Protecting Your Finances From Natural Disaster

financial lossFlooding, fire, and storm damage can happen to anyone. While there are certain things you can do to protect your home, there's not much control you'll have over mitigating the damages if lightening strikes your electrical box or flood waters rush through the property. You can, and should, look into different protocols to protect your property more thoroughly - best practices for fire safety or flood gates installed on property where water is an issue. But damage to property isn't the only thing you should seek to limit. When a family suffers a natural disaster, the monetary strain can be more damaging than the storm. Severe financial losses can compromise your ability to pay your bills, negatively impact your credit and savings, even deplete retirement and college funds. These losses can also put stress on marriages, relationships, and your health. While the concrete things you can do to help avoid disaster are important, there are measures you should take to protect your finances, both prior to any disaster and in the days/months immediately following.

Top Tips To Protect Your Finances From Natural Disaster

  1. Proper Insurance. Insurance is one of those things people realize they need, but don't pay much attention to otherwise. Before you have any disaster, you should read through your policy and check what exactly is covered. Have a discussion with your agent on the best type of policy for your area and make sure you don't leave out things - like whether your insurance will cover sewage backup (often a separate policy) and what the deductible is in case of smaller, but still burdensome, damages.
  2. Document Everything. Once damage has occurred, document everything. Take pictures of all of your items and all of the damage to your home. Itemize exactly what was lost. Having this information readily available will help you with any claims.
  3. Has Your Area Been Categorized as a Natural Disaster? If your area has been categorized as a natural disaster, there will be help from government entities and likely charitable organizations, such as the American Red Cross. Go online or in person to your town hall and ask about where to find the information you need to file claims and request help.
  4. Calmly Budget. Don't throw every ounce of your savings at the problem. If there are large scale repairs, work with the contractor to arrive at a payment schedule that you can meet without depleting your savings. You may also need to scale back bills and live a little more simply while you pay for some of the extra costs.
  5. Vet Anyone You Hire. The sad truth is that during a natural disaster scam artists come out of the woodwork to take advantage of your panic. Vet any contractor or repair service and don't just go with the cheapest bid unless you know them or have a guarantee of their work. Especially with things like cleanup after flooding. If not done properly, you can have mold damage in years to follow.
These tips, along with standard budgeting tips will help you recoup faster from a disaster you couldn't foresee. Download your free home disaster planning eBook
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