There are numerous risks involved with owning a business. Fortunately for business owners, some risks can be mitigated by purchasing insurance coverage. Common types of business insurance include general liability coverage, professional liability coverage, commercial auto insurance, workers’ compensation insurance, and cyber liability coverage. In the event your business is harmed, you can file a claim to recover your losses. Unfortunately, it’s not uncommon to have a claim denied. When that happens, it’s important to know about Mississippi business insurance disputes.
According to the U.S. Small Business Administration, there are over 250,000 small businesses in Mississippi—accounting for 99.3% of all businesses in the state. As a result, nearly 435,000 people are employed through those locations. As the business community grows through Mississippi, it’s important for those owners to protect their businesses with the right types of insurance. To understand why you may need to file a dispute, let’s start by taking a look at common insurance claims.
Common Business Insurance Claims
Approximately 40% of small businesses submit insurance claims within a 10-year period. That means that most businesses require general liability insurance, if not more substantial policies. As a business owner, it’s important to be aware of the most common insurance claims. There’s a chance at some point you’ll have to deal with one of these issues. The most common business insurance claims include the following:
- Natural disaster. A natural disaster can happen at any time and they’re generally hard to predict. Even if you know a storm or event is coming your way, you may not have the time or resources to secure your business. Depending on where you live, you could experience hurricanes, tornadoes, severe winter storms, and more. It’s estimated that 25% of small businesses are forced to close after a natural disaster and are unable to reopen.
- Fire. Business owners aren’t always aware of the amount of damage a fire can cause. It also takes a significant amount of money and time to get a business back in working order after a fire because of the amount of property damage and loss.
- Burglary and theft. No matter what type of business you run, you could be at risk of burglary or theft from an angry customer, petty criminal, or a disgruntled past employee. This is the most common kind of business insurance claim, accounting for approximately 20% of all commercial claims filed.
- Customer injury. If a customer or client falls on your property, you could be vulnerable to a lawsuit. If members of the public frequently visit your place of business, it’s important to have the proper liability coverage. If someone gets hurt, you’ll be able to submit an accident insurance claim.
If you’ve experienced one of the events above and have filed a claim, there’s a chance you could be denied. When that happens, it’s important to understand your rights and how to dispute the matter.
What to Do If Your Business Insurance Claim Is Denied
When an insurance claim is denied it’s important to determine why. There are a number of common reasons insurance companies deny claims, including missed deadlines, lack of coverage, and suspected fraud.
When you file your initial claim, it’s important to understand your policy and its restrictions. If you do not have the proper coverage for the event your business has been through or you were unaware of filing deadlines, you’ll likely run into a denial. If that happens, you can dispute the denial. Because of how complex the process is, it’s best to work with an experienced attorney.
Before you contact the insurance company to fight the denial, you’ll want to ensure you have your evidence in place. Review your plan and have your lawyer look over the fine print for any policies that could give you issues. Once you have your reason as to why you believe your claim should not have been denied, you can write a response letter to the insurance provider.
Depending on the situation, you may be able to work out a fair settlement with the insurance company. If that’s not an option, you have the right to go to small business claims court over the dispute. Your lawyer will make sure you have the best chances at a successful case.
The Impact of the Coronavirus on Mississippi Businesses
Because insurance companies want to protect their bottom lines, it’s not uncommon for more businesses to receive claim denials when a natural disaster or event affects a large number of insured businesses. With the spread of COVID-19, it’s likely a number of businesses will file claims because of mandatory closures. If you’re in this situation, it’s important to know how to act.
When a business purchases business interruption insurance, they may believe they will be covered in the event of a pandemic that requires them to close their doors and lose a substantial amount of money. Unfortunately, many policyholders do not realize that business interruption insurance only kicks in when there’s physical damage to a building. It’s unlikely businesses will file successful claims for a virus, bacterium, or other microorganisms because they’re not usually a covered peril.
Currently, insurance companies do not offer policies explicitly covering the coronavirus. As such, it’s important for businesses to adjust to changing demands by shifting business models. This is challenging, but it will reduce losses in the long run.
If you choose to file a claim for COVID-19 related losses and are denied, Corban Gunn, Attorney at Law can look into your case and help you determine what the best course of action is to protect your business.
Get Help From Corban Gunn, Attorney at Law
If your business has been harmed as a result of COVID-19 or another disaster, filing an insurance claim can put you on the path to receiving the compensation you need to keep your business afloat. When you run into problems with the insurance provider, however, it’s important to understand your rights and Mississippi business insurance disputes.
Corban Gunn, Attorney at Law is dedicated to providing Mississippi business owners with the legal advice and guidance they need to make the best decisions for their business. If you have questions about your insurance policy or need help after a denial, contact our office. We’ll begin by reviewing your situation and providing you with the information and resources you need to make the best decision for your business.