As a business owner, what does the coming new year mean to you? Hope for the future? Excitement of things to come? The renewal of your commercial property insurance policy?
While it may not be the most exciting answer, the truth is that many businesses link the renewal of their commercial insurance policies with the calendar year. So in the spirit of New Year’s resolutions, add this one to your list: adequate commercial property insurance limits.
Here are three tips to make this resolution a reality:
1) Review the limits on your commercial property insurance policy’s schedule/declarations page—specifically, any limit shown for your buildings, business personal property and business income insurance. Instead of renewing your policies “as-is,” schedule a review with your insurance agent to discuss any needed changes. For example, instead of scheduling limits separately, would it be possible to have all of your property insured with one “blanket” limit? Your agent will help you understand this method of insuring property and see if it’s an option for your business.
2) While reviewing your policies with your agent, ask about “sub-limits” included throughout the policy. For example, your policy may cover damage to outside signs but only up to a sub-limit of $2,500. Do any of your policy’s sub-limits need to be reviewed or modified? If so, your agent can help.
3) Understand the risk of underinsurance. Not having enough insurance at the time of damage could result in an underinsurance penalty (often called “co-insurance”) being applied to your claim payment.
