Need quick help. Anyone have information on commercial insurance???

I am in a bit of a bind and could use some help. I don't need conjecture and "maybe you could try this" information. I need info hopefully from someone who DEALS with commercial insurance, or has in the past.

Situation: I have been renting a 7000+ sq ft shop building for 3 years now. I currently have $300,000 coverage on shopkeepers insurance and Liability insurance. I have been looking at increasing to $500,000 because the shop can afford this much of an increase. Here is the problem. The landlord just brought me a copy of an email that HIS insurance just sent him, stating that they want me to have $1,000,000 in liability coverage. Now we are in a VERY small community. I mean the entire county has less than 5,000 people in it. The replacement cost if the building, and all of the interior is less than $300,000. Hell, even my landlord said HIS insurance is not even at $500,000. So why is his insurance company stating that they require that I have a million? I certainly can't afford the $1100 per month premium for it! That is more than I pay in rent! If they require the million, and are not flexible, I may be forced to close up shop.

Any help and information from those who deal with commercial insurance would be greatly appreciated. My entire livelihood is at risk here.

 

Bumping for hopefully more people to notice this morning.

 

I wish I knew about this stuff..medical insurance is my niche.

Only thing I can suggest if you haven't already is researching it online to see if it's a state mandate that you have at least x amount.

Just curious, what are the rough amounts you'd pay for 300k or 500k worth?

 

Wish I could help Bill , I'm shocked at what your premium would be though as I pay about $2000 / year for $2 million liability as well as theft coverage for materials

 

Bill maybe your type of business is driving the rate??? Have you shopped around? I carried $1,000,000 for several years (just cancelled it within the last 5 years) of commercial liability coverage and your monthly fee is more than I was paying for a full year. I'd shop around if you've not already and I would see what specific coverage (not just value but what needs coverage) the property owner requires. Depending on your relationship with the LL you might see if you two can co-cover or if he'll re-negotiate your $$ per foot???

Good luck man.

 

Thanks for the support all. Some good ideas Joe, but yeah, no negotiating with the LL on this. To be honest his rent is pretty damn good of a deal. I will look at see what other insurance options I have.

 

Yea let us know how you end up with this. So, really the LL needs to amend your lease agreement right? I wonder if the LL has shopped for another insurence provider...maybe one that doesn't force him to change his requirments for you. If the LL has a mortgage on the property I'm sure it's not the lender attempting to revise the mortgage...it almost sounds a little fishy. So, if I understand, the LL's insurence provider is shifting the risk from themselves to another provider...or trying to get more $$$ to provide coverage.

 

Well it was not near what the initial person on the phone led me to believe. Increasing my coverage to a million will only cost me about $56 per year of an increase. That is nothing! Thanks for all the input though!

 

That's got to make you fell better.

 

Final update. After some insurance hunting with a few companies I was able to find 3 times the coverage for my shop, at a cost of $50 per year LESS than what I was paying before! Much happiness now!

 

Haha, nice! Double win, more coverage AND less money! Glad it worked out so well for you Bill..see, good things DO happen to good folks

 

glad to hear you found a solution i am an agent and adjuster (licensed) this is a situation i have never heard of? usually the landlord will stipulate in the contract what he requires as far as liability coverage. as far as i know HIS carrier cant make a demand like that to you, only to him.

ajust curios what services does your shop offer, do you deal with high risk activities? do you have a high volume of customers coming in and out everyday? like i mentioned above this is a bit of an odd situation, just wondering why all the sudden they would try to do this?

cheers,
disco

 

It is not odd at all here. We are a small town/community. The landlord was told by HIS insurance agency that they would not insure HIS part of the building if MY part did not have adequate coverage. As for high risk, ANY auto repair shop has high risk due to not only the flamable chemicals, but the chance of damage to vehicles and persona injury from moving parts, etc. Unless i am misunderstanding your meaning of "high-risk" The reason things changed was that his previous policy had expired, and he was renewing.

 

" The reason things changed was that his previous policy had expired, and he was renewing"

this makes more sense, at renewal the insurance company can change the terms of the contract. american modern is not renweing 75% of the policies in louisiana and we have roughly 1000 customers with them we have to re quote and place with another carrier. sorry took a while to get back to you but we have been extremely busy at work. i did do some refresher reading on commercial policy and went talk to the lady who is in charge of our commercial side of the agency. she said the obvious first, basically if something happened on your watch you would be sued first, but if the lawyers thought you did not have enough coverage or assets to satisfy the amount they were asking for they would then go after the owner of the property's insurance company. but it would be a little out of the ordinary for them to just do this out of the blue. when you get a policy it is a contract, even though there is almost always a clause that the company can change the terms at anytime, something this major usually is not done... except if your landlord would change carriers, let his policy expire and have a lapse in coverage or.... renewal time and underwriting takes a closer look. so what you said make alot of sense now.

cheers,
disco