Filing a business insurance claim can be overwhelming. First, you have to deal with the incident occurring while also handling an intense claim process. If something happened to your business, it’s important to consider all your options and review your insurance policy thoroughly before contacting your insurance provider.
7 Steps to Follow When Filing a Business Insurance Claim
One of the most stressful and frustrating situations as a small business owner is dealing with a situation that was out of your control and has now affected your business. A business insurance claim can be filed when a small business experiences some type of loss because of an accident, damage, crime or liability. Filing an insurance claim will allow you to help cover some of the financial losses you’ve incurred.
Most business insurance offers coverage for common risk factors associated with your business’ unique industry and hazards. However, several different types of insurance policies may be needed to file a commercial insurance claim, including commercial property, general liability insurance, commercial auto insurance and workers compensation.
Having the ability and knowledge on how to file a business insurance claim properly and quickly can help you to get back your necessary repairs or replacements as soon as possible. When something happens and you need to file a claim, your business suffers, so if you know what to do, your business will suffer less than it needs to. The steps to file an insurance claim for your business follow.
Step 1: Make a Plan
The most important part of making a plan to file a claim is reading and understanding your business insurance policy. If you haven’t read it yet, that is the first step. No one wishes for something to happen to their business, but that doesn’t mean you shouldn’t be prepared. Know the ins and outs of the policy so you know what is covered if an incident does occur.
Even if you don’t need to file a business insurance claim now, it’s smart to still have a plan in place in case something happens in the future. Your plan should work to make the filing process quicker and easier. You may also want to install surveillance equipment on your business property, as this will make the next step (collecting evidence) much easier. Be sure that your employees know how to use and monitor your surveillance equipment if you decide to install it.
Step 2: Collect Evidence
If a disaster occurs, you should have a plan in place, meaning you’ll know what the next steps are. One of these steps is to gather evidence of what happened to hand over to the insurance company. You should take photos or gather footage from surveillance equipment right after the disaster occurs to document the property damage. Take an inventory of all destroyed or damaged items so your insurance provider knows how much they’ll need to pay out. You can also record witness’s testimonies if there are any. This evidence must be passed onto the insurance company and your adjuster.
Step 3: File a Police Report
It’s important to note that this step won’t be necessary in all cases. If your business experienced a theft or a car accident, for example, contact the police and file a report. You’ll also want to get a copy of the report to give to your insurance company, as most require a police report when a crime occurs.
Step 4: Contact Your Insurance Professional
Your insurance agent or broker should be contacted as soon as possible to inform them of what has happened. They will help you through the claim process, asking questions about what happened and what parts of your property need to be replaced or repaired in order to submit the claim to the insurer.
Step 5: Prepare for the Adjuster
If the damage to your business is considerable, your insurance professional will assign an adjuster to check the damage out. Be prepared for the adjuster to not only examine the damage but also take a look at your business’s records and books as well. The adjuster will then determine how much liability lies with your insurer.
Step 6: Get Quotes From Professionals
It’s best to get at least two quotes and estimates from professionals for the repairs needed. You’ll also want to do what is needed to prevent further damage, such as putting a tarp over any exposed roofing if that is where the damage occurred. Be sure to save receipts for repairs you make to submit to your insurer. While you can get reimbursed for these repairs, it’s important to remember that the total settlement will include payments the insurance provider made to provide temporary fixes to your property in order to avoid further damage.
Step 7: Get Professional Help if You Need It
Professional help could come from either a lawyer or an accountant. If the claim you file is sizable, you may want to consider contacting an insurance lawyer to get some advice. They can not only help you through the claim process, but they can also help you if any disputes arise between the adjuster and you. Similarly, if you’re concerned about the claims filing process and you need assistance, it can be a good idea to speak to an accountant before you file.
Can Your Agent File a Business Claim on Your Behalf?
Your insurance agent can file a business claim on your behalf. It isn’t necessary for your agent to do so, but if you feel it is the best option, then they can. If not, your agent will help you through the insurance claim process. Your insurance agent has an obligation to help guide you through the claims process as their client .
Common Documentation for a Business Insurance Claim
The most important document you need to file for a business insurance claim is the reporting form. These forms are fairly uniform across the board. If necessary because of a crime, a police report will also likely be needed to be submitted to your insurer. The actual claim forms will probably be filled out and sent to the insurer by your insurance professional. However, you’ll need to provide a proof-of-loss form to the adjuster, most often in the form of photos or surveillance footage.
Is a Business Insurance Claim Worth It?
Before filing a claim when an incident occurs, be sure to consider all your options. While filing a claim may be worth it in some cases, it is not so in all instances of damage or loss. If you file too many business insurance claims, that may be a red flag for insurance companies that you aren’t doing your part to keep your business safe and secure, resulting in higher premiums and non-renewals. Filing may not be worth being flagged as high risk when the damage is small and can be handled out of pocket.
Filing a claim is not worth it if the circumstance is excluded from your coverage. Not only will you not get the payout for the damage, but the instance will still go on and stay on your insurance record. In addition, remember that some insurance policies have a deductible that will subtract from the amount of the claim. So if your claim is worth $3,000 and your deductible is $2,000, then you’ll only get $1,000 for damage repair.
A business insurance claim may be worth it if the damage that occurred may cause further damage. For example, if a small incident occurs and you don’t contact your insurer immediately, then you could be denied later down the line if that small damage was to cause further damage.
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Frequently Asked Questions
What are the documents required for an insurance claim?
To file a business insurance claim, you’ll need to complete a claims form and submit photos of the damage to your insurance provider. You should also create an inventory of all the items that were damaged and get at least two estimates from repair professionals so your insurance company can assess the damage. You may also need a police report if a crime was involved.
What is an insurance adjuster?
As an employee of your insurance company, an insurance adjuster examines your policy and the losses you’ve incurred to determine how much money the insurance company owes you based on the terms of your insurance contract.
How long does insurance claim take?
The duration of an insurance claim can vary depending on various factors such as the complexity of the claim, the type of insurance, and the responsiveness of the insurance company. In general, simple and straightforward claims can be resolved relatively quickly, usually within a few weeks. However, more complex claims that require additional investigation or documentation may take longer, possibly several months. It is important to keep in mind that each insurance company may have its own processing times, so it is best to contact your specific insurance provider for an estimate on how long your claim is expected to take.
About Sarah Horvath
Sarah Horvath is a highly respected freelance senior copywriter specializing in insurance content. With a wealth of experience, she is recognized as one of the top insurance copywriters in the industry. Sarah’s expertise encompasses various aspects of insurance, including home warranties, life insurance, health insurance, and more. Her insightful articles and guides are regularly featured on major finance sites, providing invaluable information to readers seeking to navigate the complexities of insurance policies. Known for her clear, concise writing style and comprehensive understanding of insurance products, Sarah is dedicated to empowering individuals with the knowledge they need to make informed decisions about their insurance coverage.