Entrepreneur in the mall: 'We are damaged in the rain, in the fire'

Amidst a deluge of heavy rain in the past few days, the recurring inundation of the "Bina" and "Sadarak" shopping centers in the bustling city of Baku has once again raised concerns about the vulnerability of these commercial hubs. Business owners are bemoaning a frustrating cycle wherein each instance of flooding or fire wreaks havoc on their establishments, leading to substantial losses. Distressingly, their claims of being denied insurance coverage in the aftermath of these incidents have only compounded their woes.

Entrepreneurs have voiced their distress over insurance companies consistently declining coverage for their goods. In a perplexing twist, these businesses allege that the refusal stems from a deemed lack of compliance on the part of the shopping centers themselves. According to their accounts, insurers have pointed to inadequacies in the safety systems of these shopping centers, rendering them ineligible for coverage.

Anonymous testimony from an owner within the beleaguered Sadarak Shopping Center highlighted the extent of recent damage: "This time, the toll has been significant. Some have suffered losses of around $8,000, while others have been hit with staggering losses of $15,000 to $20,000."

Entrepreneurs told Turan about their persistent attempts to enlist insurance protection, only to be rebuffed with the explanation that the shopping centers fail to meet the stipulated safety standards. Reportedly, this inability to comply with necessary safeguards casts a shadow over their chances of obtaining coverage. Their outcry underscores a prevailing dilemma: countless valuable goods remain uninsured, leaving businesses acutely exposed to the capriciousness of weather and misfortune.

In response to the recent flooding, the management of the Sadarak Shopping Center acknowledged the lack of pump power as a pivotal factor in the water intrusion. They vowed to implement stringent measures in preparation for the forthcoming autumn and winter seasons to avert a recurrence of such distressing events. The notion of preparation is closely linked to insurance, as the shopping center's representatives emphasized that entrepreneurs bear the onus of safeguarding their assets through proper insurance channels.

The elusive management of the "Bina" Shopping Center remained inaccessible for comment, casting a shroud of mystery over their stance on the matter.

The Association of Insurers of Azerbaijan (ASA) echoed a mixed sentiment, outlining a bifurcated approach based on insurance coverage. Owners of insured properties that suffered damage can anticipate compensation, while those without insurance are left to grapple with the financial repercussions independently. ASA underscored the pivotal role of real estate insurance as not only a legal obligation but also a safeguard that bolsters the socio-economic fabric of the region.

According to the ASA, the determination of insurance premiums for non-residential properties hinges on multiple factors, encompassing location, purpose, and scale. The agency also emphasized that adherence to safety regulations is a prerequisite for insurance coverage. This critical point was further expounded upon by legal expert Akram Hasanov, who highlighted the precarious position of several large-scale trading establishments within Azerbaijan. Hasanov in an interview with Radio Azadlig shed light on a disconcerting reality: some commercial entities lack proper documentation pertaining to ownership or usage rights. In a perplexing twist, insurers are deterred by this lack of legal standing, effectively rendering the properties uninsurable.

Hasanov identified a potential avenue for resolution by urging relevant authorities to confront the shadow economy head-on. He contends that addressing these issues could potentially alleviate the plight of business owners and provide a more stable foundation for economic growth.

Efforts to glean insights from the State Tax Service under the Ministry of Economy, a crucial regulatory body, proved unfruitful. This silence underscores the complexity and urgency of the situation, leaving affected entrepreneurs and analysts alike grappling with questions about the viability of the existing regulatory framework and the safeguards in place for the local business landscape.