Ever thought about debris removal costs?

An often overlooked, but important, part of the property coverage in every business insurance policy is coverage devoted to debris removal. Most business owners, and insurance agents for that matter, tend to take this part for granted, without giving any real thought to the coverage and it's potential importance should a claim occur requiring it's implementation. If a major property loss occurs, there often tends to be a large amount of debris. The more debris from the loss, the cost to remove it increases. This doesn't take into account costs associated with types of debris removal. If the insured is in an old building, there may be hazardous material that needs to be removed, possibly asbestos, which would further drive up the cost of removal. It's important to remember that in most policy forms the coverage limit for debris removal is part of, not in addition to, the overall limit for covered property. If you don't take this into consideration when setting up coverage you may find yourself with insufficient limits in the event of a major loss. Consider the cost of debris removal when establishing your limits at the beginning. Some factors to take into consideration are age of the building, proximity to other buildings, type of structure and materials used in it's construction, and possible existence of any hazardous materials. There isn't a one size fits all approach to this, but one possibility is to ask a local contractor to provide an estimate, assuming a total loss. This value can then be increased or decreased each year like other insured values.

Comments

Post a Comment

Popular posts from this blog

Delaware Legislature Preparing To Revisit Dram Shop Liability

Here we go again. Representative Peterson is preparing to introduce limited dram shop liability for consideration. The legislation caps the liability at $250,000 but, as is usually the case, this creates a starting point where limits are eventually increased once it's decided by the powers that be that the current limit is too low. This also puts restaurants, bars, etc, at an increased risk due to the vague wording of the legislation, specifically "reckless" sale of alcohol by the business. Also, you can be sure that if this legislation is passed, that rates will go up commensurately for not only Liquor Liability coverage, but if actual damages begin to be paid out under this law, that insurance rates on the whole will see an increase.
Read more

Get employees back to work quickly to keep work comp costs down

Image
In the past I have spoken to clients regarding a particular workers compensation claim affecting them and have asked if they have brought the employee back to work yet. Too many times the answer is no, they have nothing for that employee to do since said employee is not 100% and unable to perform their specific job prior to their workers compensation injury/claim. The problem with this is that too often employers miss the point that even though an employee can't perform in the position they were in prior to their injury, it behooves the employer to create some type of alternative task/job the employee can do until such time they are able to resume their normal duties. Bringing that employee back to work means that work comp benefits /payments in that particular claim are being curtailed, thereby saving the employer potentially more being paid out, while adding to their experience mod and driving their overall work comp expenses up.
Read more

Important to notify insurance company of potential liability claims

Image
When trying to manage their insurance policies, many business owners make the decision not to turn in potential claims and decide to take care of them on their own. By paying for small claims, such as property damage, etc, they strive to keep claim frequency down and in turn keep renewal premiums down. One area of insurance they should not try to manage though is potential liability situations/claims. Most policy conditions require prompt notification of any potential liability claims to the insurance company and if a claim isn't turned in promptly, the policy language does note that the company can deny a claim due to late notification. It's important to do this early on since information/memories are still fresh and it gives the insurance company time to completely investigate the potential claim. The potential for a liability claim is most likely the small business owner's greatest area of risk, whether they operate a restaurant, cleaning service or any other busi
Read more