ASA Stands with our members in Texas and New Mexico Impacted by the devastating flooding

Navigating Post-Disaster Recovery: Essential Resources for Subcontractors

The recent Severe weather in Texas and New Mexico has impacted many in our community. The American Subcontractors Association (ASA) stands firmly with our members and all of those in the affected regions, recognizing the multifaceted challenges they face. The Foundation of the American Subcontractors Association (FASA) is dedicated to ensuring ASA members as well as the entire construction industry have the resources needed to navigate a natural disaster, from immediate response to long-term recovery.

Federal Resources: Aiding Recovery Efforts

When disaster strikes, federal assistance can be a critical lifeline. This aid is typically activated after states and tribal governments petition the President for an emergency or major disaster declaration. The specific programs authorized depend on the needs identified during joint damage assessments.

• Federal Emergency Management Agency (FEMA): FEMA coordinates the federal government's pivotal role in disaster preparation and relief. Following an emergency declaration, FEMA may offer federal grants for:
  • Individual Assistance: Programs like the Individuals and Households Program for temporary housing, emergency home repairs, loss of personal property, crisis counseling, disaster case management, unemployment assistance, legal services, and supplemental nutrition.
  • Public Assistance: Support for State, Tribal, and local governments, as well as certain private nonprofit organizations, covering emergency work, debris removal, and the repair or replacement of disaster-damaged facilities such as roads, bridges, utilities, and public buildings.
  • Hazard Mitigation Assistance: Funding for actions taken to prevent or reduce long-term risks from natural hazards.
  • To understand the declaration process, see FEMA’s How a Disaster Gets Declared Site. Check the Disaster Assistance Improvement Program site for current disasters and resources.
• Small Business Administration (SBA): The SBA provides crucial low-interest disaster loans to help businesses and homeowners recover from declared disasters.
  • Physical Damage Loans: Cover repairs and replacement of physical assets.
  • Mitigation Assistance: Provides funding for small business operating expenses following a disaster.
  • Economic Injury Disaster Loans: Offer economic relief to small businesses and non-profits that have suffered economic injury.
  • For in-person assistance, visit an SBA Disaster Recovery Center, or find more information at sba.gov/disaster or by calling (800) 659-2955.
• Additional Recovery and Resilience Resources:
  • Small Business Development Centers (SBDC): Offer no-cost, one-on-one business advising to help entrepreneurs navigate post-disaster challenges.
  • SBA Community Navigators Program: A partnership with local organizations to help minority-owned and disadvantaged small businesses access SBA resources.
  • SCORE: Provides Small Business Resilience Training to help businesses adapt, reopen, and grow successfully through any disaster.
  • Fraud Protection: FEMA offers dedicated resource pages on Scams and Disaster Recovery Rumors to help protect you and your business.
  • Federal Contract Work: Businesses willing to provide disaster relief supplies or services can register in the Federal Disaster Response Registry via the System for Award Management (SAM).

Insurance Coverage and Claims: Navigating the Process

Effectively managing your insurance claims immediately after a disaster is paramount. Proactive steps and a clear understanding of your policies can significantly impact your recovery:

• Initiate Contact Promptly: Call your insurance company and adjusters as soon as possible. Identify all policies that may be in effect and be aware of deadlines for filing claims. Send any required notices promptly and request copies of owner and subcontractor's notices.
• Exercise Caution with Service Providers: In the aftermath of a disaster, it's common for contractors to come from out of state. However, not all are reputable or experienced with the insurance claims process. Whenever possible, seek guidance from your agent and/or carrier, and prioritize working with properly-vetted companies. Similarly, think carefully before contracting with a public adjuster; their agreements can often limit your rights regarding carrier payments and may not always align with your best interests.
• Thoroughly Document Your Loss: This step is crucial for a successful claim. Generate specific lists detailing the purchase price, date, and any other relevant information for damaged items. Photos are highly beneficial, and apps like the NAIC's Home Inventory can assist with detailed documentation. A video walkthrough of damaged areas is also strongly recommended. If possible, consider delaying some immediate repairs until your insurance provider has reviewed the losses.
• Understand Claim Settlement Timelines: Confirm how long your insurance company has before they are required to offer a claim settlement.
• Beware of Potential Surprises:
  • "Actual Cash Value" vs. "Replacement Cost Value": Know the difference. "Actual cash value" factors in depreciation, potentially resulting in a lower payout, while "replacement cost value" covers the cost of replacing an identical piece of property.
  • Business Income Loss: Be aware that coverage on business income loss can be impacted by determinants such as the "period of restoration" date and whether the loss stems from direct physical damage versus depressed business conditions.
  • Deductibles and Co-insurance Clauses: These elements in your policy can directly impact your claim settlement, so review them carefully.
• Review Past Claim Issues: Learn from previous natural disaster insurance claims, noting instances where payouts were significantly below damage estimates, as seen with Hurricane Ian, emphasizing the importance of diligence.

Legal Considerations: Expert Guidance When You Need It

Following a natural disaster, engaging legal counsel can be crucial for navigating complex issues and protecting your interests. Attorneys can provide invaluable assistance with concerns related to:

• Environmental Issues: Addressing potential ground contaminants and relevant regulatory compliance stemming from the damage site.
• Contractual Issues: Expert guidance on delays, additional costs, and compensation disputes arising from contractual agreements.
• Insurance Company and Coverage Claims: Assistance in engaging with insurance companies and managing coverage claims to ensure fair treatment and adherence to policy terms.

Support from ASA Attorneys’ Council: For ASA members seeking specialized legal expertise, the ASA Attorneys’ Council is a valuable resource. This national network of dedicated construction law attorneys is actively engaged on issues relevant to the Association. If you would like a listing of Council attorneys in your area, please contact Shannon Oscar at soscar@asa-hq.com.

Additional Resources for Legal Assistance:

• Disaster Legal Services
• American Bar Association
• Legal Aid Disaster Relief Center