Natural Disasters in Alberta
In Alberta, we’re lucky to skip out on most of the really awful natural disasters like earthquakes, tsunamis, and hurricanes. However, there are a few natural disasters that can wreak havoc on everything from our homes to our businesses.
For example, just this past summer, Calgary was hit with a wave of hail storms in June and July. The worst storm occurred on June 15th, with tennis-sized hail raining down and destroying homes, cars, and businesses. The storm cost $1.2 billion and is fourth on the list of Canada’s most costly natural disasters. In fact, six of the top ten costliest natural disasters have occurred in Alberta!
Many people were lucky to have insurance in place for this event. However, it’s a good reminder that there are a few things you can do to protect your business from damage before and after an “Act of God,” as natural disasters are sometimes referred to in the insurance world.
The Costs of Natural Disasters and How to Mitigate Them
Physical businesses with a storefront or warehouse are obviously impacted the most in a natural disaster. Hail storms, tornadoes, fires, flooding, and other events can ruin a building, and whether you own the building or lease it, there’s always some costs associated with these events.
One of the most costly aspects of a natural disaster isn’t necessarily the physical damage to the building, but the interruption to business. If you have windows broken, flooding, or damaged equipment, it’s unlikely that you and your employees will be able to return to work as normal the next day. In many cases, just a few days of shutting down can cost a business tens of thousands of dollars, and if a building has to be repaired or replaced, those costs are multiplied. In the meantime, you’ll likely still be paying all your normal expenses, such as phone bills, leases or mortgages, salaries, and professional services.
This is a major loss many businesses aren’t prepared for in advance, which is why business interruption coverage exists.
Check Your Commercial Insurance Policy in Alberta for Business Interruption Coverage
Most business owner’s policies and commercial insurance in Alberta come with business interruption coverage. This means that if a natural disaster occurs (or another unexpected event), your business will be reimbursed for that downtime. This helps replace the lost income from the event and pay for extra expenses.
If you aren’t sure whether or not your commercial insurance policy covers business interruptions, be sure to check your policy or ask an insurance broker in Alberta.
Physical Property Damage
If you own commercial property, a natural disaster can be incredibly costly to your business. Damage from any kind of disaster varies greatly. A broken window is much different than a building that’s been burned down. However, even minor damages to a property can be costly, and they often come at inconvenient times!
Check Your Commercial Insurance in Alberta for Coverage Exclusions
Commercial property insurance policies from different insurance companies in Alberta may cover different types of natural disasters, but some events may be excluded, such as overland flooding. It’s important to check with your insurance broker to make sure you understand which events are covered and to see where you can fill in the gaps with specialty policies, where necessary.
If you own a commercial building or commercial property in Alberta, you’ll want to make sure you have a robust building insurance policy in place. Visit the Cornerstone Insurance learning centre to find out more about commercial property insurance.
Preventative Measures to Protect Your Business
At Cornerstone Insurance, we hope you never have to use your commercial insurance to cover a natural disaster. Even when your insurance covers all of your expenses and losses, it’s always a stressful time for business owners and employees alike. Because of that, we always like to offer businesses some ways to protect themselves from unfortunate events.
Put Measures in Place to Protect Equipment, Inventory, and Buildings
You can almost never “plan ahead” for a weather event, but there are a few steps you can take to minimize risks when they do occur:
- Keep important data backed up at all times
- Store important paper files or documents in safe places, such as up high on a shelf to protect it from flooding, or in a fire-proof safe
- Unplug appliances and equipment when it’s not being used (or overnight)
- Keep emergency kits and first aid kits stocked and ready to use
Create a Disaster Recovery Plan
Of course, creating an evacuation plan is one of the most critical steps you can take. Inventory, buildings, and equipment can all be replaced or restored, but human lives cannot. It might cause some grumbling, but be sure to hold regular drills for your employees with different scenarios so everyone knows what to do in case of an event.
If you won’t be able to return to work right away but you can conduct your business elsewhere, it’s a good idea to have this planned in advance. Perhaps there is another location you could lease, or you may be able to allow employees to work from home.
The people who depend on you for products and services are at the heart of your business, so it’s important to let them know what they can expect in the coming days and weeks. Get in touch with your clients right away to explain what happened and let them know how to get in touch.
Work with a Trustworthy Insurance Broker in Alberta
When a natural disaster occurs, hundreds or even thousands of businesses and people may be affected. In times like these, it’s comforting to be able to get in touch with your local insurance broker right away and have them there to guide you through the process. This lets you skip staying on hold for hours at a time with overloaded insurance companies, and get personalized advice and care.
At Cornerstone Insurance brokers, we’re here for Albertan businesses through the good times and the tough times! Get in touch to learn more about our brokers, or request a customized commercial insurance quote now.