Hurricane Ivan killed more than 100 people and caused billions of dollars in property damage as it made its way across the Caribbean Sea and hit the U.S. Gulf coast. The storm also set off tornadoes, causing yet more destruction.

In addition, the storm wiped out power to several regions, made roads impassable, and shut down telephone service. In some areas, such as the Cayman Islands and Jamaica, looting was reported, and authorities had to institute curfews as they worked to restore order. In less stable areas as well as those without food and water supplies, businesses had to contract with private firms to evacuate their people after the storm passed.



Looting was a major problem on the Island of Jamaica, and the government imposed a dusk-to-dawn curfew in major cities. There were 12,000 people in more than 280 government shelters.
CNN.com, 9/12/2004

In the aftermath of the storm, businesses will work to get back to business as usual. They will assess damages and begin the process of putting together insurance claims. Even businesses that were not directly affected by the storm should take the opportunity to assess how prepared they are for a hurricane or other natural as well as man-made catastrophe. And they should explore resources available to assist them in times of disaster.

To determine how prepared they are for a natural disaster or other emergency, business executives should begin by asking several questions such as:

• How can we determine when it is safe to return to the premises?
• What private resources are available to help protect our business from looters?
• If it becomes necessary, how can we evacuate our employees safely and in an orderly manner?
• Do we have a crisis management plan in place?
• If local agencies are unable to distribute relief supplies to our employees, what resources are available to enable us to help our people?
• Do our property policies cover us if we suffer damages?
• How should we adequately capture, manage, and report damages?
• Have we established accounting and technical protocols to accurately measure and track the extent of our losses?
• How can we recover data stored on hardware that was damaged or destroyed?
• Have we accurately accounted for all business interruption losses and recovery costs?
• How should we present our claims to ensure the maximum recovery from insurers?
• If we suffer damages from more than one storm, how can we ensure we attribute losses to the correct event?
• If we cannot recover insurance claims, how can we recoup losses?
• Do we have the expertise and experience required to prepare, file, and negotiate our claims?

Filing Insurance Claims
As order is restored, organizations will begin the process of filing insurance claims and trying to get back to business as usual. Given the nature of the devastation and insurance policy coverage triggers the complexities related to obtaining a full recovery and restoring business operations should not be underestimated.

While much attention will be paid to the loss of property, businesses will need to account for business interruption losses and recovery costs. For example, losses related to the inability to enter property as a result of emergency decrees by government officials (Civil Authority coverage), or those that are attributable to a loss of utilities (i.e., spoilage due to a lack of power), may need to be taken into consideration.

Those businesses not directly in Hurricane Ivan’s strike zone, but engaged in business with affected companies in the Caribbean or U.S. Gulf states, should closely review supply chain or other operational impacts and their policy coverages, as they too may be eligible to file claims with their insurers.

As soon as possible, organizations should review their policies and coverage with their brokers or agents, and work to determine what aspects of the loss are covered as well as the documentation required by insurers. Coverage areas may include: property damage including spoilage, business interruption, extra expense or other time element losses, such as service-interruption/off-premises power, civil authority, and ingress/egress. An evaluation and understanding of coverage, deductibles, and triggers, as well as filing requirements, are critical in expediting the claims recovery process and any discussions with insurers.



Hurricane Ivan has unleashed a series of destructive tornadoes in the southeastern United States. Reports of the number of people killed in the U.S. vary but the Associated Press agency says at least 22 died. Ivan has also killed some 60 people in the Caribbean, with Grenada, Jamaica, and the Cayman Islands worst hit.
BBC News, 9/17/04

Marsh’s forensic accountants and professionals with construction expertise can help organizations measure and document all aspects of property damage, business interruption, and extra expense damages. At the same time, they can assist in establishing processes and accounting protocols to track loss-related costs and expenditures. Engaging in such a rigorous process will allow organizations to determine initial damage estimates, and lay the groundwork for more detailed loss measurement and recovery.

Both Marsh’s Risk Consulting Practice as well as Kroll, which was recently acquired by Marsh, can provide services to help businesses respond to the damages and interruptions caused by Hurricane Ivan. Marsh and Kroll professionals can assist in protecting employees and property as well as to begin the process of calculating damages and working on insurance claims in areas that have been stabilized.

In areas that remain unstable, professionals from Kroll can assist organizations by providing security services as well as medical assistance. With ex-military as well as medical professionals, Kroll can help tend to the injured and assist in safeguarding employees. If evacuation becomes necessary, Kroll can not only provide aircraft but also assist in evacuating employees in a safe and orderly fashion. In addition, Marsh’s crisis professionals can deliver relief supplies and assist in managing the overall human impact of the emergency.

It is vital that organizations take the time to engage in a full review of their policies, and agree with their insurers on a detailed loss management plan, so that they can maximize the possibility of a full recovery with their insurers.

Though no one can predict with complete accuracy when, where, and with what force a hurricane will hit, businesses should be ready to account for losses that occur when a storm like Hurricane Ivan strikes, so they can move quickly to recover and re-establish business as usual.

If you have any questions or would like additional information, please contact us.