I am sitting here at my sister in law’s house in Woodbury, Long Island essentially homeless. Our home in Port Washington, NY is in fine shape, but the local authorities do not expect to restore the essential services for another week.
My office located a couple of blocks from Ground Zero has lost electric and phone service. The MTA is still working diligently to restore subway service into downtown Manhattan. Frankenstorm Sandy has created quite a stir. Thankfully, my office is set up through the “cloud.” Client files are scanned and accessible. Even though Cablevision has not restored internet access, I am able to work via my iPhone LTE hotspot.
I hope that you and your family are doing well considering these difficult circumstances.
The big issue is not whether, but where and when you will confront the next natural disaster. Careful and proactive attention to insurance coverage is vital to restoring your business and dealing with the financial storm that almost always follows the natural disaster.
Losses will arise not only from the direct damage or destruction of your property, but also from the interruption of business resulting from:
- Property damage;
- Business interruption caused by damage to the property of important suppliers, customers and other business partners;
- Extra expenses incurred to resume normal operations;
- Lack of access to your business due to damage to buildings, roads, subway, et. al.;
- Other circumstances depending on what type of business you are involved in.
It is important for you to review all relevant insurance policies as soon as possible. Many policies have strict deadlines regarding notification dates. The time is now to prepare detailed loss information.
The following checklist provides a basic lay of the land of important issues that are crucial in obtaining a payment for your claim:
ARE YOU COVERED?
Your first step is to read your insurance policy. You should look at the following provisions closely:
- Business interruption coverage. This usually covers your business loss of revenue or earnings resulting from property damage. Insurance companies usually fight tooth and nail regarding the proper amount that should be paid;
- Contingent business interruption coverage, which usually covers your business for lost earnings or revenue due to property damage of business partner, customer or a supplier.
- Defense coverage, which could cover you for legal costs expended if you are sued if there is damage to the property of someone else;
- Other provisions you should pay close attention to include civil authority, claim preparation, excess, extra expense and ingress and egress.
You next need to present your claim to your insurance company. Failure to comply with the specific procedures can result in denial of your claim. A client recently reached out to me because she was denied business interruption coverage because she failed to properly document her claim. Ouch!
Feel free to contact my office to assist you in reviewing the strength of your potential claim, in dealing with notoriously stingy claim adjusters and in getting the most for your potential insurance recovery.