Be Aware of These Notable Commercial Property Coverage Gaps

When it comes down to commercial property coverage gaps, you should always keep an open mind: there’s more than one thing that could affect your overall insurance coverage. Local building ordinances often change over time, meaning that those with longstanding businesses have to keep track of those changes. If your commercial property building needs rebuilding, keep in mind these notable commercial property coverage gaps, courtesy of a study done by International Risk Management Institute (IRMI).

Key Coverage Gaps

  • Make Sure You Have the Funds You Need – Failure to purchase sufficient limits of insurance can lead to problems down the road. If you use the accounting book value as the insurable value for your property, it can come back to haunt you later. Other problems include if you rely heavily on property value estimates from software programs, which can sometimes have errors because they have minimal information about the property.
  • Actual Cash Value and Replacement Costs Are Not the Same – It’s not good to use less than optimal valuation provisions. Since building ordinances change over time, it’s important to keep track of things by their replacement cost, not the actual value.
  • Ordinance or Law Coverage is Crucial – Failure to get coverage can result in you footing the bill for your business later. Other forms of coverage that should be purchased include earthquake and flood coverage.
  • Don’t Insure One Location, Insure Them All – If you have more than one location, then you need coverage for multiple locations. One insurance policy won’t cover it. Failure to get insurance for multiple properties can definitely slow you down in the long run.
  • If Equipment Breaks, Fix it – If something breaks, it needs to be fixed. If vital equipment breaks down, it’s your job to make sure that it gets fixed in a time frame where your income won’t be affected. That’s why it’s important to have coverage to back you up when machinery goes out.
  • Borrowed Equipment Gets Coverage too – Another big property coverage gap comes with borrowing equipment. Even if it’s being rented or borrowed, it still has to have some sort of coverage.

It’s important to be aware of some of these commercial property coverage gaps. When purchasing property coverage insurance, always keep in mind exactly what needs to be covered. With H&A, you’re in good hands.

About Haughn & Associates

Founded by Michael Haughn in 1986, Haughn & Associates is a full-service, family-owned, independent insurance agency based out of Dublin, Ohio. H&A strives to provide the best possible price and unique insurance solutions across a myriad of industries, including construction, IT, Habitation & Commercial Property, Agriculture, and Engineering. Devoted to providing the best of business insurance, life and disability insurance, personal insurance, employee benefits, and bonds, H&A is proof that success lies in long-standing client relations and satisfaction. To learn more about how H&A can be of service to you, contact us at (877) 802-2278.