Business Interruption Insurance: Part 2 (From the Experts)
I’ve stayed in touch with Abby from Licata Risk Advisors since posting our Business Interruption Insurance piece earlier this week and she just forwarded me a memo her firm released to clients. While her team has drawn some of the same conclusions I did, they rightly reiterate that this is a fluid situation with various political, legal and economic factors in play. Accordingly, they recommend that small businesses take certain steps NOW just in case there are subsequent developments that would clear the path for filing a claim under interruption insurance. We’ve pulled these steps for you here:
Stay aware of and document the following factors if, and as possible:
- Any event or contract cancellation specifically based on the virus (as stated by the cancelling party, or as implied or obvious) – keep all that correspondence, and if verbal ask for it in writing.
- Any drop in overall revenue that can be specifically attributed to the virus in some way. Keep documentation of news clippings, etc. about business reductions in your area, industry or niche.
- Plan to be able to show revenue trends over the years – for example, you may find revenue increased 15% in each of the last three years, now suddenly flat, or down.
- Document any person who has been in your building, office, facility, etc. who now has or had the virus. That would help show the building was contaminated, therefore physically damaged.
- In general be aware and document the existence and cause of any business reduction you suffer.
This information will be needed for any claim filed.
The full version of the Licata’s memo is on the Licata Risk Advisors website.