Small businesses are the backbone of Hawaiʻi’s service-oriented economy. However, the island state is particularly vulnerable to damage from natural disasters, such as hurricanes, tsunamis, and volcanic eruptions. Business insurance protects local small businesses from the devastating financial impact of weather-related damages by helping them to quickly recover and rebuild.
When comparing policies, consider the important role of insurance in supporting Hawaiʻi’s small businesses after disasters.
Common Disasters in Hawaiʻi
As a small business in Hawaiʻi, you are susceptible to several common disasters that could significantly disrupt your day-to-day operations. Flooding, hurricanes, tsunamis, and volcanic eruptions are some of the most damaging events that can lead to costly property damage, increased operational costs, and loss of income.
Business insurance helps protect against these risks by providing financial support in these challenging events. By investing in personalized commercial insurance, small business owners can protect their livelihoods and maintain financial strength in the face of natural disasters.
Types of Business Insurance to Protect Against Risks
No business is immune to disasters that could happen unexpectedly. Carrying business insurance can help safeguard your small business against the financial impacts of disasters by covering repair costs, replacing lost inventory, and compensating for lost income during recovery periods.
Choosing the right business insurance can make all the difference, especially when you work with an experienced agent who can personalize policies to your specific needs and who is familiar with the area and the possible weather hazards.
When building your business insurance policy, consider the following types of coverage to quickly recover and rebuild after a disaster:
Property Insurance
Property insurance is recommended for all small businesses and especially those that operate in disaster-prone areas. If you operate a small business in Hawaiʻi, personalized property insurance can protect you from the costs of repairs or replacements of important equipment, inventory, and facilities.
Business Interruption Insurance
Disasters in Hawaiʻi are often accompanied by unexpected closures that could range from a few days to several months. When a disaster affects your business, causing you to experience a loss of income, business interruption insurance steps in to cover lost income and ongoing expenses, such as rent and utilities.
This support can keep your business going during periods of temporary closures and prevent you from having to turn to layoffs. Business interruption insurance can also help your business facilitate a smooth transition back to normal operations.
Liability Insurance
If your small business is in the path of natural disasters, consider carrying liability insurance. This coverage can protect your business from legal claims and other financial losses that result from accidents or injuries that occur on your premises.
In the aftermath of a disaster, the risk of such incidents often increases as businesses work to recover and rebuild. Having adequate liability insurance to cover legal fees, medical expenses, and settlements can prevent your small business from getting financially overwhelmed by unexpected claims.
Flood and Earthquake Insurance
While not generally required by law or covered in standard policies, both flood and earthquake insurance can financially protect your small business against these specific events.
In Hawaiʻi, flooding can occur due to earthquakes and heavy rainfall. Having this specialized coverage can prevent your business from having to pay for damages out-of-pocket.
Standard policies cover lost inventory, repair costs, and business interruption, allowing you to recover quickly after a disaster.
Benefits of Business Insurance for Recovery & Rebuild
Business insurance serves an important purpose in disaster preparedness. It helps in financially supporting your business during the recovery and rebuilding phase after a disaster by covering the cost of lost inventory, damaged property, and lost income.
By providing a financial safety net, it allows you to focus on rebuilding your business rather than how you’re going to come up with the money to pay for immediate expenses.
Having access to necessary services and resources allows you to restore your business’s stability and achieve a smoother transition back to normalcy.
However, carrying business insurance may also help your business in unexpected ways after a disaster. For example, insured businesses often have an easier time getting grants and loans for recovery efforts.
Let Atlas Help You with Disaster Preparedness
Small businesses in Hawaiʻi are not strangers to natural disasters. However, being prepared for hurricanes, floods, and other harsh weather conditions can help your business stay financially protected and respond effectively when a disaster occurs.
At Atlas Insurance in Honolulu, we have helped countless small businesses build personalized insurance packages that address their specific needs for more than 90 years.
Contact our agency today to see how we can help you protect your small business before disaster strikes.