While 52 percent of small business owners say it would take at least three months to recover from a disaster more than 75 percent don’t have a disaster plan, according to a newly released survey by Ohio-based Nationwide Insurance.
Nationwide commissioned Harris Interactive, which conducted an online poll among 500 U.S. small business owners with fewer than 300 employees from June 8–19, 2015.
“Small businesses are least likely to have disaster recovery insurance,” says Mark Pizzi, president and chief operating officer of Nationwide Direct and Member Solutions. “And yet they are the ones most affected by a disaster. That’s why it’s essential for small businesses to have a disaster recovery plan.”
According to the survey, which was released September 1 to coincide with National Preparedness Month, one in four believe the likelihood of a natural disaster occurring in their area is slim (26 percent). Just over one-third (37 percent) say climate change and the weather phenomenon El Nino have decreased the likelihood of a natural disaster impacting their business.
Still, the gravity of the recovery from a natural disaster is not lost on small business owners — an estimated 25 percent of businesses do not reopen following a major disaster.
The survey revealed additional facts:
- While more than a third (38 percent) of small business owners say it is not important for their business to have a disaster recovery plan, over two-thirds (69 percent) have an evacuation plan at home.
- For many without a plan for their business, disaster recovery is simply a low priority (34 percent). Time (11 percent) or cost (15 percent) play little roles in the decision not to have a written disaster recovery plan in place.
- For companies with fewer than 50 employees, only one in five (18 percent) have a disaster recovery plan.
Unfortunately, if a disaster were to occur, 44 percent of small business owners say they don’t have access to generators — and 66 percent don’t even have business interruption insurance.
Nationwide has processed more than $417 million in catastrophe claims related to small businesses since January 2013.
Source: Nationwide Insurance