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, Author: Talage Team

How to Prepare Small Business For Tornadoes

How to Prepare Small Business For Tornadoes Disclaimer: Tornado preparedness information in this article is observational in nature. It is not intended to be a substitute for general safety recommendations from your local first responders. Information is not intended to serve as legal advice, e.g., for adhering to workplace compliance requirements around safety. Please consult appropriate authorities and use the information in this article at your own risk. 

Every year, around 1,200 tornadoes hit within the U.S., according to the National Oceanic and Atmospheric Administration (NOAA). Tornadoes have been reported in every state. There is a chance to reduce the risk stemming from these extreme weather events. Small businesses could benefit by preparing for tornadoes. Insurance agents can help their clients in this regard. 

Insurance agents might not have the background in property adjustments. Instead they can help small businesses assess their risks and review insurance coverage. By having a proactive plan in place they don’t have to scramble if a tornado does end up affecting them.

In this article, we’ll take a closer look at what insurance agents can do in terms of how to prepare small business for tornadoes. In turn, this can help agents develop stronger ties with clients and improve retention.

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Identify Risks

One way insurance agents can solve how to prepare small businesses for tornadoes is to apply risk management skills. You may not know the ins and outs of preparing for extreme weather, but you might have a lot of experience working with other businesses to assess their risk levels. Ultimately figuring out more ways to reduce those risks for a business owner.

To prepare for tornadoes, that can mean looking at areas like:

Property Risks

Insurance agents may be able to help small businesses to account for physical property risks in terms of figuring out what’s at stake. Two businesses in the same city might have different property risks. One might be located within a large office building. The other occupies a standalone storefront, their risk levels are different.

Risks can also differ if a company rents office space and has minimal equipment. Not much physical property might get damaged that the business is responsible for. Conversely, a business like a luxury retail store might have a lot of merchandise that’s physically at risk. 

Financial Risks

Property risks carry a financial cost in terms of repairing or replacing damaged equipment, merchandise, storefronts, etc. But small businesses also may need to consider financial risks like the loss of income if they can’t use their office or store following a tornado. Even if their physical property gets spared, others in their community might not be so lucky. In that case, their customers might cut back on expenses to cover their own costs from a tornado. All this could lead to a downturn in your customer’s business.

Review Insurance Options

With risks in mind, a clear way insurance agents can help regarding how to prepare small businesses for tornadoes is to review insurance options. Small businesses with existing coverage, such as a business owner’s policy (BOP), should know how much could potentially be covered in the event of a tornado. They may find that they need to then make adjustments, like upping their coverage limits. 

Small businesses might find that existing policies do not cover certain areas that could be at risk from tornadoes. A business owner might want to add some sort of business continuity coverage to cover the financial risk of lost income due to a tornado. This can go beyond just property risks that liability policies might cover. 

These considerations could be addressed in yearly renewal meetings. You may send clients a renewal notice for the same policy, hoping that they choose you instead of going with a cheaper option. Instead insurance agents can provide more value throughout the renewal process. Offer to meet and discuss different risks. Explain how different types of insurance coverage can help small businesses prepare for tornadoes. You may be able to form more trust with clients. They may see you as more of a partner than someone who can be replaced.

The Insurance Information Institute (I.I.I.) notes, businesses should, “Review their insurance policy annually to reflect any new additions or improvements in the business. This includes construction changes to a property and recently purchased equipment.” The I.I.I. adds businesses should “maintain an up-to-date business inventory as this can help with purchasing the right amount and type of insurance, while also streamlining things like filing insurance claims if need be.” 

Develop a Response Plan

Insurance agents can help clients develop a plan in the event that a tornado strikes. This support can be limited to more financial and operational areas. Insurance agents might not have the know-how to provide guidance on storm preparation, but that still can be valuable.

For example, insurance agents can help small businesses prepare for tornado responses in terms of:

  • Filing an insurance claim in the event that a tornado causes damage. Agents can walk clients through all the steps needed to file a claim so that businesses are comfortable doing so ahead of time, which can then make the claims process more efficient.
  • Knowing where to turn for additional disaster financial assistance if needed. The Small Business Administration (SBA); insurance agents might not have a comprehensive list but might be able to at least point clients in the right direction.
  • Operating in the aftermath of extreme weather, such as being ready to work remotely if needed. Insurance agents may be able to help by connecting clients with other businesses. They may have already navigated tornadoes or other types of disasters and can offer advice. Clients might also appreciate getting proactively connected to others in your network. They might be able to turn to for additional operational support if needed. 

Planning ahead in these types of areas can often make managing the aftermath of a tornado easier. If a client tries to figure out what to do only when a tornado hits, that could slow down the ability to get financial relief.

Check in With Clients Proactively

Preparing for tornadoes isn’t easy. Insurance agents can make this process a little less challenging for clients by helping them identify risks. Review insurance coverage and develop a response plan. This helps these businesses in areas like risk management but can also go a long way toward strengthening relationships between agents and clients. 

Insurance agents should check in with clients proactively about issues like tornado preparedness. While they still may need your help in the aftermath, to navigate the claims process, discussing how to prepare for tornadoes ahead of time can help prove your value to clients. 

Businesses may not realize that their current coverage has gaps. These gaps could put them at significant financial risk. Helping them understand could make clients appreciate your services more. By discussing a disaster like a tornado, agents can also improve in areas like client satisfaction and retention.

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