By providing a pallet / box manufacturer with adequate property insurance, there are several key areas that must be reviewed to ensure that the coverage established meets the specific needs of your insured. We will review some of these here.
First, be sure to analyze all previous losses to obtain information about where exposure vulnerabilities exist and what additional loss control protocols can be implemented. In addition, carry out a thorough physical inspection of the entire installation, including the type of mobile equipment that exists, so that the correct coverage can be ensured. Any equipment that is not permanently installed in the building will require an interior navigation policy. Be sure to also evaluate any drastic changes in the stock, both finished and unprocessed, so there are no penalties for lack of insurance that generally come with property policies.
Discuss the co-insurance penalty in property policies with your policyholders so that they have a clear idea of what the impact would be if a loss occurs and, if possible, available options to eliminate the fine. This would depend on the operator and the ability to demonstrate that property boundaries are adequate to meet the chosen valuation. For a pallet or box manufacturer, an insurer will require a recent assessment of the buildings, an industrial assessment of the machinery and equipment, accurate and detailed information on the inventories, and accurate and detailed information on the reconstruction.
Other problems to examine include having coverage for a higher construction cost due to changes in the ordinance and / or laws. For example, an insured's policy form that has replacement cost coverage will reconstruct the destroyed property with similar quality materials, but what happens if the building does not comply with the current code or if the state or local code requires that a building be completely demolished? incurred 50% or more in damage? You want coverage that will respond.
Also, evaluate the potential for loss of income and additional expenses in the event of a fire or other loss that forces the manufacturer of pallets or crates to close while repairs or reconstruction are being made. Reviewing the client's financial statements to determine the exposure and the limits required to maintain a functioning business is critical. Also, see what would happen to the business if one of its critical suppliers suffers a significant loss and the impact it would have on the insured's functioning.
We would be happy to review all considerations related to determining the correct commercial property insurance program for a pallet or box manufacturer. Continental Underwriters, Inc. specializes in the forest products insurance industry and offers comprehensive insurance and loss control to help protect assets and help curb losses. Call us at 866.730.5806 to get more information about our programs.
Video credits to Continental Underwriters YouTube channel