Claims and Property Valuation

For the past several years, catastrophic insurance claims of all types have been occurring more frequently and with increasing severity. The Insurance Information Institute reports $25.5 billion of insured losses in the United States in 2019 as a result of natural catastrophes to include severe storms, wind, hail, wildfire, flood, and earthquake. Overall losses were nearly double that amount at $49.9 billion. It is critical that commercial property owners, including owners of self-storage operations, prepare for potential catastrophic losses resulting from natural events as well as manmade and accidental occurrences such as fire, roof leakage, slip-and-fall incidents, bodily injury, and others.

Property owners need to be aware that valuation affects the claim payment in the event of a covered loss. Replacement cost is the most popular insurance property valuation, and it provides coverage to repair or replace a building with materials of the same or comparable quality. This method of valuation does not include the value of any land. It does include the cost to purchase materials and hire professional contractors to repair or replace a building.

Here are some things to consider when discussing replacement-cost property valuation with your self-storage clients:

• Replacement cost coverage does not account for depreciation.

• The market cost of labor and materials to repair or replace a damaged building can fluctuate dramatically.

• Recent improvements and new construction should be considered when updating the insurance property valuation.

• If insuring with a policy that offers a blanket limit on signs, office contents, fences, etc., consider the value of everything that is covered by the blanket limit.

• The property valuation should include the cost of the foundation.

Ensuring that a self-storage operation is appropriately protected also includes the following:

• Purchasing adequate limits for customer goods legal liability is important in the event of a catastrophic event. The minimum limit available on MiniCo's BOP application is $25,000 and is typically not adequate in the event of a fire or other large loss.

• Business income (or business interruption) coverage is critical to an operation's survival in the event of a catastrophic loss. It is also one of the most complex, least understood, and most undersold insurance coverages available to property owners. Take the time to discuss the benefits of business income coverage with your self-storage clients.

• Risk management planning and performing maintenance tasks in a timely manner are more important than ever in helping to minimize potential claims and costly lawsuits.

The insurance industry is signaling that 2021 will bring significant premium increases of 8 to 15 percent for commercial property policies including the self-storage sector. It is necessary to evaluate premium costs in relation to potential out-of-pocket exposure in the event of a large loss, major liability claim, or catastrophic event. Be sure to address property valuation at the annual insurance review with each of your clients who are commercial property owners. If you have questions about property valuation or would like more information about MiniCo's specialty BOP for self-storage risks, contact an underwriter at 800-528-1056 or info@minico.com.

Tips to Get the Best Quote for Your Self-Storage Client

When submitting an application for a self-storage risk to MiniCo Insurance, keep in mind the following tips. Submitting a complete application can help your underwriter develop a premium proposal quickly and with the best possible pricing for your client.

• Use the Online Portal – MiniCo’s online agent portal is the fastest and most efficient way to submit an application for a self-storage risk. If you need to use a traditional application, please be sure to download the latest version directly from MiniCo’s website.

• Help the Underwriter – Remember that underwriters want to write the business, but they are required to justify their pricing. Be sure to include any information that could help in pricing the account. Don’t be afraid to mention negative information as this can aid in building trust with the underwriter.

• Don’t Guess – Unless you are fairly certain of an answer, don’t guess. Collect the required information prior to submitting the application.

• Know the Coverages – Be aware of the coverages requested on the application as some can have a significant impact on the final premium.

• Attach Documentation – Include photos, site diagrams, loss runs and any other documentation that can be useful in pricing the quote.

For more information about registering for the online agent portal or downloading an application, contact your underwriter at 800-528-1056 or info@minico.com.

Cyber Fraud and Business Email Compromise

Phishing is the preferred tool of cybercriminals, accounting for 93 percent of all breaches, which are conducted predominantly over email (2018 Verizon Data Breach Investigations Report). In a phishing attack, someone masquerades as a trustworthy source in an attempt to bait a user to surrender sensitive information, such as a username, password, or credit card number.

One type of phishing is known as business email compromise. This occurs when a hacker uses email to impersonate a business contact with whom the recipient is familiar. The hacker's goal is to convince the recipient to send payments to a new account controlled by the criminal organization.

Here are some best practices for minimizing the risk of cyber fraud via business email compromise:

• Protect your email system using stringent password protocols, multifactor authentication, and security software.
• Before you click on a link in an email or open an attachment, examine the sender's details in the "From" line, and delete it immediately if the domain name (after the "@") looks suspicious.
• Hover over links in the email to examine the domain name of the destination before clicking the link.
• Approach urgent requests or new payment instructions with added caution.
• If anything appears suspicious, call the sender and verify the request.
• If the email makes a request regarding payment accounts, always call the sender first.

MiniCo Insurance offers cyber insurance products for small and medium-sized businesses that address security and privacy liability, crisis-management costs, data recovery and loss of business income, regulatory defense and remediation costs, and cyber extortion. No supporting accounts are required, and premiums are competitive. We offer a preferred rating model specifically for self-storage risks with minimum premiums starting at $250.

For more information including a premium indication, contact Michael Attanasio at 518-782-3300 or michael.attanasio@minico.com.

MiniCo’s Corporate Holiday Schedule

The holidays are fast approaching, and MiniCo wants to ensure that you and your clients receive the highest quality customer service throughout this hectic time of year. Our corporate offices will be closed on the days listed below in observance of the holidays.

MiniCo’s Corporate Holiday Closures
• December 24th
• December 25th
• January 1st

If you need to report a claim during our holiday closure, please call 855-861-0876 to reach an adjuster.

We at MiniCo thank you for your business in 2020 and wish you a safe and healthy New Year!