Running a business comes with risks, and when the unexpected happens, commercial insurance can be the safety net that keeps your company afloat. However, filing and managing commercial insurance claims can be a complicated and frustrating process. Understanding the most common types of commercial insurance claims and how to handle them effectively can help protect your business from unnecessary financial loss.
Protect Your Business by Understanding Commercial Insurance Claims
At Daly & Black, P.C., we specialize in helping businesses navigate commercial insurance claims and fight back against insurers who delay, underpay, or deny legitimate claims. Below, we break down five of the most frequently filed claims and how businesses can manage them successfully.
1. Property Damage Claims
Property damage claims are among the most common commercial insurance claims, often stemming from incidents like fires, storms, vandalism, or accidents. Businesses that own commercial buildings or valuable equipment rely on insurance to cover the costs of repairs and replacements.
How to Handle Property Damage Claims:
- Document Everything – Take photos and videos of all damages immediately after the incident.
- Review Your Policy – Understand the specific coverage details, including exclusions and deductibles.
- Notify Your Insurer Promptly – Report the claim as soon as possible and submit all necessary documents.
- Get Independent Estimates – Don’t rely solely on the insurance company’s adjuster—seek third-party evaluations to ensure a fair payout.
2. Business Interruption Claims
When a business is forced to shut down due to disasters, such as a fire or hurricane, it can suffer significant financial losses. Business interruption insurance is meant to cover lost income and ongoing expenses, but insurers often dispute these claims by challenging revenue loss calculations.
How to Handle Business Interruption Claims:
- Maintain Detailed Financial Records – Keep records of revenue trends, operating expenses, and payroll before and after the disruption.
- Act Quickly – There are strict time limits for filing claims, so don’t delay.
- Work With a Legal Team – If the insurer undervalues or denies your claim, an attorney can help you recover what you’re owed.
3. General Liability Claims
Businesses can be held liable if a customer, vendor, or visitor is injured on their property. General liability insurance helps cover medical expenses, legal fees, and settlements in such cases.
How to Handle General Liability Claims:
- Report the Incident Immediately – Delays in reporting can raise red flags with insurers.
- Gather Witness Statements – If possible, obtain statements from employees or customers who saw what happened.
- Do Not Admit Fault – Let the investigation determine liability rather than making premature statements.
- Consult an Attorney – If a claim escalates into a lawsuit, legal representation is critical.
4. Workers’ Compensation Claims
When an employee is injured on the job, workers’ compensation insurance provides coverage for medical treatment, rehabilitation, and lost wages. However, insurers may dispute the severity of the injury or deny claims outright.
How to Handle Workers’ Compensation Claims:
- Ensure Immediate Medical Treatment – Employees should seek treatment right away and follow all medical advice.
- Keep Detailed Records – Document the accident, medical reports, and correspondence with the insurer.
- Understand Your Rights – Employers and employees both have rights under workers’ compensation laws.
- Challenge Denied Claims – If a valid claim is denied, legal action may be necessary to secure compensation.
5. Cyber Liability Claims
With businesses relying on digital platforms, cyber liability insurance has become crucial. Data breaches and cyberattacks can result in financial losses and legal liabilities.
How to Handle Cyber Liability Claims:
- Act Fast – Notify your insurer and affected parties immediately after a data breach.
- Provide Documentation – Submit IT reports and evidence of security failures to support the claim.
- Strengthen Cybersecurity – Implement robust cybersecurity measures to prevent future incidents.
- Seek Legal Assistance – If an insurer refuses to cover damages, an attorney can help fight for compensation.
Navigating the Commercial Insurance Claims Process
Filing a commercial insurance claim involves several steps, each of which can significantly impact the outcome of your claim. Understanding how to navigate this process effectively ensures that your business receives the full benefits outlined in its policy. The Insurance Information Institute (III) provides key insights into the steps policyholders should take when filing a business insurance claim to avoid disputes and delays.
Reviewing Your Policy in Advance
Before a loss occurs, it’s essential to thoroughly review your commercial insurance policy. Understanding coverage limits, exclusions, and policy endorsements can prevent surprises when filing a claim. Many businesses only realize gaps in coverage after an incident, making policy reviews a critical part of risk management. According to the National Association of Insurance Commissioners (NAIC), business owners should regularly review their policies to ensure they understand coverage limits and exclusions.
Communicating Clearly With Your Insurer
Effective communication with your insurance provider is key to a smooth commercial insurance claims process. Submit all required documentation promptly and keep a record of your conversations. If the insurer requests additional information, respond quickly to avoid unnecessary delays in claim processing.
Keeping Records of All Interactions
Documentation is a business’s best defense against claim disputes. Maintain a detailed file that includes policy documents, correspondence with the insurer, receipts for repairs, and any written statements from third parties. Having this information readily available can strengthen your case if your claim is challenged.
Consulting a Lawyer When Necessary
If you encounter commercial insurance claims management issues such as delays, low settlement offers, or bad faith tactics, consulting an attorney is the next step. Legal professionals can negotiate with insurers on your behalf and, if needed, escalate your claim to litigation to ensure you receive the compensation you’re entitled to.
What to Do If Your Commercial Insurance Claim is Denied
Receiving a denial for a commercial insurance claim can be frustrating and financially stressful. However, a denied claim does not mean the end of the road.
Requesting a Written Explanation
If your commercial insurance claim is denied, insurers are required to provide a written explanation. This document will outline the reason for denial, allowing you to assess whether the insurer’s decision was justified or made in bad faith.
Gathering Additional Evidence
A denial does not necessarily mean your claim is invalid. You may need to gather additional documentation, such as repair estimates, financial records, or expert evaluations, to support your case. The more substantial your evidence, the stronger your position when challenging the denial.
Filing an Appeal
Most insurance companies have an internal appeals process for denied claims. If you believe your claim was wrongly denied, submitting a formal appeal is the first step toward reversal. The U.S. Small Business Administration (SBA) advises businesses to document all claim-related communications thoroughly to support their case when seeking legal recourse. Working with an experienced attorney during this process can increase your chances of success.
Seeking Legal Help
If all other avenues have been exhausted and your commercial insurance claim remains unpaid, legal action may be necessary. An attorney can help file a bad faith lawsuit against the insurer, forcing them to honor their policy obligations and provide fair compensation.
At Daly & Black, P.C., we focus on commercial insurance claims management, helping businesses seek the full compensation they deserve. If your business is facing resistance from an insurance company, don’t fight alone—contact us today for a FREE consultation.
FAQs
Q: What types of commercial insurance claims are most commonly filed by businesses?
A: The most common commercial insurance claims include property damage, business interruption, general liability, workers’ compensation, and cyber liability claims. Each type of claim protects businesses from different financial risks and liabilities.
Q: How can a business ensure its commercial insurance claim is processed smoothly and quickly?
A: Businesses should document all damages thoroughly, submit claims promptly, maintain detailed records, and communicate clearly with their insurer. Seeking legal guidance can also help prevent disputes and delays.
Q: What should a business do if its commercial insurance claim is denied or underpaid?
A: If a claim is denied or undervalued, businesses should request a written explanation, gather additional evidence, file an appeal, and consult an attorney if necessary to fight for fair compensation.
Protect Your Business – Contact Daly & Black, P.C. Today
Navigating commercial insurance claims can be complex, but you don’t have to do it alone. Whether you’re dealing with property damage, business interruption, or a denied claim, Daly & Black, P.C. is here to help.
Call now for a FREE consultation.