Pre-loss disaster planning: Providing value to clients

Insurance professionals are among the few people who understand how devastating a natural disaster can be. It’s simply a matter of course in the industry. Insurance professionals have frequent, first-hand experience with how a fire, flood or other catastrophic event can completely upend the life of a property owner or manager.

As a result, insurance professionals have a unique perspective and understanding of the value of pre-loss emergency disaster planning. Seasoned professionals have handled situations both with and without pre-loss plans — and the difference between the two can be astounding, from the speed of processing the claim, to the quality of the restoration and beyond.

Pre-loss emergency disaster planning allows insurance professionals and the property owners they serve to prepare for disasters before they occur. And although the impact of a fire or flood can never be fully mitigated, these proactive strategies go a long way in minimizing damage and accelerating the rebuilding process. Here are five ways that pre-loss emergency disaster planning can provide value to insurance professionals:

1. Pre-loss planning expedites the claim process. In many cases, the aftermath of a disaster can feel as distressing as the event itself, particularly if the claim process is handled poorly. Insurance professionals often witness their clients scrambling to determine the required documentation, struggling to capture it effectively, and grappling with when and how to share it. This chaotic situation unfolds amid the backdrop of a burnt building or a flooded home, amplifying the already challenging circumstances.

With pre-loss emergency disaster planning in place, however, these headaches can be avoided. Insurance professionals collaborate closely with property owners to establish a clear and comprehensive outline of the necessary claim documentation well in advance of any disaster. Consequently, if flames or floods materialize, the property owner can readily assemble the required documents, enabling the insurance professional to promptly process the claim and expedite the payout. This proactive approach minimizes stress and streamlines the entire claim process, ensuring a smoother and more efficient resolution for all parties involved.

2. Pre-loss planning accelerates the restoration process. After the paperwork is complete and the claims are filed, it's time to start the most important part of the disaster recovery process: property restoration. When there isn't a pre-loss plan in place, this critical step can become complicated and challenging. Insurance professionals and restoration teams must familiarize themselves with the property and its many nuances after the damage has been done so they can properly restore it.

For example, does the property feature sheet rock or plaster? What technology is used for heating and cooling? When there is a pre-loss plan in place, insurance professionals and the restoration team already know the answers to these questions. There's no need to do extensive fact finding amid the rubble. Instead, carpenters, electricians, plumbers and other tradespeople can go to work immediately, getting the property quickly functioning again.

3. Pre-loss planning educates residents and tenants. Property owners — whether they are residential or commercial — frequently are at a loss for what to do in the wake of a disaster. As a result, insurance professionals must spend a significant amount of time providing education during an especially stressful time.

For example, a residential property owner may have a long list of questions about whether their property is still habitable, what they can and cannot touch, and how to arrange alternate accommodations if necessary. Meanwhile, commercial property owners and their employees may ask if and how they can keep the company running despite a damaged place of business. With a pre-loss plan in place, however, this extensive education is done ahead of time, rather than in the middle of a crisis. Pre-loss plans equip property owners, managers, residents and other stakeholders with key information and orders of operations.

4. Pre-loss planning reduces losses. Pre-loss plans have been proven to effectively mitigate financial losses in the event of disasters. Why? Insurance professionals can proactively identify and address potential risks and hazards. These risks may encompass various aspects, such as identifying structural vulnerabilities resulting from old infrastructure or outdated building materials that could pose heightened susceptibility during a disaster.

Additionally, economic risks, such as the lack of a contingency plan for a commercial property temporarily losing access to its headquarters, can also be addressed. By diligently identifying and working to mitigate these risks in advance, insurance professionals can save their clients considerable time and money should a disaster occur.

Through the comprehensive assessment and resolution of potential risks ahead of time, pre-loss planning offers substantial benefits. Insurance professionals can significantly reduce the financial impact of disasters by enabling their clients to proactively address vulnerabilities and implement measures that safeguard their properties and assets. This not only minimizes potential losses, but also enhances the overall resilience and preparedness of property owners and their insurance coverage.

5. Pre-loss planning increases safety. Prioritizing client safety is the utmost responsibility of insurance professionals. One way to achieve this is through pre-loss planning. These plans educate property managers and others on-site about the necessary actions to take in the event of a disaster. For example, the plans can provide information on the location of fire extinguishers, proper building evacuation procedures, functioning of sprinkler systems and more. Having such crucial information readily available not only saves time and money during claims — it can also save lives.

The insurance profession revolves around risk reduction, and proactive planning emerges as the most efficient and valuable approach to mitigate risks. Pre-loss emergency disaster planning, therefore, becomes an indispensable tool for both insurance professionals and the clients they serve. Ensuring that this valuable resource is part of your toolbox can significantly enhance risk management strategies and contribute to more successful outcomes for all parties involved.

Ron Fanish is co-owner of Rainbow Restoration of Westchester. He may be contacted at [email protected].

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