ST. LOUIS, Mo. — I’m no meteorologist, but I can see what’s been happening since the year began: We’ve been hit with record ice and snowstorms in places that rarely receive it.
And this troubling weather “report” doesn’t end there. The country has experienced more than double the usual number of tornadoes, record-breaking rainfalls and hailstorms, and flooding. And hurricane season only recently began!
Since we have no idea if these weather occurrences will continue or subside, it’s better to be safe than sorry when it comes to taking care of your self-service laundry.
Loss of Business
If you feel a bit lost when it comes to understanding insurance matters, you’re not alone. There are some items of coverage that most self-service laundry owners just don’t think about. For example, most of you have loss-of-business income, but that only applies when there is a direct physical loss at your location. When you are out of business due to power failure from a storm, you need a coverage known as utility services-time element.
If you’re a store owner in a coastal area, you are probably aware of utility services-time element coverage due to the probability of hurricanes. After a major hurricane, a city may be without power for weeks.
Utility services-time element coverage is an extension of your loss-of-business income due to damage that occurs away from your premises, like downed power lines or a damaged water supply. Again, this coverage is usually not that expensive, but it’s important not just in coastal areas, but in any area due to the variety of weather events that may occur.
Things may not improve when the power returns. You may turn your washers and dryers on and discover that some of them are not working. The equipment may be damaged by a power surge. To deal with this problem, you should carry utility services-direct damage coverage, which pays to repair equipment that has been damaged due to a loss that occurred away from your premises. This coverage is not expensive, and I believe it’s worth the investment.
Flood is an exclusion on virtually all commercial insurance policies. Flood coverage for building and personal property can be purchased through the National Flood Insurance Program. If you are near a body of water that could flood, ask your agent to get you a flood quote.
Earthquake is another exclusion, but it can be purchased from most insurance carriers. If you are concerned, simply call your agent and you should be able to get a price for earthquake coverage.
Think about your customers in these situations. If you have a true bailee policy, and not just personal property of others, the clothing in your laundry is covered for flood and earthquake. If you are doing drop-off service or farming out drycleaning, you should have bailee coverage included in your insurance package and not just personal property of others.
Bailee also covers the clothing when it is away from your premises, such as when it is being transported to the drycleaner you are partnered with. Personal property of others is only covered at your premises.
Most of you are probably aware of Mark Twain’s famous saying, “Everyone talks about the weather, but no one does anything about it.” That may be true, but if you give your insurance situation some thought and are prepared, you reduce the odds of weather getting the best of you.
Tomorrow: How the SBA steps in to help after disasters...
Have a question or comment? E-mail our editor Bruce Beggs at [email protected].