Business Interruption Insurance

• Prompt notice of an accident is vital to comply with policy conditions and to protect the interest of the firm and its insurer by making possible an investigation shortly after the accident when witnesses are available and the facts are still fresh in their minds.
• Pictures of the accident scene, taken as soon after the accident as possible, can be extremely helpful in showing the condition of the property, machinery or equipment. Pictures should be taken from several different angles to avoid a distorted impression and to be sure that nothing pertinent is hidden from view.  Such pictures may be extremely important in the defense of a claim or in determining that liability does exist and the claim should not be resisted.
• A detailed description of the accident should be obtained with a clear concise statement of exactly what happened and how.
• The names and addresses of witnesses, whether employees or members of the public, should be obtained together with any statements they might make.
• The report should include a clear description of the conditions existing at the time of the loss. This should describe the physical conditions (i.e. whether the sidewalk or floor was clear of obstructions, whether it had cracks or holes, whether the railing was loose or secure, etc.) Comment should be made about the presence or absence of warning signs if there were hazardous conditions in existence. The weather should be described for an accident occurring outside, especially if there was any precipitation at the time of, or immediately preceding the accident.
• Any statements made by the injured party should be recorded with confirmation by witnesses if possible.
• Do not admit liability or offer statements to anyone other than your adjuster.
• The provision of first aid or medical assistance is not an admission of evidence.

When you are notified of a serious loss, you will become responsible for a number of things, both in respect to the insurance contracts and your own management.

The following guideline will help you decide what must be done first:

• All losses should be reported directly to:

Joel Carey, Partners Indemnity

Office: (905) 336-1302
Mobile: (905) 876-6411
Fax: (905) 681-1054
E-mail: jcarey@csrm.ca

• Alert your people to expect the Adjuster and/or Insurance Company representatives. 
  
  Many other people in your organization will need to know about the loss as well. You should set up special work orders, job numbers and other accounting procedures to enable you to accumulate all your costs. In the first few days after loss, it can be very difficult to keep track of who is doing what and why.
  
  Provide descriptions of job numbers and be sure that overtime pay is separated because you may need this breakdown later. The straight time labour will go against the property damage portion, and the overtime to the business interruption claim.
  
  
• Restore Fire Protection as Quickly as Possible
  
  This means replacing sprinkler heads, arranging for temporary standby hose lines, recharging extinguishers and automatic CO₂ systems as soon as possible, capping broken lines and getting them back into service. This is important because your property is particularly vulnerable until fire protection is back in operation.

• Protect Property from Further Damage
  
  In addition to restoring protection, you should take whatever action possible to preserve the property from further damage, particularly from water, smoke or the weather. Your personnel should take immediate emergency measures to minimize damage. Other more elaborate but still temporary measures, should be cleared with the Adjuster, and when possible, their authorization should be obtained before proceeding. There is a simple rule of thumb which helps decision making in the very early stages of a loss: when in doubt, act as if you had no insurance.

• Salvage
  
  As soon as possible, have personnel clean up and separate the damaged from the undamaged, and get to work on saving what can be saved. Dry out all electrical equipment and motors and take rust prevention measures.
  
  
• Permanent Repairs or Replacement
  
  Before authorizing permanent repairs, discuss the situation with the Adjuster and get agreement on the scope of repairs and on the contractors who will be asked to do the work. Find out if more than one bid will be necessary.
  
  If the contractor is accustomed to working on insurance claims, they should know what type of detail is required in the proposal. If not, arrangements should be made for them to meet the Adjuster and set up the ground rules. A contractor’s bid without proper details and itemization is unlikely to be useful.