Several factors make vacant and idle facilities particularly vulnerable to loss. The most common property perils facing a vacant and idle facility include fire, vandalism, and inclement weather. While these perils are also present for operating facilities, they are magnified when a facility is vacant, operating on a skeleton crew, or idled.
During this period of uncertainty and reduced staffing due to COVID-19, it is especially important to prepare and mitigate the risks that are unique to vacant or idle facilities. The following strategies can help mitigate the risks with vacant and idle buildings:
Ensure that fire protection systems are maintained and fully functional. Verify that sprinkler control valves are secured in the open position and that fire pumps are in the automatic setting. The typical service and maintenance activities for fire protection systems should be continued where possible.
Central station alarm companies and local fire departments should be notified when a facility is vacated or idled. The emergency response procedures and alarm protocols should be discussed and adjusted to address the lack of on-site personnel.
Fuel and power should be verified and maintained for any fire pumps and special extinguishing systems.
Housekeeping conditions should be addressed to eliminate or reduce any unnecessary combustibles in the building. Combustible storage outside the building, such as idle pallets, should be eliminated. Waste receptacles should be emptied and secured.
Operations involving flammable or combustible liquids should be discontinued, and flammable liquids should be removed or relocated to properly protected areas.
Steps should be taken to ensure that critical machinery is shut down and idled in a safe manner. Equipment manufacturers should be consulted for guidance on long-term shutdown of sensitive machines.
The perimeter building areas and exterior doors should be secured. Personnel with keys and key cards should be reviewed to ensure that only designated approved individuals have access to the building.
CCTV cameras should be verified and/or installed to cover sensitive areas. Remote monitoring should be established by designated facility personnel or central station alarm companies.
Building roof areas should be inspected to ensure unnecessary storage is removed from the roof. Building drains and scuppers should be cleaned to ensure effective drainage.
If you have any questions, please do not hesitate reach out to your Gulfshore Insurance Client Advisor who can offer assistance. We are here to help.
Across the world, COVID-19 is upending daily life. Below are two important insurance updates to keep you in the know.
COVID-19 and Auto Rate Relief
Americans who are suffering financially due to COVID-19 may have relief coming for insurance payments. Many insurers have announced auto insurance premium discounts to recognize that insureds are driving less during the coronavirus crisis. According to the Insurance Information Institute, these discounts, refunds, dividends and credits total $8.1 billion. It is estimated that this total will reach $10.5 billion as more auto insurers announce their offers. In addition to offering discounts, many carriers are also relaxing payment terms, and some are adding free coverages for identity theft, delivery services, and other needs. Many states have asked or ordered auto insurance companies to provide flexibility to customers who are financially affected by COVID-19. Specifically, Florida has encouraged insurers to be flexible with premium payments in order to avoid lapses in coverage.
COVID-19 and Teleworking: Coverage Issues
With many “shelter in place” municipal orders in place, it logically follows that more business operations and activities are now occurring in the home. You might be wondering, what are the insurance implications of this? Homeowners policies contain various property restrictions for business property and liability exclusions for business activities occurring in the home. Such restricted coverage reinforces the policy’s intent to cover only personal-related loss exposures and not business-related ones. This approach thus encourages individuals to cover their business loss exposures with commercial insurance policies or home business endorsements. Courts have generally held that a business must contain two elements: (a) continuity of the business activity, and (b) a profitability goal. Thus, for traditional employees who previously worked in an office Monday through Friday and now telework those same days on a temporary basis, they are likely not to encounter any new coverage gaps. Conversely, a business owner who operated his or her business outside the home and now operates this business in the home should reach out to his or her insurance agent to properly insure any emerging and uncovered loss exposure gaps from this ever-evolving COVID-19 phenomenon.
We will continue to provide updates on emerging insurance issues amidst the COVID-19 crisis. If you have any questions or concerns, please do not hesitate to reach out to Gulfshore Insurance.
Andrea Pelletier, CPRIA, CPIA is Client Advisor and Partner at Gulfshore Insurance specializing in Private Risk Services. Andrea works with successful individuals and their families on creating and customizing package insurance solutions in the areas of luxury homes, car collections, jewelry, fine arts, watercraft, and personal excess liability. Comments and questions are welcome at email@example.com