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How to File a Small Business Insurance Claim

Do you own a small business and you want to know how to file a business insurance claim?

Are you skeptical that the size of your business may hinder the prospects of filing an insurance claim?

Has your small business suffered any event of loss or property damage and you are uninformed about the steps to filing an insurance claim?

Congratulations already! In this article, you will discover if your small enterprise qualifies to file a business insurance claim, when to file one, and how to file a claim.

If you fell for the misguided opinion that your small business should not have an insurance cover and it can not be eligible for an insurance claim, then we want to counsel you to start getting rid of those opinions.

Yes! Your small business should have an insurance cover.

Yes! You can file an insurance claim.

Insurance coverage is not limited to the size or nature of a business neither is the filing of an insurance claim.

Whether you are a big corporation with business presence in the United States and all over the world or you are a startup doing business from the comfort of the sofa in your living room in a rural suburb in Pennsylvania or anything within this range, you can get an insurance cover which qualifies you for an insurance claim.

What is a Small Business Insurance and Why You Should Have One?

A small business insurance coverage is an insurance policy that helps start-ups and entrepreneurs owning small businesses to protect their businesses from losses due to a property or casualty damage.

This insurance policy helps small business owners by paying for the expenses they may incur in the occurrence of a loss or damage by events such as a storm, robbery, theft, fire outbreak e.t.c

It is important for your small business to have one because events like the aforementioned can make them vulnerable. Data from the US Bureau of Labour Statistics shows that approximately 20% of new businesses fail during the first two years of starting, 45% during the first five years, and 65% during the first 10 years. Only 25% of new businesses make it to 15 years or more.

Small businesses are less likely to survive from a financial loss or property damage compared to big corporations. To increase the likelihood of survival and ensure continuity of their business even after a fall, a small business owner should get a business insurance policy.

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When Should a Small Business File an Insurance Claim

Before the thought of filing an insurance claim comes up, the business must be insured. When there is no business insurance policy covering your small business, you are not entitled to make a claim.

If your business has been insured, then the following should be checked before you can be sure your insurance claim will be accepted or denied.

It is important to note that insurance policy providers can choose to accept a claim or not to. But if these requirements are met, there is a 101% possibility your claim will be accepted.

1. If you cannot pay for the loss

You are eligible for a business insurance claim when you can not pay for the loss your small business incurred during a covered event.

If upon assessment of the loss recorded, you are unable to make up for it, you should file an insurance claim.

2. Business interruption

You can file for a business interruption insurance claim if the event caused a disruption in your business activities.

If your small business had to slow down in operations or suffer a temporary shut down due to the loss then you are entitled to what is called a business interruption claim.

3. Liability lawsuit 

A liability lawsuit may be fired against you when someone gets injured while in your business premise or if someone feels defrauded by the activities of your business.

When you have lawyers at your doorstep, you can file for a liability lawsuit claim to assist you in paying for legal fees. This advice has helped a lot of independent yoga instructors from going bankrupt.

4. Aggregate deductibles

The final requirement on our checklist for ascertaining your small business’s eligibility for an insurance is the payment of aggregate deductibles.

The term aggregate deductibles refers to the agreed amount you as a policyholder must pay to your insurance policy provider before you can request for any form of payment or compensation from them.

Peradventure you are yet to complete the aggregate deductible you resolved to pay your insurance provider before the incident of a loss occurs, you are not entitled to file a business insurance claim.

When all the four (4) items on our checklist are met, then you can proceed to file a small business insurance claim.

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How to File a Small Business Insurance Claim

Here’s a step-by-step guide on how to file a small business insurance claim in the United States:

1. Document the Loss or Damage 

Ensure that there is a system which recorded how the incident took place. Properly documenting all of them, recording the loss or damage which your insurance provider will demand.

2. Get a Police Report 

The event which led to your business’s loss or damage may be caused by robbery, break-in, vandalism or any criminal action. If this is the case, get the police informed, take note of the report number, and obtain a copy of the report from the police. In case you notice any insurance fraud, here’s how to report insurance fraud in the United States.

3. Inform Your Policy Provider

Waste no time in informing your insurance policy provider of the loss. The earlier you inform your insurance provider, the faster your claim may be resolved. 

Submit a copy of the report copy you obtained from the police and copies of your documentation of the loss to your policy provider.

Be proactive. Take steps your policy provider may require from you. This will fast-track your claims.

According to Maureen Le-Paine, Senior Vice President, Small Business and Portfolio Underwriting, Hiscox USA, the faster an incident is reported, the faster the insurance paperwork will be filed, and the insurance company can start and conclude its investigation.

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4. Show Damaged Properties and Casualties to Your Insurance Provider

Do not be quick to discard items and inventory that got damaged during the covered event. Take stock, record details of each damaged item, and show them to your policy provider. 

Only discard damaged items when they have been duly recorded and shown to your insurance provider. To be safe, discard them only when instructed to do so by your insurer.

Waiting for your policy provider to see casualties before you treat them may not be possible. In this case, proper documentation showing medical bills and doctor reports will suffice.

5. Salvage What Remains 

You must make sure the items which were not damaged during the unfortunate event are kept safe. Separate the damaged goods from the good ones to prevent further damages.

Insurance policy provisions do not cover property damage or loss after the initial  loss. Anything that goes bad after the initial loss will not be paid for by the business insurance company..

6. Get Estimates for Repairs 

Get quotations from bidders on the cost of carrying out repairs on the damaged products or property. Compare the quotations and choose the one which offers quality products at a discount.

Your insurance provider may require you to present some information regarding the cost of a repair. Get them ready before they do.

7. Be in the Know About Policy Provisions 

Ensure you have a comprehensive and detailed understanding of the provisions in your insurance policy. Your business insurance broker can help you interpret the technical side of the policy. This is why it’s so important to hire the services of a business insurance broker in the United States.

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Conclusion

Your business is not too small for an insurance policy. Business insurance policies are not restricted to a particular size or nature of business. Get insurance for your small business and grow your business without worries today!

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