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Before You Submit an Insurance Claim

Understanding your business insurance is critical prior to ever submitting a claim.

Your business insurance, also known as your commercial insurance is more expensive as a rule, and much more complicated than your personal insurance.  One mistake we often see business owners make time and time again is not reading or understanding the coverage they have in place.  It’s critical to know the ins and outs (often referred to as exclusions) of how your policies work and what is covered.

Many business owners assume that if the building they own or lease floods, it is covered.  The same is true of a tornado or wind storm.  The fact is it’s very possible none of these may be covered by the current property insurance you have in place.

Many policies will cover rebuilding, but what about debris removal.  In the event of a catastrophe, the debris removal could run into tens of thousands of dollars, even more.  Not understanding your insurance and how it works in the event of a catastrophe can lead to financial ruin for a business.

Another assumption business owners make is not about the insurance, but the down time involved in the event of a disaster.  Especially if other locations may have the similar damage and issues, rebuilding could take months or even a year or more.  Don’t make this costly assumption and overlook business interruption insurance.

Sit down with a contractor and determine how long a renovation or rebuild would take.  You must also consider the time if multiple businesses may also be in need of renovation or repair as a result of an area wide disaster.

Still another assumption by business owners is their equipment will operate without ever breaking down.  Some also mistakenly think this may be covered in their business property insurance.  Mechanical breakdown insurance, sometimes known as boiler and machinery insurance will cover these costly repairs or replacements.  In the event your business uses specialized equipment or often is held to deadlines, this insurance must be considered.

There are many more assumptions made by business owners every day that put their businesses at high levels of risk.  Assuming your general liability coverage may be enough is one.  Often professional liability insurance is needed to supplement that coverage, or perhaps even a commercial umbrella policy which would kick in after other limits are met.  Never assume it won’t happen to you, it can and it will.  No one ever believes it when an event takes place, but they always breathe easier knowing the proper coverage is there when it does.

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Take the time to sit down with your licensed insurance professional and review your personal list of assumptions.  Never assume, always know what is in place for your business insurance.