these negative consequences resulting from an unexpected disaster can have long-term implications that affect a company for years. By having a Disaster Recovery plan in place, a company can save itself from multiple risks including out of budget expenses, reputation loss, data loss, and the negative impact on clients and customers.

How do I create a DR strategy for my business?

Creating, implementing and maintaining a total business recovery plan is time-consuming but extremely important to ensure your business’s survival. Many organizations don’t have the time or resources to dedicate to this process. If you would like to protect your company from unexpected disasters but need further guidance and information on how to get started, give us a call and our experts will be happy to discuss Disaster Recovery options and solutions with you.
Published with permission from TechAdvisory.org. Source.

0 Comments
Continue reading

Business interruption insurance 101

While it is highly likely that you have an insurance policy that will cover your small or medium-sized business in the event of a disaster, chances are you don’t have business interruption insurance. The majority of smaller companies tend to overlook interruption policies, believing (or at least hoping) that regular insurance will be enough to protect them. But in the face of rising natural disasters, you may want to think again.

So why do small and medium-sized organizations tend to forego business interruption insurance policies? Chances are it, like so many things, comes down to cost. But can you really afford to ignore the additional protection that interruption insurance offers, or is it safe to cut corners and hope that your regular business insurance will have you covered in the event of a disaster?

While an interruption insurance policy may cost you anywhere from $750 to $10,000 or more (the cost is normally dependent on the size of your business), the fact is that your standard insurance policy will not cover you completely when a catastrophe strikes.

Take for example the spate of superstorms that have ravaged the United States over the past decade. From Hurricane Katrina to the more recent Sandy, small businesses and enterprises throughout the US have been left devastated after feeling the wrath of Mother Nature. While a best-case scenario may entail losing a few days sales during a power outage, at the other end of the scale you could find yourself dealing with a destroyed warehouse, an office that no longer has a roof, or thousands of dollars worth of stock destroyed by flooding.

And the reality is that your regular insurance is probably not going to reimburse you for storage or relocation costs if you need to move operations elsewhere, temporarily or otherwise. The majority of policies will only cover the loss of, or damage to, physical items like stock, equipment and property. They will usually not cover you for any loss in profit if a disaster means that you need to temporarily cease trading. On the other hand, tightly drawn up business interruption insurance should cover you in the event you need to move. It should also cover a decrease in sales due to power failures that shut your communication lines down, as well as a drop in profits due to delays in the delivery of stock or equipment.

Think the chances of a natural disaster affecting you are still slim despite the scenes of chaos and devastation reported in the media? Consider that a recent survey conducted by insurance giant Allianz found that there are now typically 600 major incidents per year – compare that to the previous 400 per annum and it doesn’t take a mathematician to figure out that disasters are on the rise.

So, as a small or medium-sized business owner, what do you need to know before you consider purchasing interruption insurance? If you’re thinking of adding interruption coverage to your existing policy, first record your current net income - but watch out because, if your net profit is high, you might be hit by a low per-incident limit. You could find your insurer has limited your coverage and left you inadequately protected.

Is business booming? If you are undergoing rapid growth, keep records spanning many months so you have proof of revenue increase. Without this, you will not be able to forecast month-on-month profit growth and your insurer might cap coverage at the rate of the previous year’s profit, not at your accelerated one. Be aware, too, that the type of interruptions you want protection for should reflect the areas covered in your general business policy. If your existing policy doesn’t include coverage for fire damage, neither will your interruption insurance.

There are many other aspects of an interruption policy to take into account – such as add-ons that protect you in the event of a power outage (something that standard policies normally don’t normally cover), and knock-on effects caused by a disaster at your supplier’s end.

Once you have taken out interruption insurance, should you have to use it then the most important aspect for you will be getting reimbursed. Crucially, you need to be able to provide your insurer with as many details concerning profit loss as possible. Consider storing files electronically, either offsite or in the cloud. That way, if your office or store is destroyed, you’ll still have access to your documents – and a far greater chance of recovering your losses.

If you’d like to learn more about protecting your data, files and documents, as well as about business continuity planning to help you get back up and running should disaster strike, please get in touch with our team today.

Published with permission from TechAdvisory.org. Source.

0 Comments
Continue reading