Business interruption claims can take anywhere from 9 months to a year before a business owner sees a cent of their relief. Because business interruption claims depend on your company’s forecasted earnings, insurance companies have plenty of leeway to argue about the size of your claim—tying up the process for long periods of time. Their forensic investigators can claim that your normal or expected revenue is much lower than you estimated, even if your business was struck down during a slow month or right before a busy season.
Hurricane Harvey triggered claims for thousands of businesses in South Texas. Flooding and damage led to:
- Loss of employees
- Loss of customers
- Loss of access to offices
- Damage to physical locations/offices
Due to the significant loss of revenue and equipment that disasters normally incur, the size of an average business interruption claim exceeds $1 million—even for a small business. A large portion of the losses causes by hurricanes come from local business’ loss of revenue: of Hurricane Katrina’s $25 billion in business losses, $6-9 billion was from interruption of operation and earnings.
Why Insurance Companies Are Denying Claims
However, such significant losses puts insurance companies on the defensive—making them less likely to honor your claim upfront. Thomas Arnold, a local optometrist in Sugarland, has had his business interruption claims denied twice from two different disasters. His claim from a 9-day power outage due to Hurricane Ike and his claim for a 5-day closure during Harvey were both denied on the grounds of “lack of physical damage.”
That’s right—the infrastructure around your business could be crumbling, making you inaccessible to customers and staff…but if nothing actually happens to your physical office, your insurer may deny your claim. Too many business interruption claims come with fine print excluding any interruption losses that aren’t from direct damage to your business’ physical location. That means hundreds of business owners in the greater Houston area are paying thousands of dollars in premiums a month with no assurance that their losses will be covered.
Fighting for Your Business’ Future
At the heart of an insurance contract is a promise: your insurance company agrees to take your monthly premiums in return for the assurance that they will pay for your losses in a disaster. If an insurer refuses to uphold their end of the deal (or your insurance agent knowingly sold you a policy that would never benefit you), that’s not only unethical—it’s illegal. Unfortunately, that’s exactly what insurance companies are doing to businesses in the greater Houston area.
In the wake of Hurricane Harvey, our businesses are the backbone of the recovery efforts. Strong businesses means a strong local economy, which helps owners, customers, and families get back on their feet faster. Our firm is fighting for our local business owners, helping them file interruption claims with the support of our own expert adjusters, damage assessors, forensic accountants, and other knowledgeable staff.
Call (888) 493-1629 or contact us with our short online form to learn about your legal and financial options.