Talk to your insurance agent about different insurance options. Insurance coverage is available for every conceivable risk your business might face. Cost and amount of coverage of policies vary among insurers. You should discuss your specific business risks and the types of insurance available with your insurance agent or broker. Your agency can advise you on the exact types of insurance you should consider purchasing.

• Basic overview of business insurance from the SBA

Assess your insurance coverage on an annual basis. 

• Insurance policies vary – check with your agent or provider about things such as physical losses, flood coverage and business interruption.
• Understand what your policy covers and what it does not. Ask about any deductibles, if applicable.
• Consider how you will pay creditors and employees. You should also plan how you will provide for your own income.
• Find out what records your insurance provider will want to see after an emergency and store them in a safe place.
• Use this Insurance Discussion Form from Ready.gov to discuss your insurance coverage with your agent.

Dealing with Your Insurance After a Disaster or Extreme Event

Your insurance policy is a contract between you and your insurance carrier.  As the insured, you have certain duties and responsibilities in the event of a loss.

Important steps when dealing with your insurance carrier in the event that your business suffers damages and/or losses:

1. Notify you broker or insurance company that a loss has occurred, first by telephone and then follow-up in writing.
2. Make emergency and temporary repairs to mitigate further damage.
3. Prevent liability by blocking building entry of unauthorized individuals.
4. Review the insurance policy to verify the scope of the amount of coverage.
5. Establish a “disaster loss amount” to track all loss-related expenses.
6. Document your activity in a log and maintain accurate records.
7. Collect all books, records and other data (photographs, etc.) pertaining to the damaged property.
8. Contact the insurance company’s representatives to arrange for a joint inspection of damages. When you first meet with the insurance representative try to reach an agreement of the scope of the damage and loss and on a rough timetable of events to drive the adjustment process.
9. Document, in writing, all agreements with the insurance adjuster.
10. Request and advance payment on the loss from the insurance company, first verbally and then follow-up in writing.
11. Evaluate the building, contents and business interruption/ extra expense claims.
12. Quantify the building damage by preparing a diagram of the building, indicating all damaged areas.
13. Prepare a detailed estimate of the damage to business personal property pricing according to recent invoices, catalogs or knowledge of the products. To speed up the process, invite the adjuster to work with you to develop the damage estimates. It may eliminate controversy in the final stages of the adjustment.
14. For the business interruption and extra expense claims, gather information from books, records, forecasts and market analysis, and then determine the period of indemnity.

Recovery assistance programs (Note: This is not an exhaustive list)

• Disaster Assistance and Emergency Relief Program for Individuals and Businesses – Businesses in a federally-declared disaster area can deduct unreimbursed casualty losses (for property that was destroyed by a natural disaster) on tax returns (using Form 4684).
• SBA Business Disaster Loans – Provides low interest disaster loans to businesses in a declared disaster area to repair or replace real estate, personal property, machinery & equipment, inventory and business assets that have been damaged or destroyed in a declared disaster.
• SBA Economic Injury Disaster Loans – Provides loans to small businesses in a declared disaster area that experience substantial economic injury. Substantial economic injury is defined as being unable to meet obligations and to pay ordinary and necessary operating expenses.  Loans provide the necessary working capital to help small businesses survive until normal operations resume after a disaster.
• Disaster Unemployment Assistance – Provides benefit assistance to individuals whose employment or self-employment has been lost or interrupted as a direct result of a declared disaster and who are not eligible for regular unemployment insurance benefits.