When a commercial insurance claim is first “resolved” by the insurer, the offer can feel like a relief. Cash flow pressure, business disruption, and uncertainty often make any money seem better than none. Insurers know this. That’s why first offers on commercial claims are rarely designed to fully compensate the loss.

In most cases, the initial offer is not a final valuation—it is a starting position. Understanding what that offer includes, what it leaves out, and what rights you give up by accepting it is critical before you agree to anything.

The Short Answer: Usually No

You are almost never required to accept the insurer’s first offer on a commercial claim. That offer is typically based on:

Preliminary estimates
Incomplete information
Conservative interpretations of coverage

Once accepted, however, it may permanently limit your ability to recover additional amounts.

Why First Offers on Commercial Claims Are Often Low

Commercial claims are complex and high-value. Insurers manage risk by controlling payouts early.

Common reasons first offers fall short include:

Incomplete scopes of repair or replacement
Business interruption losses that haven’t fully materialized
Extra expenses excluded or capped prematurely
Depreciation or valuation assumptions applied too aggressively

The true cost of a commercial loss often isn’t known at the outset.

What a First Offer Usually Does Not Include

Initial offers often exclude or undervalue:

Full business interruption losses
Extended shutdown impacts
Extra expense incurred to mitigate loss
Code upgrade or bylaw costs
Market-driven rebuild cost increases

Accepting early can lock in assumptions that later prove wrong.

The Risk of Early Releases and “Final” Settlements

Commercial insurers frequently condition payment on:

Full and final releases
Settlement of all present and future losses
Waiver of additional claims

Once signed, these documents are difficult—sometimes impossible—to undo.

When Accepting an Early Offer Might Make Sense

In limited situations, early resolution may be appropriate:

The loss is minor and fully documented
All categories of damage are clearly accounted for
Business operations are fully restored
No release is required, or it is narrowly drafted

Even then, careful review is essential.

How to Evaluate a Commercial Insurance Offer

Before accepting any offer, ask:

Does this include all coverage categories?
Are business interruption and extra expenses complete?
Are assumptions about timelines realistic?
Is depreciation or valuation reasonable?
Am I being asked to sign a release?

If the answer to any of these is unclear, the offer is not ready to be accepted.

Why Legal Review Matters in Commercial Claims

Commercial claims are not just accounting exercises—they are contractual disputes.

A dedicated Alberta insurance lawyer can:

Analyze coverage categories and limits
Identify what the offer excludes
Preserve your right to claim additional losses
Push back against premature settlement pressure
Negotiate without jeopardizing cash flow

Insurers often increase offers once they know a claim is being reviewed seriously.

The “Home Field” Advantage

Commercial losses in Alberta often involve industry-specific realities—seasonal operations, construction delays, and regulatory requirements. These factors matter when valuing a claim.

At Shiv Ganesh Professional Corporation, we represent policyholders, not insurers. We understand how first offers are structured and how to challenge them without derailing recovery.

Don’t Trade Speed for Value

Accepting a quick settlement can feel like progress—but it often costs far more than it saves.

If you’ve received a first offer on a commercial insurance claim, get advice before accepting it.

Received an early offer on a commercial insurance claim?
Contact commercial insurance lawyer today for a free consultation. We’ll review the offer, explain what it really means, and help you decide whether to accept, negotiate, or push back.