The concern about bird flu highlights the importance for businesses of preparing for an influenza pandemic, says Martin Dockrill

Since the H5N1 virus resurfaced in late 2003, it has killed at least 63 of the 124 people that it infected in Asia, mainly amongst people who lived close to poultry in Indonesia, Vietnam, Thailand and Cambodia. As there is no immunity amongst humans to the H5 part of the avian flu virus, there is an increasing unease over the recent spread of the virus to bird populations in China, Russia and Eastern Europe as more outbreaks of the virus increase the chances that this particular avian flu virus could eventually transmit itself from "human to human" on a sustained basis.

Once this occurs we will probably face a pandemic, that is to say, the effects of a disease that can affect not only some 25% of the globe but cause "high morbidity, excess mortality and social and economic disruption".

There are few defences against such conditions. To be truly effective, vaccines can only be developed once the pandemic starts. New anti-viral drugs such as Tamiflu offer only limited protection as well as being difficult to make.

The World Health Organisation (WHO), the Food & Agriculture Organisation, the World Organisation for Animal Health and the World Bank are taking the risk seriously, recently holding meetings in Geneva to provide a global assessment of the situation and develop preparations for a possible human flu pandemic. The World Bank has also just announced that a pandemic could easily cost the global economy up to $800bn (£458bn).


Healthcare company Roche has already agreed to donate enough Tamiflu to WHO to treat some three million people and help stop the spread if the virus begins a sustainable "human to human" transmission. The European Commission has announced its own plans to assist Asian countries to tackle the spread of the disease (as has Australia and America). In the face of such activity from the diplomatic and medical community, it is surprising that few businesses have thought about their own preparation. Success against SARS in 2003 should offer little comfort. The financial and economic toll of SARS was in the range of $60bn in Asia alone, yet that virus was not as contagious or as virulent as influenza.

Other than life assurance and sickness cover, insurance markets currently offer little or no coverage for loss of business as a result of a pandemic.

Property and marine policies where business interruption and extra expense coverages are typically found exclude losses resulting from damage due to the spread of infectious diseases. Despite this, businesses could easily face a multitude of problems if a pandemic arose, such as loss of income, cash flow problems as employees are sick or care for sick family members, fuel shortages, quarantines that prevent employees from travelling to work and shutdowns in import and export.


Given the lack of insurance coverage, it is imperative that businesses adequately identify their risks resulting from a flu pandemic and ensure that they have a flexible continuity plan. This plan should deal with and follow the changing stages of a pandemic as determined by the WHO, which are:

- Inter-pandemic stage - identification of a new virus, infection of more than one person and sustainability;

- Pandemic stage - WHO continues inspection of cases so it can assess the start of any pandemic; and

- Regional and multi-regional epidemics - use of anti-virals and quarantines will hopefully limit the spread, travel will be curtailed and the import and export of goods will slow down.

By analysing the risk and considering the stages of a pandemic a company can then evaluate the implications of the disease and additional resources to deal with the issues:

- Knowing the trigger point - when to take action;

- Monitoring and reporting possible cases to health authorities;

- Restrictions on travel, for instance enabling employees to work at home if possible;

- Maintaining customer contact - how to continue this and protect employees;

- Complying with governmental measures and legal guidelines;

- Protecting key people and building systems such as ventilation systems, hygiene, etc;

- Continuously testing and re-testing the contingency plan; and

- Assessing the cost of expert assistance, such as business continuity specialists, health, building specialists, etc.

During a pandemic, businesses should continue to monitor the global situation as pandemics often come in a number of waves, some of which in the past have not only been more virulent than the first but also affected other places. Unfortunately, as it is difficult to project how long or virulent waves will be, until the WHO declares the end of a pandemic, businesses should be ready to face the direct and indirect economic effects of any possible future waves.

Businesses, like governments, may be unsure if the H5N1 virus will even evolve into a pandemic (or even if it does, whether it will be as catastrophic as some in the past) but no business can afford to do nothing. The H5N1 virus is now spreading to other animals besides birds, lasting longer and affecting people outside farming communities. The greater opportunity for the virus to spread means an increased chance the virus will transmit from human to human on a sustained basis. However, of equal concern, is the possibility the virus is becoming more virulent. It is affecting people other than the younger or older members of communities and is attacking parts of the body other than the lungs.

If businesses plan for the threat of a pandemic now and include an element of flexibility they will surely have an increased chance of reaping the rewards in the event of an outbreak by ensuring continuity of their operations.

- Martin Dockrill is a technical integrator of Aon Risk Services Division.