Why Is It Important to Do a Risk Assessment of Your Business?

All businesses must account for certain risks and exposures. Regardless of your company’s diligence or attention to detail, accidents and errors may inevitably impact your operations, potentially causing significant property damage, expensive delays or costly lawsuits. Planning ahead is critical. Fortunately, by understanding and executing appropriate risk assessment, you can help minimize the likelihood and severity of these potential situations.

What is a Business Risk Assessment?

Assessing your risks is a core element of your company’s risk management efforts. Risk assessments typically entail analyzing your company’s circumstances to understand legal requirements and industry standards, as noncompliance could impose expensive consequences. Additionally, you should identify possible risks and perils relevant to your operations, such as using heavy machinery or possible liabilities for third-party losses.

Why Are Annual Business Risk Assessments Important?

Your company may garner many benefits from comprehensive risk assessments. Specifically, doing so may lead to the following:

• Increased safety—Identifying possible dangers in your business operations can limit the risk of injuries to your staff and other parties, such as clients and guests.

• Assured compliance—Your company is likely subject to certain requirements, such as the Management of Health and Safety at Work Regulations 1999. Failing to adhere to these mandates could lead to costly penalties, including noncompliance fines and orders to shut down operations.

• Greater financial security—Accidents and errors can impose unexpected financial burdens, including repairing or replacing your business property. Additionally, your company could be sued for incidents involving other parties, leading to potentially costly legal fees, settlements and judgments.

• Reduced insurance costs—You’re likely aware that business insurance is essential for your company’s risk management and loss control measures. You may be able to save on your premiums by conducting risk assessments, as they may help carriers feel safer providing coverage.

We’re Here to Help

Contact DRD Insurance Agency in La Habra, California, today to learn more about risk assessments and how they can help your company.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.