Vero Voice Blog
What does a weather event mean for your business insurance?
By Nick Meister
Executive Manager Business Property
If your business has been impacted by a significant weather event, managing the insurance process is often a lot simpler than you might expect if you follow the right process. Here are some simple tips and strategies to help make your insurance claim easier to manage.
Vero is proud to support our customers during these challenging times. The recent weather events have shown the strength and resilience of the New Zealand people and businesses, but we understand that the aftermath of a natural disaster can be overwhelming. That's why we are here to help and make the insurance claim process as easy as possible.
Safety should always be your top priority. Property can always be repaired or replaced, but human life cannot. Wait for the flood waters to subside and be cautious around electrical hazards. Don’t power up buildings or machinery unless you have clearance from an expert.
While it’s only natural to want to begin the clean-up – make sure to take detailed photos of any damaged goods and property before you start moving anything around. Make sure to wear appropriate safety equipment, such as gloves and overalls.
Once you’ve taken your photos and noted down any damage, dispose of perishable items that could pose a risk to health and safety.
Carpets, drapes and other similar furnishings that are saturated by flood water that enters from the ground (as opposed to through the ceiling or internal water systems) are likely to be unsalvageable. Look to remove these items out of the building, while following council instructions on disposal.
Make sure not to drive any vehicles or machinery that has been submerged. Your insurance company should be able to have these towed to a storage area for assessment. Make sure to remove any contents from the vehicle before it is towed!
If you need to do some urgent work to make your business premises safe or to prevent further damage, you can do this. Make sure you utilise quality repairers and tradespeople and do the minimum possible to stabilise the situation.
You may want to request a quote for damage that will require a longer-term fix which you can then present to your insurance company.
Getting in contact
While you assess the damage to your premises, get in contact with your insurance company. Vero can, in most circumstances, authorise immediate small repair jobs (under $5000 usually) if a good quality itemised quote is provided that is supported by evidence such as photos or damage reports.
During a disaster, trade services will be stretched, so you will want to be prepared for reduced availability and longer than usual lead times for repairs.
If your business has any stock damaged by the weather, this may not be saleable “as new” but may have a salvage value that your insurer will need to consider.
Your insurer will work with you on the best methods of disposal of any stock. In the meantime, they should work to pay you quickly for your stock so that you may organise replacements.
Bear in mind that customer goods are sometimes insured, so it pays to have your customers lodge claims with their own insurers first.
For business interruption, your insurance company will work with you to understand what you think you need to do to minimise the disruption to your business. If you have this cover, Vero can provide some support to allow that to happen.
If your premises are unsafe or inaccessible, think about alternative work arrangements that can minimise the disruption to your business. This might include working from home or another site.
If you’re a building owner, loss of rent will generally follow the provisions of the lease agreement. If the tenant qualifies for rent abatement, the landlord can claim if they have loss of rent cover. Any rent abatement will also be taken into account for the tenants claim as savings.
This may take the form or paying rent to work from alternative premises, as an example. Or paying other increased costs of working that will prevent an even greater loss of profit.
If the disruption to your business is significant, Vero may be able to provide a progress payment at regular intervals to ensure that you have the funds to manage your normal business expenses, like paying wages.
Keep your customers informed. Regular and clear communication with your customers will help keep them up-to-date and could minimise the impact of this event on your business.
The information in this article has been compiled from various sources and is intended to be factual information only. Full details of policy terms and conditions are available from Vero Insurance New Zealand Limited or your financial adviser. For advice on product suitability, please contact your financial adviser. While we take reasonable steps to ensure that the information contained in this article is accurate and up-to-date, it is subject to change without notice. Vero Insurance New Zealand and its related companies does/do not accept any responsibility or liability in connection with your use of or reliance on this article.