Preparing for Hail, Wind, and Severe Storms

The impact that catastrophic hail and wind events have had on property owners and the insurance industry would be difficult to overstate. The National Oceanic and Atmospheric Administration (NOAA) recorded 5,396 major hailstorms in 2019. Those storms affected more than 7.1 million properties in the U.S. resulting in losses of more than $13 billion according to the Verisk report U.S. Hail Damage Insights.

We generally think of hail storms occurring during spring months, but data from the past several years indicates that severe storms can occur throughout the year. The Verisk report notes that the threat of severe hail storms now extends well outside of "hail alley" (Colorado, Nebraska, and Wyoming) to include the Midwest, Gulf Coast, Appalachia, and the desert Southwest. In 2020, the states with the highest number of major hail events were Texas, South Dakota, Kansas, Oklahoma, and Nebraska.

Hail events can cause catastrophic damage to commercial properties and often result in repairs or replacement of the entire roof or the damaged portions of the roof. For property owners, this is an unwelcome and unavoidable potential peril. However, property owners can take action to prepare for severe weather and help minimize storm damage. Here are some recommendations for insurance agents and their clients to discuss.

Insurance – Total reconstruction costs, including materials and labor, increased nearly 5 percent on average from July 2019 to July 2020 with increases shown in all states. Steel prices are projected to continue to rise in 2021. Given the current underwriting and reconstruction cost trends, a mid-term review and adjustment to your client's policy may be a wise decision to ensure that valuation and out-of-pocket exposures have been appropriately addressed.

Facility Maintenance – Property owners should perform maintenance tasks that can help reduce potential damage such as trimming trees, securing equipment, and tying down items that could become airborne and cause damage during a severe storm.

Roofing – Property owners should schedule regular inspections with a qualified roofer to evaluate the condition of the roof and perform necessary maintenance on any areas identified as defective.

Wind/Hail Deductibles – For commercial properties located in high-risk areas and policies that include large percentage or flat deductibles, agents may wish to discuss adding a wind-deductible buy-back policy.

For coverage questions about MiniCo's commercial property policies, contact your MiniCo underwriter directly or email info@minico.com.

Cyber Insurance for Self-Storage Risks

Self-storage facilities, along with other small and medium-sized businesses, are increasingly vulnerable to the risk of cyberattacks and data breaches. While many business owners underestimate the threat, the reality is that cybercrime is one of the fastest-growing risks to businesses of any size. Business owners would be wise to develop a risk management plan that includes cyber insurance.

If the policies for your self-storage clients do not currently include coverage for cybercrime, it is strongly advised that it be added. MiniCo's specialty BOP for self-storage risks includes optional cyber and data compromise coverage with a limit of up to $50,000. The coverage provides a variety of services to help businesses respond to data theft including electronic theft (hacking), laptop theft, theft of hard copy files, employee theft of corporate data, accidental publishing, fraud, and procedural efforts. Identity recovery coverage is also included and provides case management service and expense reimbursement coverage if certain requirements are met.

Many businesses, however, need additional coverage to address this exposure. Our monoline cyber insurance product for small and medium-sized businesses addresses a range of exposures including breach response, business interruption loss, cyber extortion loss, data recovery costs, data and network liability, and eCrime. Preferred rating is available for self-storage risks.

For more information about cyber insurance or to get a quote, contact Michael Attanasio at 518-782-3300 or michael.attanasio@minico.com. No supporting MiniCo accounts are required for the monoline product.

Self-Storage Claims and Rising Financial Exposures

The trend of record-breaking wildfires, hurricanes, hail, wind, and other catastrophic weather events has made property owners and their insurance agents more aware of the potential for insurance claims and out-of-pocket expenses. The rising cost of reconstruction further emphasizes the need for insurance agents to review coverage with their clients to ensure that policyholders understand the financial exposure they may face in the event of a catastrophic loss.

MiniCo's claims professionals advise that insurance agents and policyholders engage in an annual coverage review to address deductibles, policy limits, wind and hail deductibles, deductible buy-back solutions, coverage limits on roofing, and coverage for cosmetic damage to roofs and other structures.

For the most efficient handling and resolution of self-storage claims, MiniCo recommends reporting claims via our convenient online forms or an ACORD form. Reporting a self-storage claim through an email only (without a MiniCo or ACORD reporting form) may lead to delays if essential information is missing.

REMINDER: Please notify MiniCo immediately upon receipt of a notice of possible litigation or retention of an attorney involving any policyholder. Giving our claim professionals the maximum time available to respond is crucial to the effective resolution of the situation.

On the Road with MiniCo:
Upcoming Conventions

Representatives from MiniCo Insurance will be traveling to a number of insurance and self-storage industry events in the coming months. If your plans include attending any of these shows, we hope you will stop by the MiniCo booth.

May 17
San Diego I-Day
San Diego, California

August 21-23
Big I Oregon InsurCon
Sunriver, Oregon

August 24-25
IIABAZ Convention
Scottsdale, Arizona

October 3-6
Applied Net
Nashville, Tennessee