Posted on May 19, 2014
When unexpected events such as floods, fires and earthquakes hit, commercial property insurance is there to help business owners with covering the cost of repair and replacement. Ohio business owners purchase this vital business insurance coverage based on the need to protect their buildings and contents from damage. In today's economy, finding ways to balance expenses with expected revenue can be a challenge even for insurance companies that provide this business protecting coverage.
Because of the havoc caused by devastating storms and inclement weather over the last few years, residential and commercial property insurance rates are expected to increase this year. Based on statistics from the Ohio Insurance Institute, natural disaster claims were up 187% between 2007 and 2011 when compared to the five year time frame just before 2007. The state's rates will still rank the sixth lowest overall; however, insurance companies are feeling the effects of hard economic times along with catastrophic tornadoes, hurricanes and severe weather that have hit various parts of the U.S. time and again in recent years.
The insurance industry overall has $580 billion in surplus reserves according to A. M. Best Company, and that figure does not include their future claims reserves. Most affected with insurance premium increases will be consumers and small business owners.
Ohio businesses should take time before the expected increased rates to review all commercial property policies. Check coverage and make sure it is accurate for present day property values. To help lower costs, it is wise to determine whether there is duplicate or unnecessary coverage that can be removed from existing policies. Changing the deductible can also be a way to reduce commercial insurance premiums. Taking care of evaluating coverage now will better position business owners when rates do rise.