Author Post: Dealing With Insurance Following Times of Disaster

Insurance is a fantastic social product that we have designed to help soften the financial blow from unfortunate incidents and disasters that are part of the human experience. Generally, the more we grow in affluence, the more important insurance becomes in our lives because we have more to lose.

Today, we are going through an historic catastrophe with the coronavirus. Businesses are being ordered to close and others shut down because customers are no longer buying our products and services. Those unfortunate victims of the virus will certainly be grateful for having health insurance. Those who pass will also have planned better for others by having life insurance.

Still, many business owners will find that their business policies will not pay for their lost business income caused by recent events. I sometimes say somewhat “tongue in cheek” that insurance companies will pay people and businesses for losses that will never happen to them but have small print excluding payment for those losses that do.

Is there any way to prevent this? The short answer is “yes.” The correct answer is “yes, except that most insurance policies do not cover all risks and some are almost always excluded.”

So, what should consumers of insurance do to give them the best odds of having coverage for a loss that will happen to them and what should they do to make certain that all the coverage benefits are paid? The first thing is to find a great insurance agent. That’s right, a human who is passionate and extremely knowledgeable about the insurance product. People should not try to be their own insurance agent and purchase insurance over the internet. That would be like trying to represent yourself in a criminal proceeding by reading internet instructions on how to represent yourself—you will get what you will pay for.

Finding an agent that will spend the time to meet with you and go over your entire personal and financial life so that various risks and considerations of what you need for you, your family and your business is the first most important job of any consumer wishing to get the best insurance coverage for them.

After the loss, “your ego is not your hero.” Do not think that you can figure out what all the small print means in an insurance policy and that you are now an expert in valuation. My rule is that the larger the claim, the more important it is to seek outside professional help. Small claims may be handled individually and that passionate insurance agent will often be able to help get the matter resolved. But once the claim becomes larger and especially if it is a commercial loss where your business survival depends on a prompt and full recovery, getting additional help from claims experts is important.

The insurance company will have their own experts. Sometimes, those experts who should have your best interest in mind do not and you will never find out until it is too late.

My best advice to people looking to avoid a second insurance disaster after a catastrophe is to seek the best help you can before and after the loss.