Whether operating a small business or commercial enterprise, all responsible companies must prioritize risk management. Certain perils and incidents may be inevitable for even the most responsible and diligent organizations, but planning ahead and making adequate preparations can help limit resulting consequences and ensure your organization’s losses are limited. With this in mind, regularly reassessing your businesses’ risks, such as annually, is generally an advisable practice.
What Is a Business Risk Assessment?
A business risk assessment generally entails a comprehensive analysis of your organization’s circumstances, including its operations, culture, goals and practices. These processes include identifying risks, exposures and hazards that may be relevant to your business and assessing their severity and potential for losses. Your organization may enjoy various benefits by dedicating time and resources to a thorough business risk assessment.
Why Are Annual Business Risk Assessments Important?
Performing adequate risk assessments should be considered a top priority regardless of your organization’s unique circumstances. Doing so can reap many benefits for your company, including the following:
Increased safety—Even employers operating in relatively low-risk sectors must account for risks and exposures that could lead to costly accidents and injuries. If your employees or third parties, such as guests and passersby, suffer bodily harm from an incident caused by your operations, it could lead to significant losses.
- Legal compliance—In many cases, your organization may be accountable to the Management of Health and Safety at Work Regulations 1999, which mandates identifying and controlling workplace risks and hazards. Depending on your situation, other laws and industry standards may also apply.
- Greater financial security—Accidents, errors and other unexpected situations can disrupt your business operations, damage your reputation and lead to costly lawsuits. By identifying risks ahead of time and implementing appropriate loss control measures, you can minimize the financial consequences of incidents and reduce their likelihood of occurring in the first place.
- Better employee health and well-being—In a safer workplace, your employees are less likely to be injured on the job or develop work-related health conditions. This not only reduces potential workers’ compensation claims but also can limit absences while improving employees’ productivity and morale.
- Reduced insurance costs—Conducting regular risk assessments can make insurance companies feel more comfortable covering your organization. By identifying risks and implementing various solutions and safety measures, you can reduce your premiums and reallocate essential funds toward other goals and needs.
We’re Here to Help
With nearly 30 years of experience serving employers, the dedicated staff at Beckworth Beneficial is well-equipped to help your organization understand the importance of annual business risk assessments and conduct them appropriately. Contact us today to learn more.
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.