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Protecting your business in the case of a natural disaster

The southeast, much like many regions of the U.S., took some hard hits from Mother Nature in 2017.

The Wall Street Journal reported that “Hail, tornadoes and an ice storm turned the first three months of 2017 into the most expensive quarter in more than 20 years for U.S. insurers.” And this was all before Hurricanes Harvey, Irma and Juan did their damage.

So, how does this affect you as a business owner? Besides the chance to lose your physical premise to a disaster, your business is crucial to the economy in which you live. Not to mention critical to your livelihood and your employees’ as well. If you don’t have the right policy in place you may want to reconsider.

A majority (68%) of small-business owners have no written disaster recovery plan. Despite nearly half those surveyed said it would take their business around three months to recover from a natural disaster.

Let alone not even having a plan, another survey shows 71 percent of small businesses don’t have business interruption insurance.

But a business interruption policy alone isn’t always enough. For example:

“Imagine an extreme weather event plows through a small town yet misses a small business. The storm, however, knocked out the area’s electrical grid for two or three weeks. Insurance policies only cover direct physical loss. So, a policy or endorsement that provides coverage for a power outage away from the premises would have been a wise choice .”

Having a Business Interruption Policy is a must, however, it won’t cover losses your business sustains from a utility interruption, which can result from events occurring off your premises, such as a wind storm, water main break or gas leak.

There are two business interruption/utilities interruption endorsements you can add to your existing commercial policies.

Off Premises Business Interruption

This endorsement is an extension of basic business interruption insurance and covers you in the example mentioned above. This will cover your losses, including loss of income and expenses, up to a predetermined time limit or until the utility service is restored.

Direct Damage

This endorsement is an extension of your property insurance. It provides protection against direct damage to your property resulting from an interruption due to a covered cause of loss.

Either way, in the unfortunate event that some type of direct or even passive damage occurs to your facilities or to your utilities, you would be covered—and that’s what we want for you.

If you have any questions about a utilities interruption endorsement or any insurance needs, give us a call!

You can reach us at 334-263-5535 or click here for a quote!