INTERRUPTED BUSINESS AFTER A DAMAGING EVENT — WHAT NOW?

Addressing Your Insurance

As a business owner, you prepare as much as possible for the unexpected, including having a business resilience and emergency response plan. Here are some concrete tips to ensure you are as well prepared after a damaging event, enabling you to work with your insurer and file a full and appropriate claim.

Your Insurance Policy

For the most accurate and speedy resolution of your claim, you will need to find out what coverage you really have, how it works and what the insurance company will need to do its job.

• Read your policy carefully. Your insurance broker will be able to help you with this.
• Make sure you understand the Business Interruption (BI) coverage included, the limits and deductibles attributable and how the amount of the Business Interruption loss must be calculated.
• Avoid surprises: speak with your insurer early on what is covered and what is not covered by your policy.
• Determine what the coverage period is under your insurance police and the notification deadlines and act within them.

Taking Inventory:

• Make notes about contracts or jobs you couldn’t complete, or any other lost revenue and start collecting documents to support these notes.
• Photograph damaged inventory and prepare a backup copy of inventory records at the time of the disaster. Perform an inventory count as soon as you can.
• Also prepare backups of your records (production and financial) when the incident happened and keep a separate copy for insurance purposes.
• If you dispose of items as salvage, keep records of what was disposed of and how much you were paid.

Preparing Your Claim

Preparing Your Claim Identify and collect relevant documentation to prepare / support a claim as you go along. Use an electronic folder, physical binder or set aside a box for all information related to actions taken and money spent related to getting the business back to normal. The documents should include:

• Receipts, including temporary business premises, equipment rented or bought to continue business, additional fuel costs, cleanup costs and damage repair costs.
• Monthly profit and loss statements for at least two years prior to and for the recovery period after the event
• Any prepared budgets or forecasts covering the period after the disaster (for example, information you might have provided to the bank).

Depending on the nature of loss, you might also need inventory and production records, sales transaction history and other records / supporting documents, bank statements and payroll records.

Your insurer might also appreciate a detailed description of the business, how it generates cash, what are its key success variables, main products / services and ancillary products and services.

For more information on insurance matters, contact your local MNP Advisor.