Common Mistakes Irish Business Owners Make When Filing a Business Interruption Claim

By Jim Flannery ACII, Brand Ambassador, OMC Claims. Over 40 years in insurance claims and a founding member of the Irish Claims Consultants Association.

A sudden disruption to your business, from fire, flood, theft or structural failure, is overwhelming enough. Yet the real challenge often begins afterwards, when it is time to prepare the business interruption insurance claim. For Irish business owners this process is full of traps that delay payouts, reduce settlements or sink the claim entirely.

Whether you are a small retailer, a hospitality business, a large scale industrial operation or service business, the traps are the same, and knowing what not to do is just as important as understanding the process. These are the six mistakes we see most often, why each happens, why it matters, and the practical way to avoid it.

Mistake 1: Delaying notification to your insurer

Why it happens: in the middle of a crisis, ringing the insurer rarely feels urgent. Many owners wait until they have assessed the damage or resumed operations, but most policies require immediate notification, typically within 24 to 48 hours.

Why it matters: a late report can amount to a technical breach of your policy terms, giving the insurer grounds to delay or reduce the settlement, or reject the claim entirely. Read your policy for the claim notification terms or ask your broker.

Best practice: contact your insurer or broker as soon as possible, even without full documentation. Log the date and time of the call and follow up in writing for confirmation. Early communication preserves your entitlement and gives the insurer fewer reasons to dispute the claim. If you are unsure how to describe the incident, keep the first report factual and brief: what happened, when, and the immediate effect on trading. The detail can follow once the picture is clearer.

Mistake 2: Not understanding what your policy actually covers

Why it happens: policies are detailed contracts and full of legal language, and many owners assume all interruptions are covered. In fact, most policies specify certain perils only, such as fire, storm, theft or water damage, and exclusions such as pandemic events or gradual damage frequently apply.

Why it matters: if your interruption does not fall within the covered events, the claim can be denied even where the financial impact is plain.

Best practice: read the business interruption section of the policy thoroughly, paying close attention to the covered events, the indemnity period, any extensions such as denial of access or utility failure, and the documentation requirements. Your insurance broker should be able to advise on the best way to calculate your sums insured and indemnity period. If in doubt, have a regulated loss assessor interpret the cover in plain English. Assumptions cost money; a clear understanding of the policy lets you file a claim that matches your actual cover. The key clauses are explained in our complete guide to business interruption claims.

Mistake 3: Failing to keep detailed financial records

Why it happens: busy owners rely on summary accounts or estimates when calculating losses. Insurers require granular, documented proof of loss, not ballpark figures or projections.

Why it matters: without detailed sales data, payroll records and supplier invoices, it is very hard to prove how much income was lost or which expenses continued through the disruption. Unproven losses do not get paid.

Best practice: gather weekly and monthly sales reports and management accounts from before and after the interruption, invoices and order cancellations, bank statements, payroll data, utility bills and rent or mortgage statements, and staff rosters. A well-documented financial loss is the backbone of the claim, and the stronger the paper trail, the stronger your negotiating position. If your book-keeping is thin, start improving it now rather than at claim time: consistent weekly records built up before an incident carry far more weight with an insurer than figures reconstructed after one.

Mistake 4: Ignoring secondary and indirect losses

Why it happens: owners naturally focus on the immediate losses, property damage and downtime, and overlook the ripple effects: lost bookings, reputational harm, customers who move to competitors.

Why it matters: these losses are often claimable, but only if they are tracked and documented. Failing to claim for them leaves money on the table.

Best practice: track cancelled events and bookings, delayed product launches or projects, supplier disruptions, customer complaints and churn, and wasted marketing spend. Business interruption is not always visible. Document the broader impact so the claim reflects what you truly lost, not just what is obvious.

Mistake 5: Cleaning up or repairing before documentation

Why it happens: the instinct is to get back to business as fast as possible, so cleaning, disposal of damaged goods, or repairing and replacing often start before anyone takes a photograph.

Why it matters: your insurer, and your loss assessor, need to see the damage before it is repaired. Without photographic evidence, proving the scale of the loss becomes far harder, especially for anything no longer visible.

