Even if you’re lucky enough to have avoided devastation, you should still research disaster assistance options. By being prepared prior to an emergency, you can better protect your business's financial future. In this post, we’ve compiled five tips for small businesses pursuing disaster relief. Whether your business has already experienced the devastation of hurricanes, or you simply want to be prepared for the future, these tips will benefit you.
How to Pursue Disaster Relief Options for Small Business Owners
1. Research SBA Disaster LoansHurricane relief for businesses is provided by the federal government through many avenues. However, the Small Business Administration (SBA) disaster loans are the most relevant to small business owners. Usage: The SBA offers loan amounts to business owners coping from losses caused by natural disasters that aren’t fully covered by insurance. If you apply for the SBA disaster loan program, you could receive up to $2 million for the following expenses:
- Damaged or destroyed real estate
How the SBA Has Helped Small Businesses:The SBA offers financing solutions for businesses trying to survive tough times. Here are some of the ways they’ve been able to help business owners after large storms.
- After Hurricane Katrina, Rita, and Wilma, the SBA approved $10.9 billion in disaster loans for small businesses.
- The SBA loaned out $2.5 billion for disaster recovery after Hurricane Sandy. The approval rate for loans after Katrina, Rita and Wilma was 45 percent. And for Sandy, the approval rate was 53 percent.
- In 2018, Hurricane Florence affected businesses throughout North Carolina and South Carolina. Less than 7 weeks after the storm, the SBA provided more than 7,000 disaster loans.
2. Explore Economic Injury Disaster Loans (EIDL)In some cases, your business may qualify for the SBA's EIDL program. To qualify for this program, you must be able to prove that:
- You own a small business, agriculture cooperative, or non-profit organization
- Your business has suffered significant economic injury and is in a declared disaster area
- You require financial assistance to afford operating expenses