After a tornado strikes, medical facility administrators face complex problems and difficult decisions as they wait for an insurance payment. Small clinics may be forced to close until repairs are complete, while large hospitals may have to send patients to other facilities and struggle to retain key staff members. Attorney Bill Voss explores special property damage coverage options for medical facilities that can help hospitals and clinics recover as quickly as possible.
Vital Tornado Insurance Coverages for Hospitals and Health Care Facilities
When selecting the right commercial property damage insurance for a health care center, administrators should examine both the scope of operations and the particular risks facing their clinics. Once you have created a policy tailored specifically to your needs, you should carefully consider a replacement cost value (RCV) policy to ensure that you will receive enough payment to replace damaged items at their full cost.
Location can also play a role in coverage selections, and it is well worth it to explore state and federal insurance coverages to supplement your private property damage policy. For example, health care centers in certain Texas counties may need a separate windstorm policy through the Texas Windstorm Insurance Association (TWIA) to ensure coverage for caused by natural disasters.
Even if you have a strong policy in place, there may be gaps in your coverage that could cost thousands or even millions of dollars out of your profits. Administrators may wish to consider optional policy endorsements for extra protection, including:
- Cleanup costs. Private insurers may offer basic coverage to pay for cleanup costs after a disaster, but damage to medical facilities can be both extensive and expensive. Removal of broken glass, tree branches, walls, furniture, and other debris can take weeks and require teams of contractors, while only qualified crews can perform hazardous materials cleanup (such as asbestos removal, mold mitigation, and biohazardous waste disposal.
- Code upgrade coverage. Any damaged portion of the property must be rebuilt in compliance with current building codes, as well as meet certain criteria set forth by the health department. Building ordinance insurance can pay for these increased construction costs.
- Special equipment coverage. Every medical facility will have its own specialized equipment, from diagnostic testing equipment (CAT scan or x-ray machines) to dental chairs and hospital beds—and even the computer networks used by patients and staff. All medical and electronic equipment vital to your operation should be specifically listed on your property damage policy.
- Utility interruptions. A tornado can knock out power and municipal services for several days, causing the loss of more than just heating and light. Extended service interruptions can knock out industrial refrigerators and freezers (causing the loss of donated blood or human organs), while lack of power to electric gates and security cameras can increase the risk of theft or vandalism. Utility interruption insurance can cover any losses caused by a lack of electricity, internet, waste disposal, phone services, or municipal water supply.
- Rental coverage. If your facility rents medical equipment from a supplier, these items will need to be covered under a rental insurance policy. Rented items can include MRI scanners, company vehicles, wheelchairs, and other equipment needed for daily operations.
- Business interruption insurance. It may be a struggle to keep your hospital or small clinic open without suffering a significant loss of income. Business interruption insurance is arguably the most important form of coverage for any commercial enterprise, as it can replace normal business revenue during the restoration period. Business income coverage can be used to pay employee salaries, recoup losses from canceled procedures, rent a temporary space to meet with patients, and cover out-of-pocket costs due to an adverse event.
If you need help with your tornado damage insurance claim, we can work to get you full and fair payment to make repairs and reopen your doors. Please contact the Voss Law Firm at 1-888-991-3212 or simply fill out the form on this page today to get answers to your questions.