Historic property commercial insurance comes in handy for the more than 92,000 listed properties in the National Register of Historic Places. When you’re ready to place insurance for your historic property client, a risk management adviser will help you get the coverage that you need. National Trust Insurance Services knows exactly how to assess each individual property’s risk, uniquely customizing a comprehensive program that best suits the needs of your client. When managing the risks of a historic property, it’s important to think about some key things that will help maintain the historic significance. You’re going to want to make sure that you understand every historic concept inside and out, in order to relay to your client. Read on for some risk management advice for historic properties, courtesy of the International Risk Management Institute.
Breaking Down the Process
The first thing that an underwriter is going to want to know is exactly how old the property is. Not only do they need to make sure it’s valid as a historic property, but they also need to make sure they know when exactly it was built—pre-war or post-war. 13 percent of historic buildings were built more than 75 years ago. When the property was built matters because it tells us what type of materials were used to build it. How the building was made will determine the underwriting acceptability. When the updates were last completed to the HVAC, plumbing, electrical and roof also helps to show how the property has been maintained. This is important to know how the historic property has been cared for in all the years past.
How to Secure Proper Coverage
The next step of a risk management adviser is to let the owner know that there’s no correlation between market value or purchase price and the cost to rebuild a historic building. It’s important to establish how much it would cost to rebuild the property. Working backwards when getting information from a client is a good way to continue the process. Asking questions like, “Would you want complete coverage in the event of having to reconstruct?” are just some of the things that a risk advisor can ask. Everything depends on the features, which is another question any good risk advisor would ask. It’s another way to find out which features of the property should be insured. Our program recommends utilizing a Historic Replacement Cost appraisal service to estimate appropriate values and obtain corresponding coverage limits.
Getting Important Coverage Enhancements
Once coverage is established, it’s important to look at the contract and make sure you know exactly what’s going to be covered. Once the proper cost to rebuild has been established, it’s time to secure a loss settlement feature. While it’s difficult to achieve, it’s important that a risk advisor can get full coverage for the cost of rebuilding a property. Don’t forget about the percentage caps that restrict the amount of coverage from a total loss. Think about any detached garages, historic outbuildings or historic personal possessions that might be on the property—those are going to need to be covered as well.
The nature of insuring historic properties makes it a specialty risk. Working with experts in the field will help you in placing business without the added headaches. Let us provide the resources and answers to the issues facing your historic property clients.