NJM Blog

Mistakes Small Business Owners Make When Filing Insurance Claims

Surprised Hispanic businesswoman working in office.

Business owners know that insurance provides financial protection against unexpected losses. When those times occur, an insurance policy is a wise investment. However, business owners occasionally make mistakes when filing a commercial insurance claim. Here are some common errors to avoid:

  • Not understanding your policy
    Read and fully understand your policy, so there are no surprises regarding covered perils. Contact your insurance claim specialist, who will help you understand the coverages that apply to your loss.

  • Failing to contact your insurer immediately
    A common mistake is waiting to notify your insurer. File your claim when the incident occurs. Waiting could make the claims process more difficult and costly and lags in reporting can lead to increased claim costs, possible litigation, and penalties. Call your insurer as soon as possible to arrange for an adjuster to schedule a site visit.

  • Not documenting damage or injuries
    Documentation is an essential part of filing your insurance claim. Make a detailed inventory of damaged property, including photos and videos, names of witnesses, and copies of any contracts between the parties.

  • Discarding damaged goods
    Throwing away damaged goods or defective items that contributed to an injury could affect your ability to receive full compensation for your losses. They could also prevent your insurance company from pursuing the party that may ultimately be responsible for the loss. In addition, attorneys for anyone injured need an opportunity to inspect and develop a third–party claim. If possible, wait until your adjuster has met with you before throwing anything away.

  • Not working with your insurer
    Your policy requires you to cooperate with your insurer. Working together with your claim specialist can help make the process more efficient. Most importantly, have your documentation ready — including receipts and contracts — and promptly submit them when requested.

The content of this article is intended for informational purposes only. It is not an insurance policy, and does not, in any way, replace or modify the definitions and information contained in individual insurance policies. Terms and coverage availability may vary by state, and exclusions and deductibles may apply. Discounts also vary by state and may not be applied to all policy coverages. Coverage for an accident or loss is subject to the terms and conditions of the insurance policy applicable to a particular claim.