Posted on May 17, 2014

Preparing for Disaster With Business Insurance

Being prepared for disasters can go a long way in helping business owners ready their companies for incidents that could seriously affect the bottom line. The best time to prepare is before an event happens, and business insurance provides an excellent resource if and when disaster strikes.

Having the right amount and type of commercial insurance can give companies peace of mind; however, there are important steps to take prior for disaster preparedness.


Review Coverage

Every business owner should read (or reread) their insurance policies so they can understand exactly what is covered in case of disaster. When reviewing coverage, sometimes items are discovered that should be covered but aren?t. Make it a habit each year to review coverage and see if changes are needed based on new liabilities.


Watch Out for Exclusions

Some policies contain exclusions for certain events or issues. Do not assume that the business insurance policy covers every possible event. Most standard commercial property policies exclude flood damage, earthquakes and war from coverage. Make sure to have an understanding of exclusions, and discuss coverage gaps with a professional insurance agent or broker.


Look for Financially Stable Insurer

Insurance companies should be financially stable with the ability to handle any claim that comes in especially in the event of a major disaster such as flooding, tornadoes or wildfire. The worse situation would be to think coverage is in place only to find that the insurance carrier doesn?t have enough money to pay for damage. Look at the company?s rating with AM Best that evaluates insurance companies on their financial solvency and then assigns ratings. Find out if there are any complaints listed with the attorney general or department of insurance in their domicile state.

By preparing ahead of time for potential disasters, business owners can take care of any coverage issues as they arise so that when an event occurs, their insurance protection is there when they need it.

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