Insurance and continuity are different tools
Insurance compensates part of the financial losses after an event. Business continuity (BCM) reduces the downtime itself and helps you recover faster. They are not a replacement for each other but two layers of protection.
What insurance usually does not cover: loss of customers and market share, reputational damage, missed opportunities. And it is precisely these that often hit harder than direct losses.
Why they are used together
- BCM shortens the duration of downtime — and therefore the size of the loss itself.
- A mature continuity system and quantified risks help in negotiations with the insurer and can affect terms.
- Insurance covers the residual financial risk that continuity measures cannot eliminate.
First we assess the risk (BIA) and reduce downtime with a plan (BCP), then we insure what remains.
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FAQ
If the business is insured, do we need BCM?
Yes. Insurance compensates part of the direct losses after an event, but it does not shorten downtime or bring back lost customers. BCM reduces the damage itself, so they are used together.
Can BCM affect insurance terms?
A mature continuity system and quantified risks are an argument in negotiations with the insurer and can have a positive effect on terms.
Evgeny Telenkov
Chief Risk Officer · PhD in Economics · "Best Risk Manager of Russia 2020"
20 years in risk management. Led risk management at Beeline, Nornickel, Rosneft and EY. Built business continuity plans for Nornickel, Rostec, NSD and DIA. Trained 300+ risk and BCM specialists.