Struck by Lightning: How Businesses Can Become More Resilient – Triple-I and LPI
April 29 2024 - 12:04PM
Business Wire
Fires resulting from lightning strikes cause 3% to 5% of all
U.S. commercial property insurance claims, accounting for billions
annually in covered payouts to small and medium-sized businesses
(SMBs), according to the Insurance Information Institute (Triple-I)
and the Lightning Protection Institute (LPI).
“A lightning strike can have a significant impact on a business
- especially a small business,” said Tim Harger, executive
director, LPI. “The potential consequences, such as business
interruption, loss of revenue, and damage to reputation, can be
devastating. By taking proactive measures to protect their
operations, small businesses can safeguard their livelihoods and
ensure long-term success."
Harger noted that while lightning fires cause structural damage,
what’s even more costly is damaged inventory, production downtime,
and loss of revenue during repairs. “The investment in a lightning
protection system can prevent business interruption,” he said.
National Small Business Week (April 28-May 4, 2024) is a good
time to highlight the importance of properly designed, installed,
inspected and certified lightning protection and grounding systems
that can mitigate this risk to SMBs. The system’s installation
should be accompanied by the business’ purchase of the right types
and amounts of insurance, Triple-I and LPI agree.
According to the U.S. Small Business Administration (SBA), 40%
of small businesses nationwide do not reopen following a natural
disaster, and another 25% fail within a year.
“Insurance allows businesses to recover economically from a
lightning strike,” said Sean Kevelighan CEO, Triple-I. “That’s why
we recommend policyholders take advantage of tools that help
predict and prevent losses from occurring.”
Triple-I and LPI offer these five steps to protecting a
commercial property from damage caused by a lightning strike:
- Install a certified lightning protection system – These
systems provide a specified path to harness and safely ground the
super-charged current of a lightning bolt. Because every building
is unique, building owners should take risk factors into
consideration, including location, frequency of thunderstorms, and
impact to their businesses such as loss of services and revenue.
Properly installed lightning protection systems include utilizing a
certified lightning protection contractor and a third-party
inspection program.
- Secure surge protection – Proper selection and
installation of surge protection devices can protect electrical and
electronic equipment from lightning and other surges that can enter
a building through the electric, telephone, data, or other wires
from outside. Surge protection alone does not protect against the
damage of a direct lightning strike. Installing a complete
lightning protection system which includes surge suppression will
protect a business from the impact of lightning.
- Purchase Property Insurance – Property insurance
coverage pays to repair or replace stolen, lost, or damaged
business property. It covers your business’s structure and other
assets on its premises, like equipment.
- Consider Business Income (Interruption) Coverage – If
your business is forced to close temporarily due to direct physical
loss or damage to your property from a covered cause of loss, such
as a fire or a windstorm, business income (interruption) insurance
can help you replace lost net income during the period of
restoration that you would have earned if no physical loss or
damage had occurred, pay for continuing normal operating expenses,
including payroll, relocation expenses, and advertising if you set
up shop at a temporary site. Also consider utility services
interruption coverage as an endorsement, which covers your business
from interruption of electric, gas or water.
“Business owners, by their very nature, are risk takers. And
that’s a good thing. After all, that’s how they became so
successful. But smart entrepreneurs recognize that business
insurance is an essential element of an overall business plan,”
Kevelighan concluded.
RELATED LINKS Facts and Statistics: Lightning
ADDITIONAL RESOURCES Insurance Institute for Business
& Home Safety
About the Insurance Information Institute
With more than 50 insurance company members — including
regional, super-regional, national, and global carriers — the
Insurance Information Institute (Triple-I) is the #1 online source
for insurance information in the U.S. The organization’s website,
blog and social media channels offer a wealth of data-driven
research studies, white papers, videos, articles, infographics and
other resources solely dedicated to explaining insurance and
enhancing knowledge.
Unlike other sources, Triple-I’s sole focus is creating and
disseminating information to empower consumers. It neither lobbies
nor sells insurance. Triple-I offers objective, fact-based
information about insurance – information that is rooted in
economic and actuarial soundness. Triple-I is affiliated with The
Institutes Risk and Insurance Knowledge Group
About the Lightning Protection Institute
Founded in 1955, the Lightning Protection Institute (LPI) is the
voice of lightning protection and grounding systems manufacturers
and contractors. We are working to improve our companies, elevate
our industry, and benefit the communities and customers we serve.
LPI advances the quality, safety and function of the lightning
protection and grounding systems our members manufacture, design
and install.
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version on businesswire.com: https://www.businesswire.com/news/home/20240429495890/en/
Media Contact: Loretta Worters, Insurance Information
Institute (Triple-I), 917-208-8842; lorettaw@iii.org