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Risk in Context

Be Prepared for a Stormy September

Posted by Robert W. O’Brien September 04, 2018

Although it’s been a relatively quiet Atlantic hurricane season so far, activity often picks up in September—so no business should be complacent. From 1851 through 2017, more hurricanes and tropical storms made landfall in the US in September than in any other month, according to the National Oceanic and Atmospheric Administration. Just last September, two major storms — Irma and Maria — made landfall in the mainland US and Puerto Rico. And this week, Tropical Storm Gordon has already passed South Florida on its way to an expected landfall in Louisiana or Mississippi, with several other storm systems trailing behind.

During this traditionally most active part of the hurricane season, you must be ready to protect people and properties from storms, reduce their disruptive effects, quickly manage insurance claims, and return to normal business operations.

Protect People and Property

Before any storm, make sure that employees are safe and accounted for. After the storm, be ready to help anyone who is personally affected, offering claims guidance and other humanitarian assistance as needed.

Meanwhile, look to reduce potential risks to your property and potential hazards to people. Removing standing waters before a storm can reduce the risk of ground or structural collapses. You should also disconnect equipment before a storm, which could cause or be damaged by a power outage. Once it’s safe to do so after a storm passes, remove debris, wildlife, chemicals, and other materials brought onto your property by floodwaters.

Be Ready to File a Claim

A storm claim could be complicated, so it’s important to prepare in advance. Your first step should be to review applicable policies. Make sure you understand key definitions, sublimits — including for flooding — and other relevant terms in your policies.

You should also be in touch with key members of your insurance team, including underwriters and your broker’s claims advocates. Before a storm arrives, you should already have established a clear process for gathering the information needed to file your claim. Also take the opportunity to raise any coverage issues or critical questions with this team early.

After the storm, be ready to immediately document any property damage to avoid losing information due to memory loss or employees leaving the company. Photo or video evidence can be crucial here, and can be gathered via drones or other aerial surveillance without putting employees in danger.

You should also be prepared to:

  • Capture financial losses. Consider creating a new ledger to track all loss-related expenditures. It could also be beneficial to use a unique accounting code to capture recovery-related labor costs.
  • Provide insurers with key business records, including those related to inventory, payroll, purchase orders, and operations.
  • Provide a detailed log of service interruptions, including the time, location, and reason for any interruption.

With the possibility of increased storm activity this month, it’s vital that you be ready to protect your people, operations, and bottom line. Taking these steps before and after the next storm can help you limit your damage and more quickly recover.

Robert W. O’Brien

Robert O’Brien, managing director of Marsh USA, Inc. is a senior property claims officer of Marsh’s National Property Claims practice.