How is a Business Insurance Claim Made

Did you know that every year, thousands of businesses suffer financial hardships due to break-ins, natural disasters and equipment malfunctions? But they shouldn't have to worry because all businesses are required to have some form of insurance, right? Unfortunately, having insurance often puts risk factors of a business owner's mind, leaving him without the necessary information to properly file a claim and retain the funding to get back on his feet. In a market where people, nature, and technology are all unpredictable, it is increasingly important to follow these five steps when filing a business insurance claim.

1. Look Around for Safety Risks and Damage — You should always look for potential safety risks before entering any room that has been damaged by fire, flood, break-ins, etc. Once you have located these risks, take the necessary steps to correct them.
2. Prevent Further Damage — While most insurance agents would tell you never to move anything, if only one room has been destroyed in a flood or fire, it would be best to move all salvageable items out of the building or out of harm’s way.
3. Keep Detailed Records — Write down everything you do after the damage has been done. Write down anything you have moved, any clean-up measures you have taken, every item you have found or could not locate, everything that had to be replaced or repaired, and how much it cost. You will find, in doing this that you not only give yourself peace of mind, but you also help to speed your business insurance claim along.
4. Make an Inventory of Damaged Property — In order to receive benefits on your claim you must provide your insurance representative with the brand names, models, age, purchase price and place of purchase for every item you intend to claim. Many insurance companies require receipts for items to be claimed. This can be an extremely difficult task if you have not kept your business purchase records up-to-date. This makes it extremely important to prepare for the worst ahead of time.
5. Don't Wait Around For Disaster to Strike — If you own a business, especially if you own a small business, you shouldn't wait for something bad to happen to start gathering your information. Keep a hard copy inventory on file of all of your equipment. This inventory list should include make, model, serial number, receipts, etc. for all valuable items in your business. You should keep this list at an independent location, such as in a bank lock box, where you know it will be safe. It is also wise to keep a photographic record of everything on your inventory. While this may seem like a tedious task, you’ll be doing yourself more good than you, since a potential tax audit may require much of the same information.

Remember, while disaster may be the last thing on your mind, having business insurance can only go so far in helping to get your business back on its feet without diligent record-keeping on your part.