With the spring showers and summer heat fast approaching, it’s time to be prepared for hurricane season. Several large tropical storms hit in 2016, which could indicate a busy season ahead.
Prepare now by having a plan whether that includes evacuating or waiting out the storm. Stay prepared by reviewing your insurance policies and keeping them in an easily accessible place. Learn how to deal with water damage and property loss in case you are caught in the thick of it.
Dealing with Indirect Loss
Direct Damage refers to tangible damage to property (i.e. fire damage to a building) and is typically immediately seen. From direct damage, indirect losses can follow and can include loss of business income, loss of utilities and spoiled food.
The amount of an indirect loss can often be greater than the direct damage loss. Buildings with power may lose clients due to their inability to access critical materials or a necessary power line. Businesses can be forced to shut down for extended periods of time. Measuring indirect loss is tricky, but the results are very real. In coastal areas of the country, coverage for indirect losses can be limited so it’s always a good idea to review your policies and talk with your agent so you have a clear understanding of the coverage provided.
Covering Business Utility Services
Businesses can struggle greatly at the time of a hurricane, with unpredictable losses to power supplies and other utility services.
So, what coverage does business utility services insurance provide?
This short list can help you understand the language in which an insurance coverage plan will communicate to let you know what’s covered and what isn’t. The following definitions may come in handy:
– Water Supply Services. This refers to water mains, pumping stations, and storage units that supply the premises of a business.
– Communication Supply Services. This refers to each and every type of communication line available, including but not limited to: telephone, radio, television, and microwave power. The only major exclusion to this coverage is satellite communication.
– Power Supply Services. This almost always refers to the five major types of power that are often supplied to home and business properties. The five types of power supply services include: switching stations, generating plants, transmission lines, substations, and transformers. These can supply electricity, steam, or gas to all scheduled properties.
Need Flood Insurance?
The first thing to ask yourself when it comes to finding flood insurance is, “Do I own property that can become easily damaged by a flood?” Look around you, and think about the area in which you live. If the answer to that question is yes, it may be wise to invest in flood insurance. In coastal areas, the likelihood of experiencing a flood loss is often greater than other types of loss.
Without the proper insurance, flood losses can lead to financial disaster.
Other than Insurance: Disaster Recovery Plan
While obtaining flood insurance is the safest way to make sure you don’t suffer any losses in the event of a flood, it’s also wise to create a disaster recovery plan to further prevent any damage from occurring.
If you run a business, you may want to plan (and then test) a disaster recovery procedure to take all potential losses into effect.
Some ideas include:
– Arrange for a secondary location to be used as a temporary business headquarters in the case of disaster
– Have multiple records of everything, both paper and electronic
– Arrange for other sources of product supplies
– Maintain a backup generator for power
After you’ve established this plan, make sure to test it out to make sure it’s running smoothly. There’s nothing wrong with running a few drills to make sure that everything is done right!
Floods can be a huge threat to business and private property. Make sure you know what to do to prevent and protect yourself against floods. Hurricane season is approaching, so it’s best to be as prepared as possible in the months to come!
If you have any questions about your coverage, please contact us. We’d be happy to review your coverage.