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Retailers Insurance Group Blog

All You Ever Wanted to Know About Insurance

Property Insurance and Insuring to Value

Marshall and Swift research has indicated that up to 75% of commercial businesses are under-insured by an average of 40 percent or more greatly impairing the possibility of recovery from a major loss.

In recent years, devastating weather has become a big problem. It has resulted in billions of dollars in storm related losses such as fire, hail, flood and windstorm destructions.  Experts predict that severe weather will likely continue deep into this century.

Property insurance is supposed to protect people and companies against financial losses that occur because of damage to property.   The amount of property insurance needed should be based on the cost to rebuild and restore the structure.  In determining property value, many will default toward market value while others will look at the tax assessor’s assessment for guidance.  Both strategies fall short.

Sometimes the property owner chooses to rebuild a structure differently to perform the same function.  An example of this could be a second floor apartment or storage area that has not been used in many years and would never be included if something should happen. Discussing this strategy with your representative could result in a lower premium vs full replacement cost.

Insurance to value is a one of the critical pieces.  We collaborate with Travelers Insurance to help you with this evaluation and the business income piece. For the complicated structures a periodic evaluation from an appropriate contractor would be advisable.