Summertime is often the season associated with lazy sunny days sipping on cold drinks at the beach. However, for some industries such as the insurance industry, summer can be anything but a relaxing time of year. That’s because in many places in the world summer brings with it all kinds of chaotic and potentially damaging weather scenarios that can wreak havoc on local businesses.
The Atlantic hurricane season, for example, began June 1 and extends through November. In other locales, volcanic eruptions (like the recent volcanic eruption in Hawaii) to tropical storms, monsoons, flooding, fires and even tornadoes pose serious risks to homes and businesses during the summer months. When one of these weather or environmental patterns hits, devastating amounts of damage and destruction can be left in its wake with severe financial consequences.
Businesses can be particularly vulnerable to disastrous weather or environmental catastrophes because they are at risk from being doubly affected. On the one hand, the physical property or structure of the business may be entirely destroyed or severely damaged which can incur steep expenses. Additionally, while the repair or rebuilding process is taking place, the damaged business suffers again financially and in other ways from losses due to an interruption in its regular operations.
For businesses hit by catastrophic weather or natural disasters this can be too much too handle. Fortunately, the businesses that are prepared in advance with the right type and adequate amounts of insurance coverage can usually weather the storm. Insurance policies that can cover both the physical property damage as well as the loss of revenue that results from an interruption in business operations can be life saving to businesses in need.
The physical damage resulting from destructive weather or environmental factors should be covered under all-risk policies. However, as always, it is crucial to confirm that there are not any specific exclusions that would prevent your business from receiving coverage. In addition, more specific types of coverage may be necessary and available as well depending on the circumstances.
Insurance to cover loss of profits due to an interruption in business operations would also cover ongoing expenses such as salaries, mortgage or rental payments, and loan expenses. As always, policy language is crucial, so every policy should be double checked to make sure it provides the right type and the right amount of coverage for the ultimate protection in case of disaster.