Property insurance policies
usually exclude coverage for
flood damage. If you need to
buy a flood insurance
policy, contact your
insurance agent or
the National Flood Insurance
Program.
The federal government
requires buildings in flood
zones to be torn down if
damage exceeds 50 percent of
the market value. You can
consider purchasing
"ordinance or law" coverage
to help pay for the extra
costs of tearing down the
structure and rebuilding it.
If your policy contains a
coinsurance clause, make
sure your property is
sufficiently insured.
Earthquake Damage
If your business is in an
earthquake-prone area, you
may need a special
earthquake insurance policy
or commercial property
earthquake endorsement.
Even business
interruption insurance,
which reimburses you for
lost income during a
shutdown, also applies only
to causes of damage covered
under your business property
insurance policy.
Therefore, if there might be
high possibility of earthquake
damage to your business, you can
consider earthquake coverage to
make a claim under a business
interruption policy.
Earthquake policies have a
different kind of deductible --
a percentage of coverage rather
than a straight dollar amount.
Terrorist Attack Losses
Under the Terrorism Risk
Insurance Act of 2002, only
businesses that purchase
optional terrorism coverage
are covered for losses from
terrorist acts. The
exception is workers
compensation, which covers
injuries and deaths due to
acts of terrorism.
