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Are You Covered?
  • Your Building in Winter
    Winter brings the threat of freezing temperatures and harsh conditions to much of the U.S. Some places are well beyond the threat; it’s going to freeze—there’s no way around it. Such conditions pose unique hazards to commercial building owners. Following is some information on common winter threats and how they are addressed by commercial property insurance.
  • D&O Insurance:  Protection from Boardroom Liability
    Many people will celebrate the holiday by giving back to their community. Volunteering time or services to a company or non-profit organization may be a selfless act of generosity, but these acts of goodwill can also expose volunteers to possible lawsuits if they are making decisions on behalf of the organizations or company. Fortunately, there is a way to mitigate the exposure to lawsuits and continue lending a hand.
  • How much building insurance is enough?
    As a small business owner, you know the importance of preserving your assets. For many business owners, the largest single asset they possess is their building. Whether you occupy the building or operate as a landlord (or both), consider key exposures in your risk-management and insurance planning.
  • Don't Get Robbed Twice!
    One of the often confusing attributes of crime insurance coverages is that the terms used in the insurance policies reflect legal definitions, not the meanings we assume in everyday conversation.
  • Insuring Income: The Lifeblood of Your Business
    If someone asks you if your firm has a catastrophe plan, how would you respond? Would your answer sound something like this: “There’s nothing in writing, however, if something happened that compromised our ability to earn we have a good idea what we would do.”
  • Business interruption insurance
    Would you believe that there is an insurance product specifically designed to help insure a solid, sustainable profit? In fact, without this coverage, hitting your profit targets may become impossible.
  • Where medical fits into liability coverage
    There are two extremely valuable provisions in a solid business insurance policy designed specifically to respond to incidents such as this. The goal of the provisions is twofold:  protect your business from the financial risk of such accidents—legal fees for defense, the potential for large lawsuit awards against you; and try to quickly respond to the pain of the victim in ways that help to avoid lawsuits in the first place.

  • Don’t Let the "Gottas" Determine Your Risk
    As the owner of a small business, you understand better than anyone the meaning of “risk.” The key is to know understand how much risk you can afford, and when or where is the right place to take risk.
  • Don’t Let Your Income Slip When You Do
    Chances are you started your small business with long days and longer nights.  You are fully aware of the truth of the old saying:  'When you are self-employed you work for the toughest boss in the world!"
  • Boom: Understanding Discontinued Operations Coverage
    As a homebuilder, you spent your life making sure the work you did was safe and sufficient. Every year you purchased a commercial general liability (CGL) policy just in case. You made it many years with no claims and want to reward your good work with a much deserved and overdue retirement in where else? Florida.
  • Protecting Your In-Home Business
    Today more than 43 million Americans are operating full- or part-time businesses from the comfort of their homes, and these numbers continue to grow every year. One of the secrets to running a successful home-based business is being able to separate your business activity from your home activity.
  • Landlords, Beware
    Experienced landlords will agree that there is nothing quite as comforting as a good tenant; especially if the tenant spends his own money making improvements to your building during the lease term. 
  • Managing Your Mod
    Employers are told by the states in which they do business how to provide adequate workers compensation insurance for employees. As in other forms of insurance, fair pricing is determined using historical loss data. In the workers comp world, this data is assigned to specific job-types; hence a roofer who hasn’t had a claim in 25 years may still pay a very high rate for his coverage.
  • Insuring the Theft of Your Business Data
    The stories of breached data security have become almost too familiar: An employee takes home a laptop against regulations. A hard drive is sent out for repair, but disappears. A disc with sensitive data is stolen from an office. For business owners and managers, the threat is real, and there is a need to protect against such violations of data security.
  • Triple Net Lease Caveats
    In recent years, more and more building owners are becoming fascinated with the concept of the “triple net lease.” A primary reason for the interest is that the terms of such a lease require the tenant of the building purchase and maintain adequate insurance on the building itself. This is in contrast with traditional lease agreements, which generally state that a tenant is responsible for insuring what’s his and the building owner handles the rest.
Landlords, Beware

Experienced landlords will agree that there is nothing quite as comforting as a good tenant; especially if the tenant spends his own money making improvements to your building during the lease term. 

But if a tenant plans to spend big bucks on improving your property, you’ll want to consult your Trusted Choice® insurance professional first. That’s because improvements that become part of the building are calculated into the building owner’s property insurance limit for the purposes of determining adequate insurance. So a building owner must amend his insurance to reflect the value of the improvements or he could be in for an unpleasant surprise at claim time.

Business insurance policies determine how much of a loss is paid by using the value of “covered property” at the time of the loss, not when the policy was purchased. The building insurance limit must at least equal a certain percentage of value, typically 80%, 90%, or 100%.

Consider this example: A landlord leases his retail building to a tenant who sells custom floor coverings. The current value of this building is $2 million and the landlord’s insurance policy has a limit equal to 100% of that amount, as required by his policy. With the landlord’s permission, the tenant installs a new floor in the showroom valued at $1 million. A fire damages part of the building. The showroom and custom flooring are not directly damaged. However, while processing the claim, the insurance adjuster determines that at the time of the fire, the value of the building includes the new floor, thus bringing it to $3 million: $1 million greater than the limit on the landlord’s policy. The landlord is severely underinsured and therefore will not receive the full amount of the loss.

So what if the lease makes the tenant responsible for providing insurance for the betterment? Realty laws in most states say that once an improvement is made to a building it becomes part of the building and is therefore included in that building’s overall value. While it is common for landlords to require that tenants insure the betterment itself, that may not be sufficient. In this example, it was not the damage to the floor that caused his problem, but rather that the value of the new floor increased the overall value of his building and the landlord did not amend his insurance for the spike.

Claim time is no time to discover that you are underinsured. You have already suffered a loss, so the last thing you want is an insurance adjuster explaining why a larger portion of the claim cost will come from your own pocket. If improvements are being considered for your building, call your Trusted Choice® insurance professional immediately. The good news is that most insurance policies can be easily amended to reflect the change in value. Such a change will ensure that your building’s new value does what it’s supposed to do: Put money in your pocket.

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127 South Peyton Street
Alexandria, VA 22314
Phone: 800.221.7917
Fax: 703.683.7556
Email: Trusted.Choice@iiaba.net