Commercial risk management refers to a strategy that businesses adopt in order to protect their assets, reduce liabilities, and safeguard cash flow within their organizations. These days, businesses are faced with numerous commercial-related risks that can affect their profitability, finances, and operations. Commercial risks for businesses consist of both internal and external factors which can contribute to business failure.
For starters, a commercial risk management plan helps secure business assets, which can range from intellectual property to real estate, computer equipment, and construction equipment. A good risk management plan should outline how assets can be replaced in the event of loss and how a business can stay afloat despite the loss in assets. For instance, some business owners opt to sign up for an insurance cover in order to protect their business assets. A commercial business risk management plan should minimize business exposure to liability. A good risk management plan shields a business from unexpected liability, such as a lawsuit or accident. Some of the major commercial liability risks for businesses include auto accident liability, data and cyber liability, employee injury/safety risks, and faulty product or workmanship liability. Lastly, a commercial risk management plan should protect business cash flow as it outlines a plan a business can adopt in the event of a disaster. Businesses need to have a plan to protect their enterprises from sudden loss of income due to a disaster. A good plan allows businesses to set up a preparedness strategy that will help them remain in operation.
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AuthorPaul Mozzicato of Avon, Connecticut. Archives
February 2021
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