U.S. businesses face many risks on any given day. One that isn’t thought of, or considered, as often as perhaps it should be, is the risk of an earthquake. While it’s true that some areas of the country are more likely to experience earthquake activity than others, there are very few places in the nation that cannot be impacted by a strong enough earthquake.
As a small business owner, planning for the possibility of earthquakes may not be a high priority on your “to do” list, but it needs to be. According to the United States Geological Survey (USGS), businesses in 42 states have a reasonable chance of damaging earthquakes within the next 50 years. Sixteen of those states have a relatively high likelihood of experiencing damaging earthquakes within that same span of time.
TheInsurance Information Institute reports that nearly 5,000 earthquakes affect the United States each year. The Institute reports that since 1900 there have been earthquakes in 39 states with damage affecting all 50 U.S. states.
Even states that are not at the heart of the earthquake activity, known as the epicenter, can experience structural damage to buildings, parking lots, and other items as a result of seismic activity in nearby states. Strong earthquakes can send tremors and aftershock activity several states away – affecting homes and businesses as they continue.
What does this mean for Your Small Business?
Different businesses will experience different types of fallout from earthquakes and earthquake activities. You must make efforts to protect your small business against the damage earthquakes leave behind when they do occur. These are a few steps you might want to take.
Build Beyond Earthquake Standards
Some states require all homes and businesses to be built to certain earthquake resistance standards. There are many contractors that specialize in something known as earthquake engineering who can help protect your business to some degree from seismic activity. Remember though, there is no such thing as earthquake proof.
Create a Disaster Plan for Your Business
Create a disaster recovery plan. Conduct drills. Make sure everyone who works for your business knows his or her roles and responsibilities in the event of an earthquake. Knowing what to do and practicing frequently are critical tools for reducing panic when earthquakes occur.
Your property insurance policy may not extend coverage to damage left behind by earthquakes. Like flood insurance, it is important to purchase a separate earthquake insurance policy to cover damage caused by earthquakes. Pay special attention to content coverage for small businesses as the standard coverage of an earthquake policy is rarely adequate to replace damaged merchandise. Talk to your small business insurance agency about business interruption insurance.
Don’t forget to consider riders for lost income if you’re forced to close your business due to cleanup needs, gas leaks, and other problems commonly associated with earthquakes.
The truth of the matter is that there is nowhere in the country that is earthquake proof. You need to make sure your small position is positioned to limit the damage earthquakes can do wherever your business may be.