How to File a Business Insurance Claim

Do you know how to file a business insurance claim? Your company may enjoy many claim-free years and then a loss suddenly occurs. How will you respond? Do you know how to avoid claim filing mistakes? Managing business insurance claims involves three steps: planning, reporting, and following up.

Planning

Planning is a critical part of risk management. Business owners should have a disaster plan in place. Employees should be trained on how to report a claim properly. Here are some tips that can help with planning:

• Cameras: Digital cameras provide a record of an event. A picture or video can help substantiate the facts in your written claim. Consider placing a digital camera in each of your company's vehicles. You should also consider providing cameras to clerks, managers, and foremen in your shipping and receiving departments. Instruct your employees on how and when to use them. Surveillance cameras placed in building entrances, exits, and parking areas can document acts committed by vandals or thieves. Choose cameras that retain digital records for at least 30 days.
• Uniform Written Reporting Forms: Use uniform documents for reporting accidents or major incidents. You can obtain standard forms from your agent or insurer. Make these forms available to your employees and instruct them on how to use them.
• Mock Drills: Test your disaster plan by staging mock disaster drills.
• Regulatory Compliance: Be sure your disaster plan complies with safety regulations imposed by state or federal agencies, including OSHA.

Reporting

As a general rule, you must notify your insurer of any accidents or claims as soon as possible in order to qualify for coverage under a commercial insurance policy. Thus, you should report incidents such as fires, auto accidents, thefts, weather damage, and third-party injuries to your insurer immediately.

• Report to Law Enforcement: Report property incidents involving crimes to law enforcement. Many policies that cover commercial property or auto physical damage state that you must report theft losses to the police.
• Contact Your Insurance Professional: Your agent or broker should explain the claim submission process. He or she will collect information from you and prepare a claim form. This form is sent to the insurer. Ask your agent for a timeline on the claim process. He or she should also explain how to contact the insurer's claims department.
• Contact Your Insurer: Once your insurer receives the claim form, it will assign your claim to an adjuster. The adjuster may be an independent contractor or an employee of the insurer. Try to contact your adjuster within 72 hours after filing your claim. The adjuster will request a proof of loss. When you send the adjuster the completed form, include any relevant photos or videos.
• Contact Professionals to Assess and Repair Damage: Many businesses delay critical repairs. This is a mistake. You may be able to keep your business running if you make repairs promptly. Get estimates of repair costs from reputable contractors as quickly as possible. Try to obtain two or three estimates.
• Contact Competent Legal Counsel: Consider hiring a lawyer knowledgeable in insurance to prepare a claims package to present to your insurer. A lawyer with insurance experience may be able to facilitate the claims process. An attorney can assist you in disputes with your insurer.
• Contact Competent Accounting Assistance: Consider retaining a forensic accountant if you are filing a business income claim. An accountant can prepare the documents you need to file your claim.

Following Up

Once you have reported a loss to your insurer, be sure to follow up regularly with the adjuster assigned to your claim. The adjuster should keep you informed as your claim progresses. If weeks go by with no word from your adjuster, ask him or her for a status report. Mark your calendar to contact the adjuster on specific dates, and stick to your schedule. Be polite but assertive when dealing with your adjuster. If you aren't satisfied with the adjuster's response, ask your agent or broker for assistance. He or she should take an active role in resolving your claim.