Small firms ‘failing to plan’ for the unexpected

UK firms are at risk of going out of business due to a lack of planning for unexpected events, according to the Association of British Insurers (ABI).

Recent data gathered by the insurance body reveals that seven out of ten small businesses would fold if they experienced a major emergency in their first year of trading.

It has also been revealed that two-thirds of firms do not have adequate contingency plans in place to deal with an unexpected disaster, such as a fire or flood.

The ABI has now joined forces with the Government to raise awareness of contingency planning amongst Britain’s 4.3 million small and medium-sized enterprises.

The severe flooding which crippled thousands of businesses last Summer illustrates the need to plan for the unexpected, according to Stephen Haddrill, ABI Director General.

Commenting on the publication of a new advisory guide, Pat McFadden, Minister of State for the Department for Business, said: ‘The millions of people who launch, lead and work for small businesses up and down the country create vital jobs, provide essential services and generate significant wealth for the country.’

‘This latest guidance provides vital risk management advice to help ensure our small businesses grow and flourish,’ she added.

You can view the guide to insuring your business at www.abi.org.uk/SMEGUIDE.