Commercial office buildings offer a mutually beneficial relationship for owners and tenants, allowing businesses to thrive while keeping overhead costs to a minimum. Unfortunately, a tornado can ruin buildings and carry away inventory in minutes, eating through both parties’ profits for weeks after a storm. Attorney Bill Voss explores vital insurance coverages for owners of commercial office buildings, including those that will help you reopen after a tornado strikes.
Extended Tornado Insurance Coverage for Office Buildings in Texas
If your business is located in Galveston County or elsewhere on the Texas coast, your commercial insurance provider may exclude coverage for wind damage due to high risk. Owners may need to purchase a policy through the Texas Windstorm Insurance Association (TWIA) in order to recover costs for tornado damage.
If your commercial property insurance does include damage from high winds, you can further protect your investment with policy endorsements, including:
- Newly-constructed or acquired properties. If a tornado strikes just after you have purchased an empty strip mall or in the middle of construction on a new property, these holdings may be exempt from coverage. Owners should check their policies to see if temporary coverage on new properties is included, or if they may benefit from builder's risk insurance to cover properties that are not yet complete.
- Building ordinance and law. If a building has suffered structural damage, the damaged portion must be rebuilt in compliance with current building codes. If insulation, utilities, or structural integrity has been compromised, the owner may be forced to completely overhaul the structure—a cost that quickly rises into the millions. Ordinance and law coverage pays for the increased cost of bringing a damaged structure up to code, and may even cover costs of aesthetic damage (such as custom-made windows or specialty wallpaper).
- Commercial auto damage. Commercial auto coverage can be invaluable for property owners who rely on company vehicles. Whether you command a fleet of vehicles or have a small number of luxury cars for business use, comprehensive coverage can provide payment to repair windows, bodywork, or other damage to your commercial vehicles. Even if your commercial auto policy specifically includes natural disasters, you should double-check whether the coverage includes specialized equipment inside the vehicles (such as GPS systems, refrigerators, or sound systems).
- Service outage losses. A tornado can cause whole cities to lose power, water, internet, or sewer services for an extended period of time, making it impossible for you to make repairs or lease vacant spaces in your building. An endorsement to protect against utility losses can pay for the cost of temporary lighting, increased cleanup and hazardous waste costs, and other losses caused by power interruption.
- Equipment breakdown. Owners may need additional coverage for on-premises equipment, such as the boiler, heating, cooling, and plumbing systems. Some or all of these systems may not function properly after a storm, and may need to be repaired or replaced before tenants can move back in.
- Seasonal business insurance. Many businesses have periods during the year that are especially profitable, and missing one or more of these due to a tornado can cause the business to drop into the red. Seasonal business insurance offers extra protection against income losses during peak times, containing the losses to a single quarter rather than the entire fiscal year.
- Business income loss. Business income insurance, also called business interruption insurance, ensures payment for your normal ongoing operating expenses after a covered event. This can include the cost of paying your employee’s salaries, moving your main office to a temporary location, or reimbursing business profit losses for up to six months after the tornado hits. There are also extensions to business income insurance, such as extra expense coverage and umbrella coverage, which may pay for out-of-pocket costs as well as an additional amount when policy limits have been reached.
If you need help getting payment for your losses after a tornado, our commercial insurance claim attorneys can work to get you full and fair compensation to make repairs and reopen your doors. Please contact the Voss Law Firm at 1-888-991-3212 or simply fill out the form on this page today to get answers to your questions.
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