Commercial property owners are well aware of the type of damages they can sustain to their buildings as a result of hurricanes and other major storms. The loss that you can suffer, however, is not solely limited to structural issues.
Owners of Commercial Property Need to Know Their Rights Before Disaster Strikes
That is why it is important to think about the full range of ramifications a hurricane brings with it and to understand what protections are included in your insurance policy. Some things that do not immediately come to mind in the aftermath of a major storm, like business income and professional fees, may be covered by a commercial policy.
Business Income Loss Coverage
Typical clauses for business income insurance stipulate that they will pay for the actual loss of business income you have as result of an unavoidable suspension to your business. This part of the policy often mentions a “period of restoration” that is covered and any time away must be directly related to physical property loss. That damage also has to be something that is accommodated for by the insurer.
Even with that basic understanding of business interruption insurance, there are several different types of coverage. Knowledge of these terms is particularly helpful when you want to protect your rights.
Actual loss sustained – This refers to a business income policy that covers the insured’s actual loss due to direct physical property damage by a cause that is included in the policy.
Business income – This is the net income that the insured would have earned and all operating expenses, including payroll, under regular operating procedures.
Period of restoration – This period of time includes the time it takes to rebuild, repair or replace your damaged or destroyed property. This period starts when the loss occurs and ends when the building should, with reasonable time allowed, be replaced or repaired.
There is no doubt that restoration is a time-consuming process. That may even mean that your policy period runs out before all the repairs have been finished. Fortunately, an expiration of the policy does not mean your period of restoration is over. As long as the physical loss took place when the policy was active, your business income coverage should cover the entire period of restoration window.
Professional Fees For 3rd Parties
There may be additional costs you run up as a property owner in the effort to file a claim with your insurer. These are potentially covered, at least in part, by being able to claim professional fees under your policy.
“Claim Professional Costs” are often outlined as:
- Costs associated with taking inventory and gathering and preparing other data to show the extent or total amount of damage.
- The costs for services from accountants, contractors and engineers that are also related to assessing the level of damage.
Some Insurers require you to acquire written approval in advance for any vendors you plan to use to assist with preparing your claim.
Regardless of how these factors affect your policy, Tighe PA is here to help. Request a free consultation today or give us a call at 855-LOSS-PRO (855-567-7776).