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Don’t skimp on insurance

Randy Fenley knows his business. He’s familiar with its ebbs and flows, and watches the trends. But in all of his years as an insurance broker, he has never seen anything quite like the impact the coronavirus pandemic has had on the industry.

Fenley, an agent with State Farm Insurance in Grand Forks, N.D., said his business has not actually been impacted all that much by the pandemic – not yet anyway – but expects it will start to feel the effects within the next couple of months.

“I think the world is going to recover from this,” he told Prairie Business. “It’s just going to take six months before we start to get the economy back to where it was. I think we’re doing all the right things to make that happen.”

In the meantime, there are some things business professionals and their employees should know about insurance.

Fenley said there is a claim that can be filed for “disruption of business,” but there needs to be a physical loss associated with the disruption, such as caused by fire, flood, vandalism or theft. “There needs to be a sudden and direct physical loss” of property, he said. The things insurance does not cover are acts of war and, unfortunately, disease.

That means disruptions related to the coronavirus are not covered under the disruption to business model.

“This is a new animal that we’re dealing with,” Fenley said. “As you can imagine, if we were paying for the loss of businesses for two weeks, a month, six weeks, until July … we’d be bankrupted. There’s no way to cover that sort of thing.”

Erica Berg, underwriting manager with EMC Insurance in Bismarck, N.D., said much the same thing, but urged business owners to know their policies.

“Looking at this from a policyholder perspective, I think you just need to know what you have,” she said. “Read your insurance policy and discuss it with your insurance agent. I think if anything, just understanding your policy is important. During these times, not understanding what’s out there can cause anxiety.”

Fenley said now is the time businesses and people definitely don’t want to skimp on insurance. But, he warned, don’t buy it the way many millennials often purchase it.

People are used to buying online, he said, and if they’re not satisfied with a product they send it back. With insurance it’s different –though not everyone treats it differently.

His advice: Talk with an agent, ask questions, find out all you can and then make a decision.

Smar