As a Houston native, the recent tragedies brought on by Hurricane Harvey are very personal to me. While I think about the devastation my friends and family are going through in Southeast Texas, I am aware that an important part of the healing process is recovery. Once everyone is safe they will need to get back to work, if at all possible. Companies, as well as individuals, will move into the recovery phase.
With all of this on my mind, it seemed like the right time to share critical information about moving forward after the storm.
While we acknowledge how damaging this storm continues to be, it is okay to talk about how trained financial experts can help those impacted companies recover some of their losses through preparing business interruption insurance claims. In fact, it is an important part of the recovery process
Business interruption insurance is typically part of a broader commercial insurance policy that provides limited coverage for an operational shutdown due to physical property damage, either to that company, or other damage that prevents access by customers or employees. Depending on the policy, business interruption claims can include the company’s actual loss of business income, as well as necessary extra expenses incurred during the business restoration period. In the case of Hurricane Harvey, assuming that a company has determined its losses should be covered by either their commercial insurance policy or excess flood insurance policy, the company will need to submit a claim to their respective carrier.
Claims for lost business income and extra expenses must be based on credible, reliable and consistent documentation and representations. These claims will be subject to a rigorous review by the insurance carrier’s adjusters, typically financial experts trained in how economic lost profits analyses should be prepared. As such, the impacted company would be greatly served by having an independent financial expert, trained in both economic lost profit calculations and forensic investigations, prepare, or at least review, its business interruption insurance claims.
If your clients have any operations within harm’s way, and may have questions as to how best to document and support a business interruption claim, we are available to answer your questions.