Hire accounting support for a business-interruption insurance claim

Give the prospective accountant the event chronology, available financial records and the insurance documents your advisers identify as relevant. Ask which part of the claim it will handle. Calculating a financial loss, interpreting coverage and negotiating with an insurer can involve different professional roles and authorizations.

NAIC explains that business-interruption coverage depends on policy wording and covered circumstances. Have the appropriate insurance or legal adviser establish the assumptions the accountant should use. A financial schedule showing lost income does not, by itself, establish that the insurer must reimburse that amount.

Ask the accountant to identify the historical periods, affected operations and data needed to estimate the impact. Distinguish the disruption period from later recovery and unrelated business changes. Give the specialist evidence of normal seasonality and planned activity without presenting management expectations as guaranteed results.

Specify who reconstructs unavailable records and how estimated inputs will be labeled. The engagement should preserve differences between actual results, supported assumptions and unverified projections. Ask for sensitivity analysis where an uncertain input materially changes the claim, suited to the policy and assignment.

Request schedules that connect the calculation to financial statements, transaction records and approved assumptions. Ask the accountant to explain adjustments, saved costs, additional expenses and other elements relevant to the actual claim methodology. Avoid a single total unsupported by a reproducible calculation.

Agree how the provider records evidence received after the first submission. A later invoice, corrected operating report or insurer question may require an update. The company should retain the original and revised versions with the reason for the change, so different claim participants do not rely on conflicting totals.

Where the assignment is an investigation or litigation-related engagement, ask the accountant which professional standards govern it. AICPA's forensic standards address covered practitioners in those contexts. The applicable service and standards should be identified by the professional rather than inferred from the title claims accountant.

Identify who submits the calculation, answers factual questions and negotiates any disputed issue. Ask whether the accountant's fee includes meetings with the adjuster, written responses and revisions. Keep legal conclusions and settlement authority with appropriately authorized people.

Clarify whether the policy may reimburse professional preparation costs and have the relevant adviser confirm the actual terms. Do not hire on an assumption that the insurer will pay the accountant's bill. Review the fee basis, staged approvals and consequences if the claim is declined or the company stops pursuing it.

At delivery, walk through the calculation and its limitations with management and the responsible insurance adviser. Confirm the evidence supporting material inputs and the questions still open. A supported estimate can differ from the company's initial expectation without indicating poor work.

Identify any accountant separately appointed by the insurer and clarify how information requests will be coordinated. The company’s adviser and the insurer’s adviser may have different instructions, so management should understand which professional is responsible for explaining its own calculation.

Retain the final submitted schedules, source index, approvals and correspondence within the agreed scope. Ask what future support requires a new engagement. The company should be able to explain the financial claim after the specialist leaves, while recognizing that coverage and settlement remain separate determinations.