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Five important questions businesses should ask their insurer following Hurricane Laura

JOHNSTON, R.I., USA—Major flooding and wind damage caused by Hurricane Laura will likely involve a long-term recovery for businesses that suffer storm-related losses, especially those still struggling as a result of the COVID-19 pandemic, according to FM Global, one of the world’s largest commercial property insurers. The resilience of already fragile businesses, especially those that supply necessities like food, shelter, fuel, power and paychecks, may very well hinge on a quick settlement of their storm-related insurance claims, says the insurer.

Affected businesses should press their insurers for rapid claims response and, when in doubt, challenge their insurer to answer these five questions:

1. Are adjusters on the ground, ready right now to assess the damage to my business?
If your situation requires a site visit, the answer should be yes.  Once you have determined it’s safe to be on site, the adjuster should arrive within 48 hours of your call, or better yet, call you proactively.

2. Can your adjuster authorize payments?
Ideally, your adjuster will have the authority to make decisions and issue prompt payments to help you quickly restore operations.  If your insurer employs independent adjusters, however, that authority may not exist.

3. When can I expect payment?
You should expect payments from your insurer early and often during the restoration process. Under the best circumstances, the relationship between the policyholder and the insurer is established well before a loss ever happens, to help prevent surprises should a claim arise.

4. How long will it take to complete a damage assessment?
It varies with the complexity of the loss. The claims adjustment process is a dynamic one.  If both the policyholder and the adjuster are working in a spirit of cooperation, the damage assessment process can often be completed quickly, and the entire claim can usually be settled in a matter of months.  During this process, interim loss payments can be made. The more closely the insurer and insured work together, the greater the chance the claim will be settled quickly and satisfactorily.

5. How long will you be on site to help with restoration and recovery?
You should expect your insurer to be with you until the job is done, on site, partnering with you and answering your questions about restoration and policy response.  This will ensure you recover as quickly and smoothly as possible and that you make plans for risk mitigation in the future.

Study: Hurricanes can harm long-term company value
In addition to quick claims response, FM Global is committed to the principle that resilience in the face of natural hazards is to a considerable extent a choice.  Last year a first-of-its-kind analysis conducted for FM Global linked hurricane damage to a loss in shareholder value and conversely, property protection to value preservation. The findings were uncovered when FM Global commissioned Pentland Analytics, an independent strategic advisory firm, to conduct the research that expanded on FM Global’s white paper “Master the Disaster: Why CFOs Must Initiate Natural Catastrophe Preparedness in 2019 and Beyond.” Dozens of large publicly traded companies that reported hurricane-related financial damage to the U.S. Securities and Exchange Commission in their 10-K annual statements collectively lost 5% of their shareholder value over the year following the storms.

About FM Global
Established nearly 200 years ago, FM Global is a mutual insurance company whose capital, scientific research capability and engineering expertise are solely dedicated to property risk management and the resilience of its client-owners. These owners, who share the belief that the majority of property loss is preventable, represent many of the world’s largest organizations, including one of every three Fortune 1000 companies. They work with FM Global to better understand the hazards that can impact their business continuity in order to make cost-effective risk management decisions, combining property loss prevention with insurance protection.

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