What lessons can be learned from a natural disaster that has caused billions of dollars in property losses, lost income and a lengthy recovery for many businesses? Preparation is the one constant that enabled some companies to limit their losses. Lack of preparation added to the problems most companies experienced and months after the initial storms the problems keep mounting.
Businesses that choose to locate in the coastal regions of Florida, and in fact the entire southeast, do so with the knowledge that hurricanes are a certainty. It is not an “if” so much as a “when” question. The failure of a business to plan for an eventual hurricane borders on business malfeasance. The 2004 hurricane season will bear witness to the demise of many businesses, the unnecessary loss of jobs and staggering insurance costs.
As Hurricane Charley took aim on the west coast of Florida, national flood restoration companies were poised to respond. Millions of dollars in drying and dehumidification equipment, trucks, generators and trained technicians were ready to begin the emergency clean up and restoration.
Hurricane Charley came ashore on the west coast of Florida, the first such hurricane in over 20 years to visit that area. Winds topping out at over 130 miles per hour tore the roofs off thousands of buildings. Twelve inches of rain followed immediately thereafter. On a daily basis, after hurricane Charley left, incessant heat, humidity and tropical rains followed. Flooded contents, heat, humidity and no electrical power, turned buildings into mold factories.
Most companies affected by the storms had no plan, the birthplace of bad ideas. Worse, they had no idea of the magnitude of their problem that resulted from the failure to act. Millions of dollars of restoration equipment sat idle while businesses tried to come up with a plan, contact their insurance company or find a restoration contractor.
Insurance companies were overwhelmed as well. There were not enough adjusters on site and in most cases it took days to get an agent or adjuster on the phone. Wasted time, added expense and mold continued to grow each wasted hour. Many companies were unaware of the extent of their coverage or what was and was not covered.
A bad plan beats no plan. For the few forward looking companies the hurricane story was quite different. A plan was in place, a contact list was available, and an understanding of their insurance coverage was also a known fact. With little delay emergency generators were going, temporary roofing was installed, HVAC systems could be activated and the restoration process was under way within a day or two. Mold will not be a factor in the recovery process of the buildings that had a disaster plan.
Experience is a hard teacher, and the painful experiences of “Hurricane Season 2004” will leave hard-learned lessons in their wake. If your business was lucky enough to avoid the destruction this time, it is a great time to learn from the mistakes of others.
Lesson 1: Make an appointment with your insurance agent now. Find out in detail what coverage you have in the event of a natural disaster. Are you covered for water damage, if so under what circumstances? You may be covered for water damage caused by wind, but not floodwater from rising tides. If you are a tenant in a building do you know if the building owner has proper coverage?
There are many causes for water damage besides storms. What will happen if your building is flooded by carelessness of another tenant or a leak caused by faulty plumbing or sprinkler system? Ask about deductibles to your policy. If you opt for a large deductible to reduce your premium, you should have the deductible amount in a cash reserve. When you are done with the interview with your insurance agent, write down your findings. Once you put the policy away the facts will soon be forgotten.
Lesson 2: Establish an emergency team, complete with contact names, numbers and after hour or cell phone numbers. Who is going to get the ball rolling? What are the first steps? Update this list often and post the emergency contact list where it can be easily found. Put someone in charge of the emergency team and name an alternate or back-up.
Lesson 3: Retain a restoration company with the ability to deal with your unique situation. All restoration companies are not created equal. Most companies are capable of handling small water losses and will do an excellent job if the problem is limited to a portion of your building.
When disasters strike, the number of companies that can provide the resources and trained technicians are more limited. The “large loss” restoration business involves a huge investment in inventory and equipment. Generators, portable cooling units, trailer mounted drying equipment, large dehumidifiers, trucks and emergency construction capability separate the specialty contractors from you local water damage contractor.
Find a contractor that can deal with the “worst case.” A contractor without proper equipment and resources will probably make your situation worse rather than better. Ask for references and consult with your insurance agent about the reputation of the “large loss” contractor. Valuable time can be saved and total restoration costs greatly reduced when the right tools are brought to the right job.
It is, after all, the responsibility of business owners to keep their business going, to limit down time and the loss of income due to business interruption. Learn the lessons so dearly paid for by recent storm victims. Get disaster plans going today, you are going to need them one of these days.
