The insurance industry and policy-holders have often under-valued the cost of repairing and rebuilding commercial property and structures. The property insurance market has become distressed over the past few years due to the combination of valuation problems, construction inflation, and increased weather-related losses. That has driven insurance companies to ask more thorough underwriting questions, use new technology, and push clients to increase their property values. What does this mean to you?
Insurance companies will be inquiring about the age of your building, the age, and condition of your roof, mechanical, electrical, and plumbing systems. We are seeing new questions, such as asking for your “written maintenance plan.” For older buildings, they will be very particular. We love working with clients who preserve and re-purpose older buildings. It is good for the community and it aligns with our values. We must advise you, though, that we will be asking you more and more questions. It is to help us secure quality coverage with good insurance companies.
Insurance companies use the internet, GIS systems, maps, artificial intelligence, and drones to gather information about properties. They still send inspectors out as well. We have experienced some surprises and miscommunications because they gathered information without informing us in advance. We will always make you aware when we know that they are inspecting your property, but please know that they may be collecting this information without you or us knowing.
Finally, you should adequately insure your buildings, contents, and business income. The cost to rebuild has increased significantly over the past few years. Even with some building material prices evening out, labor costs have and should continue to increase. We can help you estimate the cost to rebuild your building(s), and often, we are asked to do so by the carrier. We must rely on you to determine the cost of replacing your contents, machinery, and equipment. We also recommend that you complete a business income worksheet annually.
We are eager to help you get the best value in the insurance market. Please let us know how we can help you with your maintenance plan and protect your assets properly.