Filing insurance claims can be a daunting process for small business owners. Understanding the ins and outs of the claims process can be difficult, and it is easy to make mistakes. In this blog post, we will discuss some of the most common mistakes small business owners make when filing claims and how to avoid them.
Common Mistakes Committed by Small Business Owners When Filing Claims
The most common mistakes you can make while filing insurance claim for your small business are as follows:
1. Unaware of the Policy Details
The most common mistake small business owners make when filing a claim is failing to read through the policy to know what it covers and what it does not cover. It’s important to understand the coverage types and limits mentioned in your policy and be familiar with the terminology used in it. Many policies cover certain perils, such as fire, theft, and vandalism, but not others, such as floods or earthquakes that you may mistakenly assume to be included in your policy. If your business suffers a loss from a peril that isn’t covered by your policy, then you won’t be able to file a claim for it and may have to recover the damage costs from your own pocket.
2. Failure to File a Claim Promptly
Another mistake small business owners frequently make is failing to file a claim on time. You must inform your insurance provider about the damage at the earliest as most policies have a time limit for filing a claim. This time limit is usually specified in the policy and may vary depending on the type of loss and the policy. If you do not file a claim within the specified time limit, it can result in the claim being denied.
3. Insufficient Documentation of the Damage
Failing to fully document the damage may lead to your claim being denied or you may receive reduced compensation. When filing a claim, it’s important to document the damage in as much detail as possible. This includes taking photos, videos, and other forms of evidence of the damage. This evidence should be provided to the insurer as soon as possible so that the claim can be processed quickly. Besides, proof of damage, you also must document the correspondence you have with your insurer related to the damage that can be used for future reference.
4. Discarding Damaged Goods
A major mistake small business owners make when filing claims is discarding damaged property. It’s important to keep any damaged goods that are covered by the policy as they may be used as evidence for the extent of the loss you have suffered. Discarding them can make it difficult for the insurer-appointed adjuster to assess the damage. Also, you must ensure that there is no further damage to your property for which you must get prompt repair work done. Not doing so can make it more difficult for the claim to be approved as your insurance provider may consider it as negligence.
Filing insurance claims doesn’t have to be a difficult process. By avoiding the mistakes mentioned in this blog post, you can ensure that your claim will be accepted by your insurer. For this, however, you must understand the covered perils, limits, and exclusions of the policy, file the claim quickly, fully document the damage, and avoid further damage to your damaged property.