Here’s a frightening thought, and one you ought to share with your business clients. A study by the brokerage, Towergate says the rapidly rising cost of rebuilding has put 90% of commercial businesses in the U.S. in the underinsured category.
You read that figure correctly. It’s 90%.
Towergate found that the cost of construction materials has risen 20% in the last few months. Company spokesman, Robert Lewis said most businesses are only insured for about 68% of the rebuilding costs. That puts many businesses out of the rebuilding market if something were to happen.
“In the simplest terms, buildings should be insured for the amount that it would cost to rebuild them. However, this shortfall in cover is being fueled by a sustained rise in construction costs,” he said, ““We find ourselves in a perfect storm. The cost of energy is increasing rapidly, which has a major impact on production costs there is huge demand for building materials.”
Source link: Reinsurance News — https://bit.ly/3JTa88t
Commercial Property Insureds — Underinsured
About PIA Western Alliance
The Professional Insurance Agents Western Alliance is a membership organization promoting and enhancing the success of independent agencies seeking to grow, learn and be heard within the industry.
PIA WESTERN ALLIANCE VALUES OUR STERLING PARTNERS