Sandra Jones, a partner at Weightmans (Scotland) LLP and specialist in insurance law, shares her expertise in protecting businesses and commercial property from flood damage
Although Spring has now sprung, large parts of Scotland have taken a battering in recent months from a series of storms and extreme weather with devastating floods experienced in parts of the country. Many Scottish businesses are therefore counting the cost of the damage caused.
With extreme weather events seemingly becoming increasingly common, many of those affected or those potentially at risk of future flooding may be wondering what steps they can take to protect their properties and businesses from future flooding.
Am I at risk? – It’s important that you find out. It could save you money, minimise the damage to your property and could even prevent the risk of injury or worse.
Risk to properties may not be immediately obvious if your business is not located in a waterside or coastal location, however it could still be significant.
It’s vital that owners and occupiers inform themselves as to the risk of flooding, both in relation to the acquisition of properties, or in relation to existing properties. Useful information is available from a variety of sources including the Scottish Environment Protection Agency. If considered justified, a professionally undertaken flood assessment can be obtained.
If your business is flooded, it can be costly, not only in terms of money and time but also inconvenience and heartache. Whilst it is impossible to completely flood-proof a property, there are lots of things that can be done to reduce the impact of flood damage. It is vital to act now so that you are prepared if flooding is anticipated in the area and your property is at risk.
Protect your property – whether you own or rent your business premises, there are steps that can be taken to protect them. Some may be straight forward and temporary such as sandbags or the moving of valuables away from areas most likely to be affected by flood. Others may involve more permanent or structural alterations or modification to the property.
If a property is deemed at risk of flooding, it is crucial that the owner ensures a flood plan is in place and that occupiers are signed up for flood alerts. A flood plan can be of great assistance in providing a practical guide to follow in the event of a flood and include details of important contacts and a checklist of actions to minimise damage and disruption. It is crucial that occupiers are familiar with their insurance arrangements and check that adequate flood insurance cover is in place.
Occupiers should pay particular regard to the danger of being underinsured. It has been reported that a significant proportion of those affected by the recent floods did not have adequate insurance in place. Be careful to check that your insurance will cover interruption to business and loss of profits, as this may not be included as standard.
Those having any difficulty in obtaining insurance may wish to consider contacting specialist insurance brokers who have access to insurers that specialise in flood risk cover.
Insurers should be contacted as quickly as possible following a flood to ensure that the process of repairing and reinstating the property is underway as quickly as possible. Evidence should be kept detailing the extent of the damage including photographs or video footage where possible, and all documentation available to support the loss provided.
Those affected may suffer extreme financial pressure and should familiarise themselves with the additional support or grants that may be available to assist them in their recovery.
Local authorities, major banks and HMRC have sought to be as sympathetic as possible and discretion applied in relation to meeting liabilities in circumstances where businesses have been the victims of flooding.
The First Minister has recently announced that every household and business in Scotland directly affected by flood water will receive a grant of £1,500 with businesses whose trade was affected being eligible to apply for a further £3,000.
However, this will not cover the long-term damage for many, and insurance will have to take up the slack – therefore it is vitally important, whatever the time of year, to ensure adequate protection – especially in Scotland where as we all know, it’s hard to predict what the weather might throw at us.