Filing Your Business Insurance Claim in the Wake of Sandy

By Colleen S. Vallen
Special to the Legal

The past few days have been tremendously heartbreaking and overwhelming for the Northeast region. As we transition from storm to cleanup, it is clear that Hurricane Sandy has caused unprecedented damage and destruction throughout the area. My thoughts are with all those who have been affected. The road to recovery can be challenging and I want to provide some thoughts on ways to make things a little smoother for businesses that experienced a loss.

For many businesses, this will involve filing an insurance claim for property damage, extra expense and business interruption. Many businesses have obtained business interruption and extra expense insurance in addition to their commercial property coverage. In general terms, business interruption insurance protects against losses that occur because of a shutdown of a business as a result of a specific event. Extra expense coverage can provide reimbursement for additional expenditures that are incurred as a result of the event.

Understanding the insurance process will help the insured to facilitate an effective course of action. An important element in the process is to understand the insurance carrier’s expectations. A key expectation in the process relates to documentation. As the ability to generate and maintain information has grown, insurer expectations related to the level of documentation provided to support a claim have also increased. Further, the level of review of a claim has increased as the insurance market has expanded. As a result, gathering supporting documentation is an important element of claim submission.

During these early days, business owners will be pulled in many different directions. Dealing with the event plus normal business issues can be a significant challenge. However, there are some things that a business can focus on, related to documentation, that will facilitate the claim submission process. First, re-familiarize yourself with your policy. This will provide you with important information about your coverage.

Second, keep documentation, financial and correspondence, related to Hurricane Sandy separate from other documentation. On the financial side, consider setting up specific accounts in the accounting system or separate files to track these expenditures. Documents that will likely be important include, but are not limited to, financial statements, budgets/forecasts, purchase orders and invoices, general and subsidiary ledgers, correspondence and key contracts among other data. The insurance carrier will most likely require financial data both pre- and post-event in order to analyze and evaluate the business’ performance before and after the event.

Third, identify key business indicators (i.e., what drives your business) and monitor them. Make sure to track particular Hurricane Sandy-related events. For example, if you have specific customer complaints or cancellations related to Hurricane Sandy and its aftermath you want to identify and segregate these events.

In order to effectively do the above, consider identifying a team to handle the claim. Evaluate your resources – internal and external (consultants, brokers, etc.). Communication and planning among these resources will facilitate the submission of the claim as well as interactions with the insurance carrier.

Colleen S. Vallen is a partner in Citrin Cooperman Philadelphia’s valuation and forensic services group. An expert in the field of forensic and investigative accounting, she focuses her attention on forensic and fraud investigations, the preparation of financial damage analysis and litigation support. She is also highly experienced in the analysis, investigation and review of financial documents as well as case planning and management, financial and economic analysis, expert report preparation, oral presentation of findings and assistance with discovery, interrogatories and depositions. She can be reached at cvallen@citrincooperman.com or 215-545-4800.

 

Comments

[Gannons]

This is excellent and timely advice. It's also important to balance keeping a cool head when often insurers will delay hoping an insured will lose patience or even go bust with a proactive approach, ensuring that you are not seen as a soft touch by them either.

[Small Business Insurance]

Great article Collen and i agree with Gannons that after filing the claim it needs some time to process and in that one needs to be act calmly.It might gets some delay but most of the time the claim is with you at the right time.

[Kevin Johnson]

An individual could not be sure of what will happen to his or her company in time. It should be considered reasonable to acquire business insurance so the business proprietor may have something to count on just in case something happens to the company.

[Liam Manning]

I definitely agree with the comments that you need to be patient in the process. I have a friend who has been dealing with this sort of things for a while and inspired me to learn more about it. A website that helped me know more about it was http://www.insuranceexpress.ca/Automobile.html

[Walter Stevens]

Great information! Thank you very much. I've been trying to learn more about commercial insurance here in Calgary where my company is. This will be very useful. http://www.insuranceexpress.ca/Commercial.html

[Roger]

I started, not only was the plan adopted but legislation based on it was passed within a few months of the plan's submission, and began being implemented more than one year before the plan was adopted. This is half the time that was required for the Eastern Pla

[Insurance Calgary]

Thank you for sharing, Colleen. Patience is definitely the key in any insurance claim process, but especially under circumstances like this. You can bet that insurance companies get very bogged down after a natural disaster like Sandy. Even here in Calgary, insurance companies are quite busy because of all the damage that results from the snow and ice.

[Suzy Frame]

This is such a great post! Thanks so much for sharing! I really think it is great! I have been looking intobusiness insurance calgary and how it can really be helpful! From the looks of it, it seems like it could help a lot! Thanks!

[comprehensive insurance]

Thanks so much for this insightful post. I guess patience is key to dealing with any sort of insurance claim. Thanks again.

[Revelight Healthcare]

Thanks you for sharing this with us Colleen. Insurance can get so tricky i tell you

[comprehensive insurance]

cool, thanks for sharing Colleen.

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