Hurricane season started once again on June 1st. So what does this mean for your business? There are several coverages that could make or break you should the right storm hit at the right time.
Hurricane insurance coverage is provided in your property insurance. Depending on your location, your proximity to the coastline, and your carrier, you will have several different types of coverage under your policy.
All Peril – This is the most comprehensive coverage – covering everything except for what is specifically excluded in the policy.
Named Peril – Will cover ONLY what is specifically noted in the policy. It’s usually less expensive but offers little coverage.
Wind and Hail – this is the most restrictive of the three coverages and only covers damage caused by wind or hail.
All Peril, Named Peril, and Wind & Hail will all have a percentage deductible attached. It can vary from a dollar amount to a percentage amount. A deductible is the amount of loss paid by the policyholder before the insurance will begin.
Water damage is not the same as wind or storm damage. Most commercial property policies exclude coverage for losses caused by rising water. Much of the damage caused by hurricanes in coastal areas involves rising water which is not covered under most insurance policies. In cases where homes or businesses sustain concurrent wind and rising water damage, some insurers attempt to separate the covered wind damage from the uncovered rising water damage and pay what they owe. Other carriers deny the claims entirely citing the flood exclusion. It’s very important to make sure you are covered for both wind and rising water.
Business Interruption Coverage
Even if you have proper coverage under your property and flood policies, your business could be in danger. Could your business survive being closed and non-operational for 30 days or more during repair time? Most small business will find this lack of income detrimental for their business, and it causes many to close their doors. Business Interruption insurance will kick in after the 72-hour deductible period.
Make sure you are covered this hurricane season and contact your insurance advisor to go over your policies.