What To Know About Water Damage And Business Interruption Insurance

In deep water? How flood insurance can keep you afloat

Flooding. It’s a scary thought. The reasons why your business may flood are increasingly varied. And it’s not just burst pipes and aging infrastructure that you need to be worrying about. It’s the bigger picture as well too. The government of Canada’s landmark 2019 report: Canada’s Changing Climate delivers some key headline statements that should be on every business owners radar.

For instance:

• “Precipitation is projected to increase for most of Canada, on average, although summer rainfall may decrease in some areas.”¹
• “While inland flooding results from multiple factors, more intense rainfalls will increase urban flood risks.”²
• “Coastal flooding is expected to increase in many areas of Canada due to local sea level rise.”³

Floods are miserable ordeals, even with extensive preparation. They can spring up with little to no warning and quickly weigh you down with the responsibility of a lengthy, expensive and challenging restoration period.

But floods can also be regenerative. Large-scale damage to your business is an opportunity to rebuild and minimize potential damage and disruption that could be caused by future floods. If your business has sustained flood damage, do not panic. Think of it as a chance to fortify your business against future flood damage rather than nothing but a ruinous misfortune.

Getting flood insurance aligned is the best way that you can better manage flood risks and recovery.

Keep reading to learn about how to deal with a flood, cleaning up and steps you can take to mitigate future flood risks.

After a flood. What to do when you discover water…

You just got a call from one of your employees. The storm has passed but your warehouse is flooded. What to do now?

Once floodwaters start to recede, you may want to immediately get your hands dirty and start the cleanup effort. Fight that urge. Never re-enter premises until you are absolutely sure they are safe.

Floods leave multiple hazards in their wake, such as exposed wires, weakened buildings and contaminated water. Your first priority should be the safety of yourself, your employees and anyone else who might enter or pass near your business.

 

A representative from your insurance company will likely visit your flood-damaged premises and offer guidance after floodwaters start to retreat. Until then, use extreme caution when visiting your business.

Before entering your flood-damaged building:

• Notify your insurer. Take pictures of contents and damage for your insurer—the more the better—but only if it is safe to do so.
• Immediately turn off your building’s gas and electricity as well as any fuel taps.
• Never touch sources of electricity when standing in floodwater.
• Check for structural damage before entering the building. Do not enter if there is any chance it may collapse.
• Avoid all water-damaged structures, stairs, floors, roofs and overhangs until they have been checked for stability and safety.

Flooding causes business interruption. Above all, flooding disrupts you from being able to safely continue operating your company. As a result, business interruption insurance is an essential tool for any business owner’s risk management approach.

In short, if water damage and flooding are on your mind, an ALIGNED Insurance broker can connect you with comprehensive flood insurance that will respond to a worst-case scenario.

12 tips | Cleaning up water damage in your business

In addition to taking your claims information, your insurer will send a loss adjuster and other specialists to assess your business’ damage. After ensuring that your property is stable, it is time to clean up.

During clean-up efforts, it is important to stay safe.

For example:

1. Ensure you and your employees follow every health and safety precaution, such as wearing boots, rubber gloves and other personal protective clothing. And be extremely careful when handling debris.
2. Dispose of equipment only after notifying your insurer.
3. Disinfect your property with ordinary household cleaners, but follow the manufacturer’s directions to ensure you are disinfecting properly. Let cleaned surfaces dry completely.
4. Open a window and leave the building if you smell gas or hear blowing or hissing—these may be signs of a gas leak.
5. Operate electrical equipment only if the ground is dry—never operate electrical equipment that is in or near water.

In addition:

1. Use a bleach solution to clean water taps. Taps submerged in floodwater are most likely contaminated. Let the water run for 30 seconds prior to using it.
2. Drain water in stages to avoid disparity between the water pressure inside and outside your building.
3. Shovel mud out in stages so the pressure inside and outside remains equal. Remove the rest with a hose, but make sure it is not a high-pressure one—these hoses can blast contaminants into the air.
4. Use a pump and generator to remove water. Position the generator outside in the open air if it produces carbon monoxide. Only pump out water once the flood levels outside your property are lower than inside.
5. Keep windows and doors open, weather permitting, to expedite drying, but never sacrifice building security.
6. Dry your building using a combination of fans, industrial heaters and dehumidifiers. Your insurer may provide these tools.
7. Leave central heating on at 20° C or above to encourage drying if it is safe.

How To | Upgrade your risk control after water damage

Yes. Good things can result from worst-case scenarios. You can the most out of an unfortunate situation by using your flood damage as an opportunity to repair your property with flood-resistant products.

Consider installing the following flood-resistant precautions:

• Pumps and pump systems sit below the ground floor to remove water that enters from the ground.
• Installing a flood skirt around potential water inlet areas creates a much-needed water damage barrier.
• Water-resistant sealants refer to a wide variety of sealants—you can use them all over your property.
• Adding one-way valves to water pipes. Upgrading to plastic fittings in kitchens and bathrooms.
• Raising electrical sockets, fuse boxes and wiring at least 1.5 metres above the floor level
• Using high shelving is a convenient option for ensuring you have an area above floodwater to store valuable items.

Flood insurance coverage responds to water damage

No matter what you install, the best preparation for a flood is proper insurance. Remember that your damaged stock and premises will not be the only setback you suffer from a flood—interruption to your business’ continuity can be fatal. Taking risk-reduction measures may help cut down your premium or excess.

 

Source(s): ^1,2,3 Nrcan.gc.ca: Canada’s Changing Climate Report ;