As hundreds of small businesses begin grappling with the aftermath of the Queensland and Victorian floods, a startling number will be left short, with a growing percentage not covered for business interruption (BI).

Suncorp EGM of Commercial Claims Matt Pearson says less than two-thirds of small businesses have BI cover.

“The reality is that being insured for the cost of building repairs alone may not be enough to save a business from being ruined by a major event,” he told insuranceNEWS.com.au.

He says although most large corporations have BI cover, only 40% of SME businesses have it.

A spokesman for Marsh says BI claims which “typically” take longer to process are likely to comprise a significant portion of total claims in both size and volume.

Suncorp has so far received more than 14,000 claims across its business, home and motor insurance brands.

Mr Pearson says commercial insurance specialist Vero has already started assessing small business claims from the affected areas, with some claims paid and rebuilding commencing.

“We’ve set up a dedicated events response team with assessors on the ground in the flood-affected areas,” he said. “We are also trying to use local suppliers and tradespeople in regional Queensland to support the recovery of local communities.”

He says businesses with BI insurance will be covered for flood-related claims – if the business policy provides flood cover.

“It appears the industry norm is for flood to be excluded from many SME insurance policies, but some insurers like Vero offer flood as an option,” he told insuranceNEWS.com.au.

DLA Phillips Fox Partner Alison Haly has urged businesses with industrial special risks or “all risk” policies to process their initial claims promptly.

“If equipment has been damaged, those losses should be quantified as soon as possible so businesses with appropriate cover can seek progress payments to help them to recover business operations as soon as possible,” she said.