Recovering quickly after a computer disaster

Suppose you open your doors for business one morning only to discover that water damage from heavy rains the night before has shorted out your computer equipment, leaving your automated systems inoperative. Or, perhaps, an overnight power failure has wiped out a large portion of your critical electronic records. Without warning, your entire business operation could be in jeopardy. Fortunately, this type of disaster needn’t be a major setback for your company. By taking the right steps now, you can get yourself “up and running” with minimal delay.

1.     Insure yourself against electronic data processing losses. Standard commercial insurance packages don’t cover some losses relating to computers and other electronic equipment. Electronic data processing (EDP) insurance is specifically designed to fill this gap. EDP coverage generally covers your electronic data processing equipment, all your computer data, and the disks or tapes on which it is stored, as well as additional costs necessary to continue normal business operations after a disaster. It also covers any lost business income due to the disaster. EDP insurance may include protection against a wide range of threats including damage from water or other liquids, rust, corrosion, mechanical breakdowns, changes in temperature and humidity, power fluctuations, sewer backups, theft, vandalism, and earthquakes.

2.     Back up your systems regularly. From customer records to accounts receivable and payable, your company undoubtedly relies on a vast store of electronic data. If this information were lost, it could be expensive and time-consuming—and, in some cases, impossible—to recreate. Make it a practice to back up your critical data nightly and to store the backup data in a safe, offsite location. It’s also a good idea to keep a second backup copy from the previous day.

3.     Practice recovery drills. Even if you have the foresight and commitment to back up your systems on a regular basis, how quickly could you get your computers up and running if disaster strikes? Do you know exactly how to restore the data? Are you sure the tape drive you use for backups is still compatible with your system and is not outdated? The best way to answer these questions is to run a practice drill occasionally. This will confirm your backup tapes are free of defects, and that you are indeed able to respond quickly in a true emergency.

In today’s competitive business environment you can’t afford to lose one day to a computer shutdown. If you are unable to service your customers’ needs, your competition will be happy to do so. Businesses that plan ahead are are in the best position to keep disruption to a minimum. Following these steps can help get your company “up and running” quickly if disaster strikes. Give us a call today for more information on EDP coverage.

Risk Manager Online Vol. 16 No. 3 Copyright © 2008 Liberty Publishing, Inc.