Is your coverage keeping pace with your commercial property value?

Transcript

Is your business properly insured?

Up 16.5%

Thanks to near double digit inflation and rising costs for replacement material and labor, reconstruction costs rose 16.5% year over year from April 2021 to April 2022. This highlights the need to continually assess values.

What could impact your insurance to value needs year to year?

• Renovations
• Improvements and betterments
• Long lead times (supply chain challenged)
• Machinery/equipment
• Inventory

Material composite costs increased...

• Interior trim–29.4%
• Lumber–28.7%
• Roofing–16.5%
• Drywall–15.9%

Labor costs are up by...

• Drywall installer/finisher –12.7%
• Roofers–12.6%
• Electricians –8.5%
• Plumbers –8.1%
• Carpenters–7%

What can happen when your business is underinsured?

• Partial claim reimbursements
• Loss of customers
• Longer recovery periods

"It’s incumbent on businesses to maintain current valuations to avoid under-insuring their properties. In times of high inflation, it is more important than ever to make annual valuation adjustments, including to business interruption values."

Joel Lehman, Vice President, Hanover Commercial Property

 

All products are underwritten by The Hanover Insurance Company or one of its insurance company subsidiaries or affiliates (“The Hanover”). Coverage may not be available in all jurisdictions and is subject to the company underwriting guidelines and the issued policy. This material is provided for informational purposes only and does not provide any coverage. For more information about The Hanover visit our website at www.hanover.com ©2022 The Hanover Insurance Group. All Rights Reserved