Customers who have homeowners’ insurance may find their coverage for goods in storage is limited. Restrictions commonly found on a homeowner’s policy may:
- Limit duration of coverage for goods in storage to 30 days.
- Reduce and restrict limit for the contents in storage.
- Restrict coverage, such as no coverage for losses arising from theft or water damage.
- Require an increased deductible.
- Offer no coverage available for contents stored off premises.
Unfortunately, facility operators are not alone when it comes to understanding the insurance issue, as many of their customers have not even considered it. Let’s face it: Most often people only really pay attention to what is covered when things go wrong. This is usually because they have not read their policies, consulted with their insurance broker, or purchased insurance specific to their goods in storage. An informed storage operator with the help of an experienced broker will ultimately facilitate a good solution for customers.
Making the Offer
Storage operators should consult their lawyer when drafting their rental contract. Be sure to include a section pertaining to insurance and what responsibility is assumed by the facility. Having a lawyer review the rental agreement is critical, as you want to ensure your contract with your tenant is acceptable and legal. Each state has its own legal issues to be considered.
Assuming you have decided to offer a solution to your customer’s insurance needs, determine how this will be best accomplished. In my experience, it’s best to allow the customer to choose a limit that suits his individual requirements.
Choose an insurance broker with experience in the self-storage industry, one who has taken the time and investigated compliance issues with state and local laws. Tenant insurance is not just another added value but an opportunity to ensure you and your customers are protected following an unforeseen event or catastrophe.
Tobias (Toby) Struewing is a commercial account executive for Cowan Insurance Brokers Ltd., a provider of insurance and risk management products and services for the Canadian market. For information, call 866.912.6926; e-mail firstname.lastname@example.org; visit www.cowangroup.ca.