Prevent debt from being part of your recovery process

No business owner can predict severe weather, let alone how a storm will affect his or her company. What is even more unforeseen though, is how long the recovery process could take. Organizations that do not have a general business insurance policy, or have coverages that do not account for all aspects of the company, could face a difficult recovery.

Owners who do not have commercial property insurance could be forced to pay for expenses out of pocket, or they might need to take out an extreme amount of loans, which could push them further in debt.

That is what happened to businesses in Cedar Rapids, Iowa. Five years ago, the area experienced serious flooding where nearly 1,000 homes were destroyed. According to an article in The Gazette, just last week the town held a ceremony to remember the day when the river crested.

Gary Ficken, owner of Brimm Ridder Sportswear, told the news source that his company was completely flooded and that he led a small business recovery group to try and help other organizations. Ficken explained that he was told by disaster authorities that 55 percent of the city's 1,000 flood-impacted businesses would be closed in three years.

While only 18 percent of the local companies stayed closed, Ficken added that it means 170 businesses and 2,500 jobs were still lost. Furthermore, half of the organizations that are still open have taken on more debt in order to remain open, he said.

Borrowing money, whether from a bank or family and friends, can help business owners get back on their feet but it will not be enough for long-term stability. Partnering with commercial insurance specialists who understand your business can help company leaders find comprehensive coverage for their firms.

 

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