Hurricane Risk Management: Is Your Business Ready for Atlantic Hurricane Season 2024?

Atlantic hurricane season is here, along with the necessity for business protection and hurricane risk management and planning. The increasing financial toll of natural disasters and operational disruptions over the past two decades continues to evolve, showing no signs of tempering.

Hurricane Ian hit Florida in September 2022 and caused an estimated $60 - $100 billion in insured losses alone. This figure is compounded when you include uninsured losses. According to a recent National Oceanic and Atmospheric Administration (NOAA) analysis, the distribution of damage from U.S. billion-dollar disaster weather events from 1980 to 2022 is dominated by hurricanes. Hurricanes have caused the highest average weather event cost at approximately $22.2 billion per event.

These sobering statistics of escalating costs and devastating business impacts of hurricanes should compel urgent action within your organization to prioritize proactive hurricane risk management. If you've been fortunate to make it through past hurricane seasons unscathed, don't rest on your laurels. As a notable quote from Benjamin Franklin goes: "By failing to prepare, you are preparing to fail."

It's Not Too Late for Proactive Hurricane Risk Management

Now is the time to review, refresh and adjust existing business continuity plans; get your team informed to be on the ready; have discussions with your key insurance brokers; touch base with your external disaster response advisors; and talk to your insurance claims experts who are constantly dealing with losses to learn what's new and how changing conditions with insurance and FEMA reimbursement may affect a potential loss recovery for your organization. It’s not too late. By employing a ready-for-anything organizational mindset, businesses can effectively shield their interests, curtail potential losses and hasten the insurance claims financial recovery process.

These pre- and post-loss tips can help your organization refresh your hurricane risk planning:

Hurricane Risk Management - Pre-Loss Prep:

• Strategically review or devise an emergency plan tailored for your business, delineating clear roles and responsibilities for immediate action post-loss.
• Establish and regularly practice robust communication protocols to ensure all employees are versed in emergency procedures.
• Strengthen structures, secure unfastened objects and consider incorporating hurricane shutters or impact-resistant windows.
• Shield essential equipment and data from probable damages.
• Execute more frequent data backups to off-site or cloud storage. Establish remote work provisions to maintain business continuity in the event of evacuations or closures.
• Liaise with your insurance broker or advisor to fully understand your comprehensive coverage against possible hurricane-induced threats, including limits, sublimits, deductibles and potential exclusions.
• Assemble and ready your loss recovery team, including as appropriate: operations and accounting colleagues, brokers, claims advocates and forensic accountants/claim preparation consultants.

Hurricane Risk Management - Immediate Steps Post-Hurricane:

• First and foremost, confirm the safety of reentering your business facilities. • Activate loss recovery team.
• Act swiftly to prevent further damage, such as boarding up broken windows or covering damaged roofs.
• Survey for structural damage, gas leaks or potential electrical risks. • Heed all guidance issued by local authorities.
• Document all damages through photos and videos to aid in insurance claims. Use new technologies to enhance this process.
• Construct a comprehensive inventory of damaged assets, including equipment, inventory and infrastructure.
• Retain damaged items as evidence for insurance claims, if feasible.
• Promptly contact your insurance provider to report your loss and initiate the claims process.
• Keep meticulous records of all exchanges with your insurance company.
• Retain all receipts for mitigation efforts as these may be eligible for reimbursement.

For more information about hurricane risk management and planning for hurricane losses, or if you are currently dealing with a disaster and need advice on cost preparation and insurance/FEMA recovery, contact Imperium to speak with one of our hurricane risk management experts.