BDO Consulting Urges Businesses to Take Necessary Precautions as the 2014 Hurricane Season Begins and the Effects of El Niño Remain Largely Unknown
NEW YORK--(BUSINESS WIRE)--The 2014 hurricane season is off to a volatile start, with storms of unprecedented strength forming in the eastern Pacific. On May 25, 2014, Hurricane Amanda, a Category 4 storm that came within approximately 500 miles of Baja, California, became the most powerful Pacific hurricane on record for the month of May. The severity of Hurricane Amanda in the Pacific serves as a solemn reminder for areas of the eastern U.S. that have not yet begun to prepare. For the East Coast, a relatively mild 2013 Atlantic hurricane season allowed a brief reprieve to repair infrastructure and reopen businesses that were devastated in 2012. However, with many of the same areas still highly susceptible to significant damage from a major storm, lessons of the past loom large.
The National Oceanic and Atmospheric Agency (NOAA) recently predicted eight to 13 named storms for the 2014 Atlantic hurricane season, of which as many as six will reach hurricane classification and up to two are expected to be major events with winds exceeding 111 mph. The agency is also predicting that El Niño will develop at some point this summer, which will play a large role in determining the ultimate intensity of the hurricane season. In the case of warmer Atlantic sea surface temperatures (SSTs) and a weak El Niño, the 2014 hurricane season could be much more violent than expected.
Named storms and other forms of severe weather can damage businesses of all sizes. Employees’ safety is at risk, assets are vulnerable and companies can be displaced or even shut down entirely. Business owners and risk managers also face the prospect of navigating complex property and business interruption insurance claims.
BDO Consulting has helped hundreds of businesses prepare for unexpected catastrophes and accelerate the recovery process. Clark Schweers, Principal at BDO Consulting and head of the Forensic Insurance & Recovery (FI&R) practice, offers actions businesses can take now to better prepare for hurricane season and ensure they are equipped to deal with the uncertain aftermath of a storm.
DISASTER PREPAREDNESS TIPS
Create or update disaster recovery plans
- Consider changes in secondary or back-up locations and operations, mitigation strategies, logistic alternatives, tested employee safety and evacuation plans, critical contracts and other significant impacts to the business’s risk profile
Assess whether accounting systems can adequately capture information
to quantify and document losses, including:
- Lost orders, cancellations, decline in demand, extra expenses, property remediation and property repair
- Assess whether employees have been adequately trained to capture relevant loss data and documentation
Review insurance policies for appropriate values and coverage,
- Deductibles and self-retentions
- Coverages such as flood, contingent business interruption, extended period of indemnity, civil authority, ingress/egress, ordinary payroll, power outages and claim preparation fees
- Back-up records and other critical information in advance of a hurricane
BDO Consulting can also advise businesses coping with disaster recovery and address all aspects of the hurricane property and business interruption insurance claims process.
About BDO Consulting
BDO Consulting, a division of BDO USA, LLP, provides clients with Financial Advisory, Business Advisory and Technology Services in the U.S. and around the world, leveraging BDO’s global network of over 55,000 professionals. Having a depth of industry expertise, we provide rapid, strategic guidance in the most challenging of environments to achieve exceptional client service. For more information, please visit www.bdoconsulting.com.
BDO is the brand name for BDO USA, LLP, a U.S. professional services firm providing assurance, tax, financial advisory and consulting services to a wide range of publicly traded and privately held companies. For more than 100 years, BDO has provided quality service through the active involvement of experienced and committed professionals. The firm serves clients through 52 offices and more than 400 independent alliance firm locations nationwide. As an independent Member Firm of BDO International Limited, BDO serves multi-national clients through a global network of 1,264 offices in 144 countries.
BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms. BDO is the brand name for the BDO network and for each of the BDO Member Firms. For more information, please visit www.bdo.com.