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3 Tips for a Successful Business Interruption Claim

Category 3 Hurricane Florence is set to hit the Carolinas within the next two days, with Federal Emergency Management Agency Associate Administrator Jeff Byard calling it “a Mike Tyson punch to the Carolina coast”. Real estate data provider CoreLogic estimates that the hurricane could cost more than $170 billion in property damage.

If property damage results in the suspension of your organizational operations and may result in a Business Interruption Claim, use the checklist below as you manage the claim with your independent agent and claims adjuster.

1) Document all expenses you incur as a result of the loss, which may include:

  • Payroll for employees who assist in the cleanup and repair process
  • Overtime wages paid that are necessary to minimize or eliminate the loss of business
  • Additional lease expense for a suitable temporary location in order to continue operations
  • Expenses incurred to provide suitable power, communication and other utilities to the temporary space
  • Purchase of equipment necessary to continue operations
  • Loss of any contracts due to the suspension of operations

2) Document all expenses you continue to incur during the suspension of your operations, such as:

  • Continued payroll required to retain key employees
  • Insurance expenses: employee benefits, auto and general liability
  • Taxes
  • Utilities
  • Advertising

3) Document any business you have lost as a result to the damage to your property. This may include:

  • Cancelled orders
  • Declined orders
  • Loss of rental income

To successfully navigate the property claims process, you must work closely with your independent insurance agent and the insurance adjuster assigned by your insurance carrier. Due to the volume of claims Hurricane Florence will create, it may take 48 hours or more until you are contacted by the claims adjuster. Insurance carriers are re-assigning additional personnel to the gulf region in order to assist with the increased volume of claims.

The damage caused by Hurricane Florence will have serious effects on businesses in the affected region. Documenting the expenses as a result of the loss is one way to start on the road to recovery for businesses of all sizes.

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