A wave of natural disasters--including Hurricane Ida, flash floods in Tennessee and New York, and wildfires in California--have wreaked havoc on millions of small businesses in recent weeks. Many companies that were already struggling to stay afloat amid the pandemic now have to deal with power outages, interruptions to water and internet service, and most distressingly, displaced staff and customers. And that's even before turning attention to costly longer-term issues like property damage and supply chain interruptions.
Fortunately if your small business has been hit hard by a natural disaster, there are options for relief. Here are some steps you can take.
Apply for emergency SBA disaster loans
Small businesses affected by natural disasters can file insurance claims and apply for emergency disaster relief loans from the U.S. Small Business Administration. On September 2, SBA opened up low-interest federal disaster loans to a select number of parishes and counties in Louisiana, Tennessee, Oklahoma, New York, California, and Florida. If your county is not on the list, be sure to regularly check back on the SBA website for updates. In order to be considered for an SBA loan, you need to apply at FEMA's disaster assistance website. Be aware that due to the large volume of applicants, there are likely to be delays.
Even if you have insurance for your business, you can apply for an SBA disaster loan for damage not covered by your policy. (Many commercial insurance polices don't cover damage from earthquakes or floods, for example.) But you'll have to file your insurance claim first before applying. By law, FEMA can't provide compensation for any losses that have already been covered by an existing insurance plan. So be sure to file with your insurer as soon as possible to avoid delays in receiving your loan.
If more than 30 days have passed since you've filed your claim with your insurance company and you still haven't heard any word, you can go ahead and apply for an SBA disaster loan. But you will need to explain the circumstances and provide proof of the insurance claim, according to FEMA's site.
Both businesses and private nonprofit organizations qualify for SBA disaster relief loans. The maximum loan amount is $2 million. Funds can be used to repair or replace damaged or destroyed real estate, machinery and equipment, inventory, and other business assets. If you're looking to disaster-proof your business, SBA can also lend additional funds for that purpose.
Join a mutual aid network
If you haven't joined a mutual aid network yet, now is the perfect time to do so. These groups are made of volunteers and local organizations and can provide funds, food, volunteers, and other resources to businesses in need. In order to find a mutual aid network in your community, check the Mutual Aid Hub.
Apply for local and state assistance
Additional resources for small businesses may be available from your state or city government. Here is a list of agencies with resources for small businesses in disaster-affected states:
Keep an eye out for deals from corporations
Many companies offer free or discounted services to small businesses impacted by natural disasters. For example U-Haul, the moving and storage company, offers 30 days of free storage to companies that have been damaged by floods, earthquakes, or fires.