When a natural disaster strikes, your business is at risk. With the right commercial insurance coverage, you can protect your property, employees, and bottom line. While we can’t prevent wildfires, floods, or hurricanes, we can make sure you’re prepared. Here’s a lighthearted guide to what kind of insurance you need, what to avoid during a disaster, and what steps to take once the storm has passed.
The Essentials: Commercial Insurance You’ll Need
Running a business isn’t easy, and natural disasters definitely don’t make it any easier. But the right coverage can save you from a world of headaches. Here’s what to look for:
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Commercial Property Insurance: This is the core coverage that protects your physical assets, including your building, inventory, and equipment. If a disaster like a fire, tornado, or storm hits, this coverage can help you repair or replace damaged property. Keep in mind, though, that flood damage usually isn’t covered under standard commercial property policies—so if you’re in a flood-prone area, you’ll want to add flood insurance to the mix.
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Business Interruption Insurance: If your business operations come to a halt because of a disaster, business interruption insurance can help cover lost income and ongoing expenses. This is especially important if you rely on foot traffic or specific locations to make a living. Let’s face it, the last thing you want after a disaster is to worry about payroll while you’re still sorting out the mess.
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General Liability Insurance: If your business operates in a way that could result in injury or damage to a third party (like customers or vendors), general liability insurance is essential. This helps cover legal costs or settlements if someone files a claim against you due to the disaster. So if, say, a tree falls on a customer’s car while they’re parked at your store, you’ll be glad to have this coverage.
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Workers’ Compensation: If the disaster leads to injuries on the job, workers’ compensation insurance steps in. It’s typically required by law, but it’s still important to remember that it covers medical expenses and lost wages for employees hurt on the job.
What NOT to Do
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Wait Until It’s Too Late: You don’t want to be scrambling for coverage when the storm is already on the horizon. Make sure you have the right insurance policies before disaster strikes. It’s kind of like buying flood insurance after your office building is underwater—too little, too late!
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Neglect the Fine Print: Don’t assume that your commercial property insurance covers everything. Many policies don’t automatically include things like floods or earthquakes, and you’ll need separate coverage for those. Always read the fine print and ensure your coverage fits your business needs. There may even be limitations for wildfires written into your policy. Take the time to ask questions and work with a trusted advisor to go over the fine print.
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Ignore Evacuation Plans or Safety Protocols: If the authorities issue an evacuation order, don’t wait around thinking you can ride out the storm. Get your employees out safely and follow your disaster plan. This will help minimize injuries and keep your business from facing even more trouble down the road. The last thing you want is a lawsuit from employees claiming you endangered their safety by not evacuating in time.
What to Do After the Storm Has Passed
Once the storm is over and the cleanup begins, it’s time to focus on getting your business back on track:
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Assess the Damage: Walk through your property and take detailed notes on the damage. Snap photos or videos of everything—your insurance company will need this info to process your claim. The more documentation you have, the smoother the process will be. Be descriptive of your lost items as well. For example, instead of listing “laptop” make sure to put “2024 MacBook Pro with 256GB of storage”.
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Contact Your Insurance Company: Now’s the time to reach out to your insurance provider and file a claim. Have all your documentation ready, and don’t forget to list any temporary repairs or emergency expenses you incurred to prevent further damage. Insurers are likely to be busy after a disaster, so the sooner you contact them, the faster you’ll get the ball rolling.
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Make Temporary Repairs: If there’s any damage to your property, make sure to secure the area and prevent further destruction. You may need to board up windows or tarp the roof. Keep your receipts for these repairs, as they may be reimbursed by your insurance.
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Stay Calm and Organized: Insurance claims after a disaster can take time to process, but keep your cool. Make sure your employees are safe and supported, and keep them in the loop about the recovery process. If your business is temporarily closed, keep customers informed through social media or your website.
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Start Planning for the Future: After the dust settles, take a moment to review your disaster plan. Are you as prepared as you could be for the next event? Consider making adjustments to your coverage or creating more robust emergency protocols to help your business recover faster next time.
While we can’t predict when disaster will strike, being proactive with your commercial insurance and safety plans can make all the difference. So, get your policies in place, stay safe, and remember—everything’s going to be okay. Your business is built to weather the storm, both literally and figuratively!
