If you own an apartment building in North Carolina or other Southern States you may be seeing your commercial insurance rates skyrocket. You’ll hear brokers say there’s nothing much we can do “it’s the market”. And while the commercial insurance marketplace is very disrupted right now for property coverage in the South, and for Apartment Buildings in general – I don’t accept the premise that it’s just the market and throw up my hands. In this article, I’m going to talk about apartment building insurance in North Carolina and how it’s a sticker shock.
If your insurance costs are escalating 30 percent, 40 percent, or maybe even 150 percent or more that’s eating directly into your net operating profits, and maybe it’s time for a second opinion.
First, it doesn’t matter if your policy is renewing soon, or if it renewed a month ago, or six months ago.
I’ve looked down the barrel of a huge rate increase or am already paying it we should chat.
Second, let me be clear about the claim history.
If your building or portfolio of properties has suffered above-average loss activity, there may be nothing you can do in the short term to fix the price problem, but I do recommend taking a critical look at your losses, what caused them, and how you can prevent them from occurring again in the future.
If you need help here and other apartment building insurance issues, give me a call and I can walk you through that.
In fact, I did a short video on loss ratios which is what I’m talking about here that you can view here:
What is Loss Ratio, and why is it important to know about.
Third a common problem we see with a lot of real estate investors is underinsurance.
And, I get that.
You may think that a building will never entirely burn down so you might underinsure to save some money on your premiums, but this can come back and bite you in the butt in several ways, so I recommend evaluating the replacement costs on your building so we have a more realistic conversation.
Finally, are the general conditions, maintenance, and risk controls.
The habitational properties that get the best rates are by no coincidence the ones that are really well maintained.
Regular inspections of properties, planned maintenance, and good housekeeping all add up to better-than-average conditions for underwriting which is a win for you.
If you’re a property investor in North Carolina or really anywhere in the U.S. and think you’re overpaying for your property and liability business insurance, why not give me a call, or drop me an email?
Let’s chat and see if we’re a good fit for you and your business operations.
Thanks!
