Preparing for the true extent of power surge damage

What do lightning strikes mean if you are a business owner? Power surges.

Flowers

By Megan Scarano
Commercial Lines Account Executive

According to National Geographic, about 100 lightning strikes hit the Earth's surface every single second. Each bolt contains up to one billion, yes billion, volts of electricity! And I'm sure this won't come as a surprise, but lightning is hot. In fact, lightning can make the air around it five times hotter than the sun's surface.

So what do lightning strikes mean if you are a business owner? Power surges. 

Power surges are the enemy of any and all things electronic.  Important things like computers, cash registers, security systems, and inventory control systems, communication equipment, phones, refrigeration equipment, elevators and heating/cooling systems.

As far as weather related power surges go, the month of June has the highest number of outages, followed by July and August. And, the number of power surges doubles every five years on average. 

Power surges can severely damage property. And they can affect your business's ability to stay open, operate and bring in customers.

For example, I once worked with a large florist in the Mid-Atlantic region that had a power surge damage refrigeration systems. The florist had to close while repairs were made. On top of losing their beautiful fresh flowers, some of which were rare and needed to be kept at a certain temperature, the florist lost income while it was unable to operate. All in all, damage to the florist's equipment, loss of income, and damage to inventory amounted to over $54,000.

It's examples like this one that should make the words "equipment breakdown coverage" very important to all business owners, especially flower shops. General business insurance policy for property may not automatically include protection for electronic equipment. This is a key topic to talk about with your independent insurance agent.   
If you've already had a power surge from lightning strike damage equipment at your place of business, you might think you're safe. After all, shouldn't the old adage "lightning never strikes twice in the same place" apply? Unfortunately, like many old sayings, that's far from the truth. Lightning can strike twice in the same place, and often does. And, power outages aren't always caused by spectacular weather events. They can be caused by brownouts on hot summer days or by simply switching on a large piece of equipment, such as a refrigeration system.   

Damage to equipment is bad enough, but think beyond the property damage alone. Think about what the loss of the ability to use that equipment would mean for your business. Start there when you talk to your insurance agent. 

This publication is designed to provide general information regarding the subject matter covered State Auto Insurance makes no representations or guarantee as to the correctness or sufficiency of any information contained herein, nor guarantees of results based upon use of this information. State Auto does not warrant that reliance upon this document will prevent accident and losses or satisfy federal, state and local codes, ordinances and regulations. The reader assumes entire risk as to use of this information.