Natural disasters continue to hit business owners squarely in their bank accounts, and 2021 was one of the costliest years yet, according to new data from the Federal Reserve.
Most of those losses were not covered by insurance or other programs. Just 18% of businesses relied on insurance to recover losses, compared to 12% using debt or loans, and 11% using federal disaster relief loans. About 56% did not rely on external funds, according to the study. Only 15% of firms impacted by Harvey received a payment from insurance. About 27% of firms used credit to finance their recovery. And of those that applied for disaster loans from the SBA, just one-third were approved. About 48% said they had not fully recovered one year later.
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