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I remember when one of my children had their one and only accident (thus far – knock on wood) and they called me to inform me. I was expecting a nervous and fearful teen, probably in tears trying to explain me the situation. Surprisingly, it was all the opposite. A calmed, assertive teen, letting me know what had happened, assuring me everyone was ok, and the process they had followed to a T. We had the conversations and process before my children were allowed to get into a car and start driving. Is it any different when it comes to filing Business Insurance Claims? There are many issues that can cause setbacks for businesses. Electrical fires can damage inventory and equipment as well as shut down a business temporarily. Customer injuries can lead to lawsuits, natural disasters can destroy property and burglaries can result in thousands of dollars of losses in equipment and valuables. After any of the above events you'll have to file a claim with your insurer. But if you aren't prepared, take too long to file your claim or fail to document all of your losses, you may not receive a full claims payout. You can avoid that by following these tips (or have processes in place): Gather all Information - Before you file a claim, you have to first understand what happened, because the insurer and your claims adjuster will need detailed accounts of the event and circumstances leading up to it. Look at the insurance policy to see if there are any other necessary steps to take. Some policies include instructions about what to do if certain types of insurable losses occur. Don't procrastinate during this time. It's important that you quickly collect and document all the pertinent information. File your claim with your insurance company - The most efficient way to get your claim started is by contacting the insurance carrier directly. The best way to get the claim underway is by visiting your carrier's website and going through their claims process. Many offer a convenient online method, but also provide an 800 number to call if you prefer to speak to someone one-on-one. Whether you do it online or over the phone, you will be walked through the claims intake process. Be prepared to provide the information you gathered in the first step because your insurance company will need to know all the details about what and when it happened to properly assess your claim. Most insurers will contact you within 24 to 48 hours after you file your claim. Inform US of the claim - Once your claim has been started, it's now time to inform us, your insurance agent. In addition to answering any questions, we can explain your coverage and properly set expectations for what's to come. Additionally, if your claim has any complexity or nuance, we will be able to work with the carrier and/or provide useful advice and guidance. Create an inventory of losses - While you wait for the claims adjuster to contact you or for them to come out to assess the damage, you can work on creating an inventory of your losses. This is essential for providing a clear picture of the loss or damage. Include descriptions of items, their original values and estimated current values. It is also helpful to include a description about the condition of the item before it was damaged. If it is possible to photograph the damaged items, take photos for the insurer. Find copies of any receipts for damaged items. It is also helpful to do a walk-through of the damaged area with a video camera or a cell phone video camera. Videos help show the damage live and from multiple angles. Use them to supplement photo files. Show proof of the loss - Insurers require policyholders to sign sworn statements that show proof of their losses, and the required information must be sent along with the statement. This statement must be made and signed within 60 days of the insurer's first request for it. Make temporary repairs if needed - If temporary repairs must be made to prevent further damage or to protect other assets, they can be completed before the adjuster surveys the property. Do not order any unnecessary repairs. The only types of temporary repairs that should be made are those that will prevent further damage or prevent a possible liability. For example, a temporary roof repair may be necessary to prevent it from collapsing and injuring people, or a broken window may be fixed to prevent rain from coming into a building and causing water damage. Since repairs are included in the settlement, keep receipts for any services and items purchased. For contracted work, obtain two written bids from separate companies before hiring someone. The takeaway - Always stay organized when going through the claims process. Have a process – in writing -- Keep all papers accessible and have information ready in the event that an agent or adjuster calls. When talking to any repair companies or other related parties on the phone, keep track of calls and the reason for the calls. Save receipts for any items that are purchased in relation to the damage. To learn more about what to do during the claims process, give us a call.
