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Commercial Property Update

Several industry surveys predict that property insurance costs will rise even more in 2023, especially in the west and south, which are more prone to natural disasters. The twentieth consecutive quarter of rising rates occurred in the fourth quarter of 2022.

Due to the high cost of reinsurance or the difficulty in obtaining it in catastrophe-prone areas or with accounts that have a history of substantial losses or poor risk management, the capacity for property accounts has significantly declined. Furthermore, the continued effects of inflation are raising the costs when a loss does occur.

You can experience one or more of the following in addition increase in your renewal premium:

1) The minimum and maximum wind and hail deductibles will rise to 2% and 5%, respectively. In certain cases, we’ve seen businesses flatly decline to write wind insurance.

2) If you want replacement cost coverage, updates to the roof, plumbing, electrical, and HVAC (heating and air) must all have been made within 25 years.

3) The condition to insure the property to 100% of your replacement value will require greater details.

4) Depending on location-specific factors, requirements will be for central station burglar, fire, and sprinkler systems.

The replacement cost of your property is increasing along with inflation. Every year, you should coordinate with your agent to make sure you have the appropriate replacement cost insurance. A co-insurance limit (often 80%) applies to any commercial property, which implies that your coverage limits must include at least 80% of the building’s worth to avoid incurring the co-insurance penalty, which might be significant.

At Dahlmeier Insurance Agency, Inc., we’re committed to keeping your business protected – so you can focus on your day-to-day operations. And with the right insurance plan, your business will be covered from top to bottom.

We offer the following options for your business assets:


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