Best practice: before making any repairs, take wide-angle and close-up photographs, record video walkthroughs, save damaged items on-site where possible, and log every action with dates. Reasonable steps to prevent further loss are fine and expected; permanent repairs come after documentation, not before.

Mistake 6: Accepting the first offer

Why it happens: many owners assume the insurer’s first offer is final, or are simply too stretched to dispute it. Insurers are inclined to suspect that all claims are exaggerated and may seek to minimise payouts. The first offer frequently undervalues the full impact, particularly the interruption element where the figures are open to argument.

Why it matters: accepting a low offer can prevent you recovering the full financial loss, and once accepted, settlements are rarely reopened.

Best practice: review the offer carefully against your own calculation of lost gross profit, continuing costs and the trends adjustment. If the payout looks low or incomplete, consult a loss assessor to value the claim independently and challenge the settlement offer. Your business is entitled to a fair settlement, and you have every right to seek a second opinion before signing.

Avoiding mistakes is half the battle

Filing a business interruption claim is not something most Irish business owners do more than once (if ever), and getting it wrong is expensive. Prompt notification, a clear read of the policy, thorough financial records, documented indirect losses, evidence before repairs, and a properly tested settlement offer: do those six things and you have removed most of the reasons these claims underpay.

If the claim is complex or high-value, or a mistake has already been made, professional representation puts it back on a proper footing. A good insurance broker can help you to understand the process. A regulated loss assessor manages the process and argues the case, so missteps and misunderstandings do not decide the outcome.

One final point on timing. Every one of these mistakes is easier to prevent than to repair, and the window for preventing them is the first day or two after the event. Notification, records, photographs and the policy review all belong in that window. Get those right and the negotiation months later starts from strength rather than apology.

Frequently asked questions

What triggers a valid business interruption insurance claim?
A covered event that directly interrupts your ability to trade, such as fire, flooding, storm damage, theft or structural failure, causing lost or reduced income or increased costs as a direct result. Always check the policy wording for the exact insured perils.

How long do I have to notify my insurer after a business interruption event?
Some policies expect notification within 24 to 48 hours. Delay can breach policy terms and give the insurer grounds to reject or reduce the claim, so make the initial report promptly even before full documentation is ready. Talk to your broker or insurer as soon as possible.

What is an indemnity period in a business interruption policy?
The maximum length of time the insurer will cover lost income and continuing expenses, commonly from 12 up to 24 months or longer. It starts at the interruption and runs until the business is reasonably back to normal trading, within that limit.

Can I claim if my business was not physically damaged but had to close?
Yes, if your policy includes denial of access or utility failure extensions, which respond where nearby danger or a power, water or telecoms outage forces closure. These are not standard on all policies, so review your cover.

What documentation do I need to support a business interruption claim?
Pre- and post-event sales reports, bank statements and invoices, payroll records and utility bills, booking cancellations or lost orders, and photographs or video of any property damage. Analysing the management accounts for 24 months prior to the incident will establish any seasonal or annual growth trends in the business. The stronger the paper trail, the easier the loss is to prove.

Should I hire a loss assessor for a business interruption claim?
For large or complex claims it is strongly worth considering. A regulated loss assessor works for you rather than the insurer, documents the losses, prepares the claim and negotiates for a fair settlement so nothing is overlooked.

If a mistake has already been made, it is rarely fatal, but the sooner the claim is put back on a proper footing the better. OMC Claims acts only for policyholders, across all 26 counties. Contact us for a free, no-obligation review of your claim.

About OMC Claims

OMC Claims (Owens McCarthy Ltd) is Ireland’s largest independent firm of loss assessors, acting only for policyholders, never for insurers. We provide nationwide coverage, with loss assessors serving Dublin, Cork, Limerick and every other county in Ireland. Part of the Fexco group and regulated by the Central Bank of Ireland (Registration Number C-46734), our team brings over 250 years of combined claims experience and handles more than 2,000 home and business claims a year, from straightforward domestic losses to large and complex commercial claims. We assess the damage, prepare and value your claim, and negotiate with your insurer to work to secure the settlement you are entitled to.

Disclaimer: This content is for general informational purposes only and aims to provide an overview of common mistakes in business interruption claims. It does not constitute legal, financial, or insurance advice. For guidance tailored to your specific circumstances, please consult a claims professional or your insurance broker/provider.