Firms of all sizes and in all industries face a plethora of risks in day-to-day operations as well as ongoing business models and strategies. Some risks are simply more inherent to certain business models than others, such as natural disasters and pandemics that recently disproportionately affected businesses that depend on foot traffic while digital businesses have comparatively thrived.
But even agile digital operations face different types of business risks. The Hauser Insurance Group performs risk assessment as each company’s risk profile is unique. However, business owners and decision-makers need to be aware o the following risk categories as they apply regardless of firm size, industry, location, and managerial experience.
External operational risks are factors beyond the company’s control that take place outside of its purview. This would encompass natural disasters, pandemics, civil unrest, and other singular events or enduring conditions that make it difficult or impossible for the organization to function. Extreme weather conditions as a result of seasonal changes are external operational risks even if they are fairly predictable, while natural disasters and power outages that impact operations would be considered equally.
Internal operational risks also cause business stoppage but they come from within, such as employee theft, embezzlement, and destruction of property. Company-wide technical issues, like email server outages, would also be an internal operational risk rather than an external one.
The Hauser Insurance Group recommends having contingency and business continuation plans in case any of these events take place, such as having secure physical and digital locations to retrieve data in case of a disaster.
Staying in compliance with federal, state, local, and international regulations is a challenge every business must face. Regulations for data management, workplace safety, taxes and business administration, and environmental responsibility are just a few areas in which businesses of all types must comply and not always be aware of their compliance requirements. Laws also frequently change, which only compounds the risk.
While most businesses operate in good faith and want to stay compliant, risks can be as small as additional paperwork or a small fine while more grievous infractions can result in heavy fines or disruption of operations.
The Hauser Insurance Group’s compliance specialists recommend that you work with one to determine which laws and regulations are applicable to your business, and how you can mitigate this risk on an ongoing basis.
As technology has become crucial for organizations to function, technological and cybersecurity risks have increased in tandem. Businesses face the same or even more targeting than individuals when it comes to databases full of personal information being leaked, computer networks falling into disarray, and increased attack surfaces as offices contain more devices than ever before. With the COVID-19 pandemic sending millions of office employees to work at home, the increased reliance on personal devices and residential networks with poorer security protocols resulted in a sizable amount of organizations being vulnerable to cyber attacks and breaches.
DDoS attacks, ransomware, and breaches are risks that every company faces, but small and medium-sized businesses are the most vulnerable as they tend to not have IT departments and robust protections in place. However, large firms still face unique technological risks now that hackers have figured out how to export data by infiltrating backup systems and have gotten more creative with ransomware.
By performing an extensive risk assessment of your business, the risk experts at Hauser Insurance Group can determine which procedures you should have in place for your unique risk profile.