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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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Construction Firm Tips for Avoiding Insurance Disasters
When you're in the construction industry you already have lots to worry about: Keeping your workers safe in one of the most dangerous industries, uninsured or underinsured subcontractors, and finding experienced employees from a shrinking pool of talent. Not only that, but lawsuits lurk in any project, exposing you to serious losses that can threaten the survival of your business. For these reasons, it's important that you understand your insurance coverages and that you know how to address any deficiencies that may exist in your risk management strategy. To make sure that you are not left exposed, we recommend the following: Choose the right insurance company We can help you find an insurance company with the experience in writing policies in your industry and the resources to tailor coverage to your needs. Remember, some large projects and lenders require that you are covered by only an A-rated insurer. Don't buy the cheapest policy If the policy price is significantly lower than other insurers, that may be a red flag. Make sure the insurer will be covering what the project owner, your lenders and other stakeholders require. If you find out your policy is deficient after you've purchased it, you'll have to cancel it and buy a new one. There go your profits. Understand your policy All policies have exclusions and you should understand what the insurance company will cover and what it won't. We can sit down with you and review every line of your policy, including any additional insured endorsements or exclusions, so you know exactly what's covered and what isn't. Don't buy insurance you don't need We can do a thorough review of your business and its risks with your help. It's important your coverage meets your needs and that you don't carry coverage for risks you're unlikely to face. Use the correct class codes It's easy to misclassify certain employees, and if you err it can come back to haunt you. When it's time for renewal, go through your books and make sure you have job descriptions for all of your employees. Keep track of your staff so that you get it right the first time. Also, keep track of new employees that you hire (or let go) during the course of the year, so that adjustments can be made to your policy. Avoid the independent contractor trap During the last few years, the IRS, the Department of Labor and a number of state agencies across the country have been cracking down on the practice of worker misclassification. There are many implications for classifying someone who is an employee as a contractor, and all of them are costly. You could be looking at back taxes, owing additional workers' comp premiums, lawsuits, and more. Don't understate payroll If your insurer audits your business and they find that your numbers just don't add up, you could end up having to pay additional premium or risk policy cancellation. Understand how 'claims-made' coverage works "Claims-made" policies have lower up-front and ongoing costs and they only let you make a claim during the policy year during which a project is being built. The biggest drawback of these policies is that if you have to file a claim years after the project is completed, you may be out of luck, especially if you've switched insurance companies. Check your subs' insurance certificates Know whether or not your policy will cover subcontractors or if they need to carry their own liability coverage. Verify that any subcontractors you use have valid and current certificates of insurance. Keep your policies current and up to date Many factors should prompt you to revisit your insurance policy: Hiring new employees, buying new equipment or vehicles, or opening a new office. These types of changes should prompt you to review your coverage with us to ensure you stay fully protected. One of the biggest mistakes you can make if you incur damage to your business premises is to wait too long before filing the claim with your insurer. The owners of a hotel in Dallas learned this the hard way when a U.S. Circuit Court of Appeals held that the business had waited too long to file a claim with its insurer after suffering hail damage. The court ruled that because the hotel had waited more than 19 months to file the claim, it was impossible for the insurer to ascertain exactly when the damage had occurred. The hotel's property policy required that the insured make "prompt notice" of any claims. But the insurer rejected the claim when it received it for a hailstorm that had happened more than a year and a half earlier, on the grounds that it could not determine what had caused the damage or when the damage occurred. This was crucial since the policy had expired 17 months earlier - two months after the storm had allegedly damaged the hotel. Believe it or not, filing late is a common problem and it is one of many mistakes business owners make when filing claims. The following are surefire ways to risk having your claim denied or disputed by your insurance company: Not contacting your insurer immediately While most insurance policies state that you must notify the company promptly of a loss, what counts as "prompt" may be a little vague. However, you can wreck your claim by reporting a loss so late that it "prejudices" the insurance company. For the most part, you should take steps to notify your insurer as soon as possible after you become aware of a loss. Failing to document the damage Take pictures and itemize everything that was damaged. Often, you will have to make repairs immediately to prevent additional damage, or move machinery to a new location. If so, be sure to photograph the original scene to document how it was before you started your clean-up effort. Also take photos of any repairs you make. Disposing of damaged goods If your business clean-up includes removal of items such as water-damaged merchandise, flooring or insulation, keep it all, even if it has to pile up in the parking lot. The damaged materials are all evidence of the impact of the disaster on your business. Not appealing an insurer's low estimate After the claims adjuster inspects the damage, the insurance company will give you a damage estimate. If you think it's too low, you can appeal. We can help if you feel the estimate is too low. But some businesses will hire an outside adjuster to make a second estimate, and then the claim will go to mediation for a final resolution. Not reading your policy You should understand exactly what your policy covers. For the most part, commercial property policies will not cover flooding or earthquake damage. That kind of coverage will often require a separate policy or rider. Not being prepared If your business suffers damage, you'll be better off if you know what to do in advance. Some advance steps you can take are:
A final word… Filing a claim is usually not a difficult process, but you should be prepared in advance, like making sure you keep good records of all your assets, including receipts, payment schedules and more. Finally, if you are unsure whether you should file a claim on any of your commercial policies, you can always give us a call to discuss the event and we can assist you. |
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