When it comes to self-storage, “standard coverage” is anything but standard. These facilities operate in a space where everyday risks look very different from those faced by traditional commercial properties, and so do the coverage needs. That’s exactly why specialized self-storage insurance exists: to account for the realities of the industry and ensure your clients are fully protected when the unexpected happens. In this final installment of our three-part series, we’re breaking down the essential coverages agents should be recommending, and why they matter.
How Do Standard Businessowner Policies Fall Short?
For self-storage operations, it can feel like danger lurks around every corner. They don’t just face fire, wind, and slip-and-fall risks. They also navigate legal exposure tied to lien sales, tenant claims over damaged property, cyber threats, and more. A one-size-fits-all business owner policy may not address the nuances of these risks, leaving self-storage facility owners exposed. Specialized coverage addresses those blind spots. It evolves alongside the facility from construction to expansion, and is designed to respond to the specific perils inherent to storage operations.
Core Property Coverages Every Facility Needs
These self-storage insurance coverages form the backbone of a strong risk management strategy, protecting both physical assets and business continuity.
Business Property/Blanket Property
Protects buildings and business personal property at replacement cost. A blanket option extends coverage across multiple locations, making it ideal for operators with more than one facility.
Building Ordinance or Law
Covers the increased cost to repair or rebuild property to meet updated codes or zoning requirements after a loss, which can add significantly to reconstruction costs.
Course of Construction
Provides protection for buildings, equipment, and fencing during construction or expansion projects, including theft of materials, a frequent but overlooked risk on job sites.
Liability Coverages That Address Industry-Specific Risks
Standard general liability isn’t enough in a self-storage environment. These self-storage insurance policies address exposures unique to the industry:
Comprehensive Business Liability
Covers premises and operations, products, personal and advertising injury, medical payments, and auto liability for hired and non-owned vehicles.
Customer Goods Legal Liability
Protects against claims of loss or damage to tenants’ stored property, one of the most common (and costly) claims in self-storage. It also includes defense against allegations.
Sale and Disposal Liability
Essential for lien sale exposures. Covers claims stemming from negligent acts during lockouts, sales, removals, or disposals of tenant property, including defense costs.
Employment Practices Liability
Protects against claims related to wrongful termination, discrimination, or harassment, exposures that grow as operations and staff size expand.
Employee Dishonesty
Covers losses from theft or fraud committed by employees, especially important in facilities where payments or property handling occur on-site.
Specialty Coverages That Close the Gaps
Self-storage specialty coverages were developed to address exposures unique to the sector that traditional policies don’t cover. MiniCo offers these coverages in its self-storage businessowner’s policy.
Limited Pollutant Removal
Covers cleanup and liability associated with pollutant-related incidents, which can otherwise result in significant out-of-pocket expenses.
Data Compromise Coverage
Addresses the growing risk of cyberattacks and data breaches, from hacked access systems to stolen tenant payment data.
Business Income (Business Interruption)
MiniCo offers 15 months of business income insurance coverage as standard, with options to extend to 18 or 24 months. That extended timeline is critical in areas prone to catastrophic weather or supply chain delays, where recovery often exceeds one policy year.
Umbrella (Excess Liability)
Provides additional liability coverage beyond primary policy limits — a must as nuclear verdicts and large jury awards become more common.
Questions Agents Should Ask to Identify Coverage Gaps
To build a self-storage insurance policy for your client, you need to dig deeper, beyond basic property and liability questions. Use this checklist to uncover exposures your clients may not realize they have:
- Do you conduct lien sales on site, and how often?
- Do you store vehicles, boats, or RVs on the property?
- Do you offer climate-controlled units or specialty storage (e.g., wine, documents)?
- What cyber protections do you have in place for tenant data and access systems?
- How many employees do you have, and what are their roles?
- Do you contract with third-party service providers for maintenance, snow removal, or security?
- Do you have tenant insurance requirements outlined in your lease?
- Are you located in a flood zone or an area prone to wind or hail events?
- How many months of business income insurance coverage would you need to fully recover from a major loss?
FAQs: Key Coverage Questions Answered
Q: Isn’t general commercial property insurance enough for self-storage?
A: Usually not. Standard policies often exclude critical exposures like customer property damage, lien sale liability, and cyber risks. Specialized coverage fills those gaps.
Q: How much business income insurance should a self-storage facility carry?
A: At least 15 months, with options for 18 to 24 months. Recovery from catastrophic losses, especially in coastal or storm-prone regions, often takes more than a year.
Q: Do self-storage operators need cyber coverage?
A: Absolutely. As facilities adopt automated access, online rentals, and digital payment systems, they increasingly become targets for cybercrime. Data compromise coverage is essential.
Q: Why is umbrella coverage important?
A: As jury awards and litigation costs rise, umbrella policies provide an additional layer of protection beyond primary liability limits.
The Bottom Line
MiniCo excels in covering exposures that standard commercial policies were never designed to address. With decades of experience focused exclusively on the self-storage industry, we understand the nuanced risks your clients face and offer tailored solutions built to address them, including extended business income insurance, data compromise coverage, and specialized liability options that reflect today’s legal landscape. By partnering with MiniCo, you can give your clients peace of mind, comprehensive protection, and a true insurance partner invested in their long-term success. Contact us to learn more and get a quote.
