Commercial Claims

When insuring commercial property on a basic or broad form, the property covered must be insured for at least 80% of the replacement cost and at least 90% on the special form. Not having the proper co-insurance on the insured property will result in the claim payment being reduced by the % of the shortage.

Most Business Owners Policies have a sublimit on outdoor signs of about $2500. If the business owner has a free standing sign on a pole, these signs can be much more than $2500. Make sure your agent endorses your policy to accommodate the replacement cost of the sign.

If the business is forced to close while under repair for a covered peril such as fire or windstorm, a claim can be filed for loss of income during this period. Most policies have a monthly limit, time limit and policy limit for this coverage. The business owner should be prepared to prove the amount of lost income to the claims adjuster.

Food retailers should carry this coverage to pay for food spoilage in the event of a long power outage that usually occurs after a hurricane or tornado. Spoilage coverage is not the same as inventory coverage.

This is a very important coverage to have on the commercial policy. Many leases today offered by property management companies will include in the lease that the lessee is responsible for repairing and replacing equipment such as HVAC units and boilers. This coverage will respond to a claim in the event of a covered peril.