Articles Posted in Natural Disasters

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Hurricane Helene struck Florida’s Big Bend region as a category 4 hurricane on September 25, 2024, and continued to move northeast. The storm caused widespread power outages and catastrophic damage across Florida, the Carolinas, Tennessee, Georgia and other states. It has brought life-threatening storm surges in its aftermath. Now, less than two weeks later, Hurricane Milton is making its way toward Florida’s western coast and threatens to cause additional catastrophic damage.

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The below checklist includes essential considerations and steps to take for property owners and businesses that stand to be affected by hurricanes.

  1. Make an inventory of risk pathways that could affect your business.
    • Identify essential supply chains, raw materials or parts providers and service providers to assess impact of potential disruptions.
      • Stress-test what would happen if each supply chain were interrupted.
      • Identify markets and customers whose disruption could affect your business.
    • Identify potential sources of liability if your business was impacted by the hurricanes.
      • Failure to meet contracted-for requirements
      • Failure to take adequate measures to protect customers from harm
      • Management failure to train employees to plan adequately for impacts, with concomitant claims by shareholders, regulatory authorities, customers, third parties
      • Other?
    • Identify other constituencies that might be affected by disruption to your business and risks associated with such disruption.
  2. Before any disruption occurs, identify and review insurance products that may respond.
    • First-party Property and Business Interruption insurance—for stoppage or slowdown of your own business, typically due to physical loss or damage to property
    • Contingent Business Interruption (CBI) or Supply Chain Risk insurance—for disruption of supply chains and, potentially, markets
    • Commercial General Liability (CGL) insurance—for liability to third parties arising from bodily injury or, potentially, personal injury or property damage
    • Directors & Officers (D&O), Management Liability, Errors & Omissions (E&O), and Professional Liability insurance—for claims that management personnel failed to take appropriate measures to protect the business or third parties
    • Event Cancellation insurance
    • Travel insurance
    • Workers’ Compensation insurance—adopt protocols and procedures to help employees make a record establishing work-relatedness in submitting claims
  4. Review business contracts to assess whether you are obligated to provide coverage to customers/clients, joint venture partners, contractors or others for risks outlined above.
  5. Review customer contracts to assess whether you are entitled to coverage provided by customers/clients, joint venture partners, contractors or others for risks outlined above.
    • If so, request copies of relevant insurance policies (not just certificates of insurance) and review them to assess potential coverage.