Is your commercial roof coverage as good as you think it is? Exclusions in commercial property insurance policies are becoming very common. Here’s what you need to know about roof limitation endorsements.
Hail Damage Exclusions
If you look at property insurance policies written in recent years, you might notice clauses that exclude certain damages caused by wind and hail.
These clauses can vary, but if you have one in your policy, cosmetic damage caused by wind and hail may not be covered. This means that if a storm dents or damages your roof and you want it fixed, you may have to pay for the repairs yourself.
Why Are Cosmetic Damage Exclusions Common?
Insurance underwriters have to calculate risks in order to determine rates and coverage, and this can be tricky when key terms are vague. According to Claims Journal, “damage” is often not clearly defined in policies, and this can lead to any type of damage being covered. At the same time, the risk of minor hail damage can be especially difficult to evaluate. Cosmetic damage exclusions may be used clarify and limit exactly what type of damage is or is not covered.
Back in 2013, Insurance Journal wrote about the introduction of cosmetic damage limitation endorsements filed by both the American Association of Insurance Services and Insurance Services Office (ISO), two organizations that produce standardized forms and policies for property and casualty insurers. The new endorsements impacted both homeowners and commercial property owners, and it was predicted then that they could become the norm.
Check Your Policy
You don’t want to find out that you don’t have enough insurance coverage AFTER an incident occurs. Take time now to check your policy.
- Review your policy for exclusions. If you have questions about your policy, talk to your insurance agent.
- Assess your risk. It also makes since to consider how likely a storm is in your area. According to the Insurance Information Institute, there were 5,396 major hailstorms in 2019. Major hailstorms were most frequent in Texas, Kansas, Nebraska, South Dakota and Colorado.
We encourage you to check in with our brokers for assistance in understanding your policy’s coverage and exclusions.