The morning after Hurricane María swept across Puerto Rico, business owners walked into their offices, if they still had walls standing, thinking, “Good thing I have insurance”. But what many discovered was even worse than the physical damage: policies that looked solid on paper, but failed in practice.

A survey by the Federal Reserve Bank of New York found that while a majority of small businesses had some insurance, few were fully covered. Most had basic property insurance. Wind, flood, and business interruption insurance? Only one in five had them. Even worse, only 4% of businesses with insurance had losses that were fully covered.

In other words:
Flooding? Not covered.
Inventory? Underinsured.
Business interruption? Only if you had that rider.
Deductible? Higher than your emergency fund.

So now I ask you, not as your CFO, but as someone who’s seen what can go wrong: When was the last time you actually read your policy?

The Illusion of Coverage

Most business owners don’t read their full policy. They sign it, file it, and hope they never have to think about it again. Until something happens. And when it does, that’s when the surprise hits: the damage isn’t covered the way they thought, or at all.

Just because you pay for insurance doesn’t mean you’re protected. Coverage isn’t about having a policy. It’s about having the right one, written with your actual operations, assets, and risks in mind.

And this isn’t fear talk. This is experience talking.
I’ve seen businesses completely shut down not because of the storm, but because of what was missing in their policy. One overlooked clause. One excluded asset. One undefined term, and that’s all it took. It’s not enough to have coverage. You have to understand it.

What Else Went Wrong

Flood damage wasn’t included in most standard policies.
Inventory and equipment were undervalued, or not listed at all.
Backup systems, like generators, weren’t scheduled.
And power? Businesses that couldn’t operate without electricity had no coverage for utility loss.

One business had coverage for the building, but not the contents. They lost over $250,000 in inventory. Another had business interruption insurance, but only after 60 days of downtime. Power didn’t return for 83.

And in many cases, even those with the right policy couldn’t get paid, because their books weren’t ready. No monthly P&L. No expense breakdown. No proof of what they earned before the storm.

That’s what is really important and some business owners don’t understand, insurance doesn’t work in a vacuum. It needs data.
If your financials aren’t clean, timely, and complete, your claim, especially for lost income, may not hold.

What could’ve been a six-figure reimbursement becomes a back-and-forth headache and a slow drip of partial payments, if anything at all.

The truth? Your insurance is only as strong as your accounting.
If your numbers are a mess, there’s no way an insurer can put your business back where it was before the disaster. That’s not just a paperwork issue. That’s a survival issue.

What You Should Review—Now

If you haven’t done a full policy and financial check this year, start here:

1. Business Interruption Coverage

Review the waiting period, how long coverage lasts, and whether utility disruptions (especially electricity) are included. Ask if your policy covers claim preparation fees and whether there’s an extended period of indemnity. Know exactly what documentation is required to file a claim.

2. Accounting Records & Readiness

Keep monthly profit and loss statements, payroll records, and sales reports up to date. This is how insurers calculate your loss. If you don’t close your books monthly, start now.

3. Flood and Windstorm Insurance

Never assume it’s included. Confirm that storm surge, wind-driven rain, and flooding are covered. Ask about deductibles and exclusions tied to natural disasters.

4. Equipment, Inventory, and Generator Coverage

Make sure critical equipment, inventory, and backup systems are listed, especially if your business depends on refrigeration, electronics, or machinery.

5. Growth Adjustments

If your revenue, staff, or locations have grown, your coverage might be outdated. Update your limits to reflect your current reality.

6. Contingent Business Interruption

If you rely heavily on a key supplier or service provider, make sure you’re covered if they go down, even if your business isn’t directly hit.

7. Annual Review Process

Add insurance and financial readiness to your year-end checklist. This isn’t just compliance. It’s part of protecting your business strategy.

Cafecito Takeaway

You can’t control the weather, the power grid, or the unexpected.
But you can control how prepared your business is to face it.

Insurance isn’t just a checkbox, it’s part of your financial strategy. Right alongside clean books, solid reporting, and operational resilience.

Before the next emergency puts your systems to the test, block time to review your coverage and your numbers. They should both tell the same story: “We’re covered. And we’re ready.”

If this has been sitting on your to-do list for months, no judgment. Just pull out that giant PDF your broker sent and:

1. Schedule a 15-minute review call with your broker. Ask specific questions.
2. Update your coverage if you’ve grown, moved, or upgraded equipment.
3. Add insurance to your CEO Day checklist, because risk management is part of growth.

You’ve worked too hard to let one storm set you back years. This isn’t just about peace of mind. It’s about protecting the future you’re building.

Want a simple checklist to review your business insurance? Just download the Insurance Readiness Checklist and get it done, without overthinking it, and definitely before the next storm shows up uninvited.