Assistance for Small Business to Survive Disaster

The aftermath of massive natural disasters, such as the damage seen in the wake of Hurricane Harvey and Hurricane Irma, can break many small businesses. Massive flooding and extensive damage and destruction to properties can result in many small businesses never recovering.

In fact, approximately 40 percent of small businesses affected by a disaster never reopen their doors, according to the Federal Emergency Management Agency (FEMA). The cost of recovering after such destruction is often too great for many small business owners to bear.

While the total damage cost estimates are not yet confirmed, it’s believed that the total cost of damage caused by the disaster already surpasses the damage bill incurred after Hurricane Katrina in 2005. As a result, many disaster relief groups have already begun distributing food, water, and medical supplies throughout flooded areas in Texas.

Bob Ottenhoff, CEO of the Center for Disaster Philanthropy told NPR that his group has created a Hurricane Harvey recovery fund that has already raised more than $300,000. Americares spokesperson Donna Porstner also set up a relief fund that has already sent out shipments of medicine and supplies worth more than $1.5 million to 14 local organizations helping survivors across Texas.

While most business owners invest in some forms of insurance to help protect their business operations, not all business owner insurance policies include flood coverage. To protect a small business against the potential for flood damage, an excess flood insurance policy needs to be taken out with a participating carrier. The National Flood Insurance Program provides such cover, and most commercial policies may also cover flood damage.

In an effort to speed the recovery process, the U.S. Small Business Administration (SBA) will provide a level of financial assistance for business owners located in disaster areas. Since the storm first made landfall near Rockport, a state of emergency has been declared in 50 counties of Texas and across Louisiana.

Small business owners have the option of applying for economic injury loans that can help recoup some of the losses incurred after a disaster. The Small Business Administration (SBA) also offers physical disaster loans. Both loan types are capped at a maximum of $2 million

“The SBA stands ready to assist Texas businesses and residents for the long-term as they recover from the devastation caused by Hurricane Harvey,” the SBA announced In a statement released to CNBC.

Aside from helping small businesses reopen their doors and resume trading operations, the SBA also offers disaster loans to homeowners and renters affected by the devastation caused by Hurricane Harvey. Homeowners can apply for disaster assistance up to a maximum of $200,000, and renters are potentially eligible for up to $40,000.

The SBA advises that loan approvals can take up to four weeks. As such, any small business owners, homeowners or renters intending to file financial assistance claims are urged to submit them as soon as possible.

The Federal Emergency Management Agency (FEMA) provides a range of financial assistance options and safety information for those small business owners, homeowners, and renters who are ready to return home and begin cleaning up and rebuilding after the floods.

FEMA also offers a Flood Mitigation Assistance (FMA) grant program designed to help fund cost-effective measures designed to mitigate the long-term risk to homes, buildings and other structures. Project grants may also be available to help fund projects that may reduce flood losses, including financing the cost of relocation or demolition of some structures and flood proofing or elevating other structures.

The clean-up process can be devastating after such widespread destruction, but it can also be potentially dangerous It’s advised that Texas locals follow the safety guidelines when removing debris and attempting to recover damaged items.

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