Resources and Best Practices for Businesses Impacted by Fires

Fires can devastate businesses, disrupting operations, damaging property, and resulting in significant financial loss. Whether you’re located in fire-prone areas like Los Angeles or elsewhere in the country, navigating commercial insurance claims after such an event requires preparation, organization, and the support of an attentive broker.

Below, we’ve compiled resources, checklists, and best practices to help you through this challenging process.

Understanding the Impact of the Los Angeles Fires

The recent wildfires in Los Angeles, including the Palisades and Eaton fires, have been some of the most destructive in history. These fires burned around 40,000 acres, destroyed 12,000 structures, and tragically took 28 lives. Businesses across the region have suffered immense losses, with many forced to close either temporarily or permanently. The financial impact is staggering—Goldman Sachs estimates the total damage could reach up to $275 billion, making these fires one of the 20 costliest natural disasters in U.S. history.

National Resources

Fires are not limited to the West Coast. Businesses nationwide must prepare for the possibility of fire damage. Here are key national resources:

FEMA Small Business Administration Disaster Loan Assistance – Provides low-interest loans for businesses affected by natural disasters.
Ready.gov: Business Fire Preparedness – Offers preparedness guidelines for businesses at risk of fires.
National Fire Protection Association (NFPA) Guidelines for Businesses – Provides fire safety standards and risk mitigation strategies.
How Federal Disaster Declarations Affect Insurance Claims and Funding – Learn how federal declarations impact insurance claims and funding opportunities.

Best Practices for Filing a Commercial Insurance Claim

Filing an insurance claim after a fire requires meticulous preparation and thorough documentation. Follow these steps to improve your chances of a smooth claims process:

1. Document the Damage Immediately

Take high-quality photos and videos of damaged property before cleanup begins.
Record the date and time of the incident for insurance documentation.

2. Secure the Premises

Prevent further damage by boarding up windows or securing unsafe areas.
Keep receipts for emergency repairs—these may be reimbursed by your insurance.

3. Notify Your Insurance Broker Promptly

Contact your broker and insurance carrier as soon as possible.
Provide a clear, detailed description of the damage and impact on your business operations.

4. Prepare the Necessary Documents

Ensure you have all required documents before filing a claim:

Insurance policy (declarations page, coverage details, etc.).
Detailed inventory of damaged or lost items, including receipts and photos.
Financial records, including profit and loss statements, payroll records, and tax filings.
Lease agreements or property deeds (for property ownership verification).

Checklist: Who to Contact and Documents to Have Ready

Who to Contact:

Your commercial insurance broker
Your insurance carrier’s claims adjuster
Emergency services (fire department, local disaster recovery office)
Contractors for cleanup and restoration
Legal counsel (if disputes arise with the carrier)

Documents to Have Ready:

A copy of your insurance policy
Inventory of assets with purchase receipts
Financial records (bank statements, tax filings, profit and loss statements)
Photographs or videos of damaged property
Receipts for temporary repairs and mitigation efforts
Contact information for employees, vendors, and suppliers

Best Practices to Prepare for an Insurance Carrier’s Audit

Insurance carriers often audit claims to ensure accuracy and prevent fraud. Here’s how to prepare:

Maintain accurate and organized financial records.
Keep a detailed inventory of assets with regular updates.
Document maintenance and safety measures taken before the fire.
Work with your broker to ensure proper communication with the carrier.
Be prepared to answer detailed questions about business interruption losses, including payroll, rent, and other ongoing expenses.

Essential Coverage for Businesses in Fire-Prone Areas

Proactive planning with the right insurance coverage is critical. Consider these policies to protect your business:

Commercial Property Insurance: Covers the cost of damage to your building and equipment caused by fire.
Business Interruption Insurance: Provides compensation for lost income and operational expenses during recovery.
Equipment Breakdown Insurance: Covers damage to machinery and equipment due to heat or smoke.
Debris Removal Coverage: Helps cover the costs of clearing away fire-damaged debris.
Civil Authority Coverage: Compensates for business interruption caused by government-mandated closures due to nearby fires.

Final Notes: The Importance of an Attentive Broker

The aftermath of a fire can be overwhelming, but working with an attentive and experienced insurance broker can make all the difference. A good broker will:

Help you understand your coverage and file claims efficiently.
Advocate on your behalf during disputes with carriers.
Ensure your policy includes essential coverage to protect against fire risks.
Provide guidance on how to prepare for future audits and inspections.

Don’t wait until disaster strikes—partner with a broker who pays attention to the details and ensures your business is protected.

Apex was founded to fill a gap in the insurance marketplace—a gap left by big agency consolidations that sometimes make clients feel like just another number. At Apex, we bring a boutique, high-touch service back to San Diego businesses and beyond.

At Apex Risk & Insurance Services, we use the Apex Proven Process to learn about your business, strategize to assemble the right program for you, and use our deep industry and market knowledge to leverage the best pricing and coverage.

This leaves small business owners with more time to do what they do best: Run their business knowing that their company and employees are protected.
Check out our commercial insurance policies, then, read on to learn what makes us different.