Small businesses are generally exposed to many perils. Client injury, equipment failure, natural disasters, and more can impact your operations and bottom line. Commercial insurance helps small business owners manage business risks. For instance, general liability insurance safeguards a business against liability claims related to third-party bodily injuries or property damage. However, as a business owner, carrying business insurance doesn’t necessarily mean that you’ll be compensated for lost time or damages, especially if you make a mistake when filing an insurance claim.

Here are six common mistakes to avoid when filing business insurance claims.

1. Not Knowing Your Policy

   Insurance policies are complicated and may not include all the perils you expect. Therefore, before you purchase a policy, you should understand what it does and doesn’t cover. You don’t want to realize that you’re not covered after a disaster strikes. Knowing what your policy covers will help you find coverage gaps and decide on the additional policies you need.

2. Not Reporting Losses Immediately

   You should contact your insurer immediately after you find out that a business-related mishap has happened. At this point, you’ll have a fresher memory of what happened. Additionally, the process of adjusting your claim will be easier if you make a claim earlier. Delaying to file your claim can confuse the insurance companies about the extent of damages. Failure to report an incident at the earliest time possible after the event may lead to your insurer denying your claim.

3. Not Recording Damage

   After a disaster, you’ll need to provide proof of damage. If you fail to carefully document the damage resulting from a covered incident, your insurer may deny your claim or you may get a lower payout. Therefore, you should take detailed photographs of the scene immediately. Focus on the damage wrought.

   Besides, you should keep a record of your communication with the insurance company. Document the following:

   • Date, time, and substance of all your verbal conversations
   • Copies of all the mailed correspondence
   • Copies of all the email exchanges

   If you have a phone conversation with the claims representative, send them a summary of your conversation via email, or demand a transcript of the conversation. By documenting communication, you’ll avoid any misunderstandings or denials down the road.

4. Throwing Away Damaged Goods

   Don’t get rid of the damaged property after taking photos. The damaged items are evidence of your loss and thus will shape an adjuster’s report.

   Conversely, you should take the necessary steps to prevent any further damage. Failure to do this may be considered negligence, giving your insurer grounds to refuse your claim. If you use your money to pay for temporary repairs to prevent further damage, you should save the receipts and present them to your insurer for reimbursement.

5. Admitting Fault

   Admitting fault removes any doubt that you’re to blame for the incident and thus makes it difficult for your insurer to defend you. Besides, many policies prohibit policyholders from admitting fault without the insurer’s consent; thus, admission can be a breach of your contract. Admitting fault can lead to your insurer terminating your coverage or denying coverage.

6. Not Advocating for Yourself

   Some insurers may underestimate your loss. In this case, you should appeal the adjuster’s initial estimation by getting a second estimate from your own adjuster. If the two estimates vary, a third-party mediator will make the final decision regarding your payment.

At McCarty Insurance Agency , we will help you find suitable commercial policies for your business and support you during the claims process. Contact us today to learn how we can help you.