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A new survey has found that cyber risks have risen to become the number one concern among businesses, replacing the COVID-19 pandemic and business interruption as the top risks in 2022. The second-most cited risk was business interruption and supply chain disruptions, followed by natural catastrophes, according to the "Allianz Risk Barometer 2022." The rankings follow a year that saw an explosion in cyber attacks, massive business interruption and supply chain disruptions that have left factories idle and store shelves bare, and record damage caused by natural catastrophes. This annual survey provides perspective on the number and variety of threats businesses face, and which ones are causing the biggest headaches. Here are the rankings of the top eight risk cited by risk managers in the Allianz survey: 1. Cyber risks — Ransomware has become the number one cyber exposure for business, according to the barometer, just ahead of data breaches. Cyber criminals have refined their business models and tactics, which has made it easier for them to carry out ransomware attacks. Hackers have also started targeting technology and software supply chains, physical critical infrastructure or digital single points of failure. 2. Business interruption — The COVID-19 pandemic has caused the greatest global supply chain disruption in history, which in turn can lead to business interruption, particularly for manufacturers unable to secure much-needed parts. The supply chain has been disrupted by a number of factors, including pandemic-induced port closures in China, port congestion and factory closures. The biggest supply chain concern is cyber attacks on infrastructure and on supply chain and logistics technology. 3. Natural catastrophes — In 2021, the U.S. experienced 20 separate billion-dollar weather and climate disasters, putting it in second place for the most disasters in a calendar year, behind the record 22 billion-dollar events in 2020. 4. COVID-19 pandemic — Pandemic risk dropped from the number two spot in the 2021 rankings as businesses have become more confident in their contingency plans and safety protocols. "Many companies are taking advantage of the increased awareness of business interruption, and we have seen more organizations investing in tools and systems to improve transparency of supply chains, work through scenarios and update their business continuity," said Philip Beblo, global property industry lead for Allianz. 5. Regulatory and legal changes — Under the Biden administration, there's been an uptick in regulatory activity, including workplace safety standards for protecting workers against COVID-19 infection. There are also new state laws and regulations that require businesses to make operational and organizational changes to comply. 6. Climate change — The U.S. continues to see increases in the frequency and intensity of storms, wildfires and tornadoes, which are causing more expensive property damage, business interruption and insured losses. "The risks to businesses from global warming are being experienced with increasing force and immediacy — as direct damage after extreme weather events, but also leading to tightening regulation, and as threats to brand and reputation," said Line Hestvik, chief sustainability officer at Allianz. 7. Fires and explosions — Fires (excluding wildfires) and explosions caused in excess of $15 billion worth of damage globally between 2013 and 2018, according to an Allianz analysis of 470,000 insurance industry claims during the period. Besides property damage, a major fire or explosion can prevent companies from operating for some time and such incidents are the most frequent drivers of business interruption insurance claims. 8. Shortage of skilled workers — Another issue that the pandemic has exacerbated is the skilled worker shortage. Nearly seven in 10 companies reported talent shortages — the highest in 15 years, according to a ManpowerGroup survey. As the economy has reopened in the wake of business closures during the start of the pandemic, companies in most sectors have had trouble finding new staff and hanging on to valued employees as competition for talent is fierce. COVID-19 is forcing businesses to face a number of risks, liability and insurance implications. Companies could seek coverage for a variety of claims stemming from the outbreak, including workers' compensation, business interruption, liability and more. And, now that it is a pandemic, the economic fallout may be expansive - hitting your company's operations in the form of lower sales or supply chain disruptions. Now is a good time to understand which of your insurance policies could come into play. Workers' compensation Workers' compensation policies generally extend insurance benefits to employees for injuries and illnesses "arising out of or in the course of employment." That wording makes it difficult for most workers to file a claim if they suspect that they got the coronavirus at work, presumably from another employee, customer or visitor to the workplace. But if an employer knows that the virus is in the workplace, coverage could apply. Workers' compensation could come into play in the following instances:
However, workers' comp insurance would likely not cover employees who are working on assignment abroad for more than a short time. Business interruption One major fallout from the spread of COVID-19 is that it has cut into global supply chains, forcing manufacturers around the world to suspend production. This has been especially true for companies that rely on China for their parts and materials. But now that the virus has exploded in a number of countries, the threat to supply chains will only increase. This has already started affecting companies in the United States. If your company's operations are affected or stopped due to the virus, you may be wondering if the business interruption coverage in your property policy or business owner policy may pay out. Business interruption coverage replaces income that was lost due to a disaster, such as a fire on the premises of the company or one of its suppliers, or a hurricane that hinders a company from operating. However, any hit to your income from coronavirus would not be physical damage, which is a prerequisite for this coverage. Viruses and disease are typically not an insured peril unless added by endorsement. In many cases, the policy may specifically exclude coverage for viruses and disease. There is potential coverage through communicable disease coverage under proprietary insurance carrier forms if the insured is closed by a "public health authority" order for closure, decontamination, etc. But it's worth noting that these usually require the order to happen, so the insured cannot voluntarily decide to close and then claim coverage. General liability In terms of liability, a third party - customer, vendor or guest - could claim they were sickened on your property and sue your business for negligence for failing to provide a clean facility, which could trigger your commercial general liability policy. Any company that deals with the public or customers, like a retailer, restaurant, hotel, daycare center or a gym, would be at greatest risk for this type of action. While the chances of them winning such a case would be small, you could still face legal bills, which your CGL policy would typically cover. If there is coverage, it would come under the policy's "bodily injury" portion. Some CGL policies exclude claims arising from a pandemic, virus or bacteria, so read your policy carefully. Many insurers also include broadly worded pollution exclusions that could preclude or limit coverage. Business travel accident insurance This insurance could cover employees who travel on business domestically or internationally, foreign employees of U.S.-based businesses and U.S. employees on offshore assignments. The insurance provides:
One of the keys to managing risks when you first start a business is getting the right insurance to cover your operations, property and potential liabilities.
Unfortunately, many business owners fail to update their policies and just renew them year after year even if the company has grown, expanded operations and facilities, and added new equipment and property. If this is the case, the old coverage would be insufficient. Business owners should review their policies every year to catch any omissions and make sure they are not underinsured. It is common for smaller businesses to secure a basic business owner's policy (BOP) and workers' comp when they first get started. A BOP includes:
Outgrowing BOP coverage As your business expands, you may outgrow the BOP and need additional coverage to manage your risks. Some examples include the following:
Depending on the business, some or most of these insurance options may be required for adequate protection. Annual reviews with us are ideal for discussing your options. Make sure these elements are considered:
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