5 ways businesses can prepare
for hurricane season
In recent years, properties in the United States have been hit hard by natural disasters, with the largest insured loss event occurring in 2014, according to the Rocky Mountain Insurance Information Association.
Property and casualty insurance industry catastrophes losses in the United States rose to $15.5 billion in 2014, up from 12.9 billion in 2013.
As a result, claims rose to 2.1 million in 2014, compared with 1.8 million in 2013, the association reported, citing that each year about 6 percent of homeowners file claims.
Mitigate possible losses
But homeowners aren’t the only ones who are affected by these catastrophes. As we approach this hurricane season, businesses should ensure they have an emergency preparedness plan in place in order to mitigate losses should a storm occur.
Floods can occur anywhere, anytime, with little or no warning and businesses must make preparations so that if flooding occurs after a storm, they are able to remain open, or reopen quickly after a flood disaster. This requires taking immediate steps to prevent or reduce flood damage should your business be in flood-prone areas.
Robert Grand, vice president of risk management at Cleveland, Ohio-based consulting company Cbiz Inc., said businesses have an obligation to minimize the continuation of property damage.
For example: If your roof sustains damage during a storm, and you can’t get a contractor to repair the roof before the next rainstorm, you should have a waterproof tarp placed on the roof to prevent any more water damage from occurring, he said. Expenses related to reasonable measures you take as an insured to minimize your property damage are reimbursable, he said.
Notification of loss
In case loss occurs, “Plan to call your insurance company as soon as you’re aware of experiencing property damage,” Grand said. He added that as soon as the carrier receives notification of loss, an adjuster will be assigned and scheduled to come out and begin to help with arranging for cleanup and repairs.
Grand offers five tips for businesses to prepare for flooding in the event of a hurricane:
1. Do your research ahead of time.
Know which roofing contractor or restoration company you’re going to call before the hurricane strikes.
The demand for emergency services surges after a severe windstorm, and the best options may be unavailable if you want too long to call. If you don’t have these relationships in place before a storm, you will quickly find yourself with a sub-par roofing contractor and a less-than-capable restoration company.
2. Develop an emergency response plan.
The last thing you want to deal with is what to do when you have a high expectation for a flood or all the windows are blown out of your buildings and your roof is peeled back like a sardine can. Prepare a plan ahead of time so you can react and activate your catastrophic response team as soon as the wind leaves town.
Take extra care if your business has any exposures to chemicals or pollutants and never forget to include pre-planning options to safely relocate the chemicals or pollutants to avoid property damage and bodily injuries that can result from an environmental impairment event.
Invest in a generator?
You may want to invest in a generator so you can prevent power interruptions.
Seasonally, promote best practices about emergency response planning with your tenants to minimize their risk of going out of business and leaving you with loss of rents.
3. Keep your insurance policies in a safe place.
In case of an emergency, immediately notify your insurance broker or insurance company and provide them as much detailed information as possible.
Large catastrophes will generate tens of thousands of claims, so communication is vital for a quick resolution to your claim. Photograph damaged areas prior to making temporary repairs. Doing so will strengthen your claim and help with the best presentation of your loss.
4. Don’t sign restoration or repair contracts without talking to the insurance company adjuster first.
Your adjuster can play a key role in helping you avoid price gouging after a catastrophe, but he/she won’t be able to negotiate a reasonable price for services if you’ve already signed a contract. Remember, your insurance company is NOT bound by the contracts you sign.
5. Organize your records.
Prepare an inventory of damaged or destroyed property for the adjuster and keep a copy for your records.
Do not discard any items before the adjuster is given a reasonable amount of time to inspect them. Provide available cancelled checks, invoices, etc. that support the value of damaged or destroyed property.
Keep all receipts and invoices for every expense you incur after the loss, including items such as tarps, boards, cleaning supplies, etc. These costs add up quickly and may help erode your deductible.