Even a moderate windstorm can cause costly damages to industrial properties, many of which require fast repairs to prevent further losses. Unfortunately, many owners are shocked to discover that their commercial policies do not cover wind damage—or the language used in the policy makes it impossible to tell whether these losses are covered or not. Attorney Bill Voss explores essential forms of wind insurance coverage warehouse owners should secure in order to recover from these events.
Damage to Warehouses and Industrial Properties After a Wind Storm
Owners of warehouses and industrial properties have unique needs when it comes to protecting themselves from wind storms. The high walls, flat roofs, and large windows common to industrial properties can be smashed by objects tossed around in the storm, while winds traveling fast enough can peel a roof off of a structure. Once the interior of the structure is exposed to the elements, owners can suffer millions of dollars in lost inventory as well as the loss of highly-specialized machinery.
Owners should carefully assess their properties before selecting their insurance options to make sure their wind claims will cover:
- Structural damage. The majority of structural damage caused by windstorms happens on the roof. Shingles may be torn off, flashing around the vents may peel away, and air conditioning and HVAC systems may be blown over. Even if the roof is not shingled, the materials used to cover the roof (such as gravel or plants on “green” buildings) can be damaged or carried away in the storm. Undiscovered roof damage can cause further losses months or years after the initial storm, making it likely that the insurer will deny future claims.
- Electrical equipment. Water intrusion is common after a wind storm, either because the storm brought rain or spilled stored liquids on the premises. Industrial properties are often outfitted with sensitive equipment (such as production lines) and expensive electronics (including security systems) that may be ruined by the combination of wind and water entry.
- Heavy machinery. Industrial locations are often used for manufacturing and may involve damage to loaders, industrial ovens, scissor lifts, golf carts, drill presses, 3D printers, industrial sewing machines, and other specialized machinery.
- Finished and unfinished inventory. Warehouses can store goods in many different stages of production, from raw materials to finished objects. However, some insurance policies will only cover the loss of completed items, and may not compensate owners for parts held in storage, components waiting for installation, or goods held for a third party outside of normal business operations.
- Outdoor areas. Certain policies may only cover “door-to-door” coverage, excluding the loss of any landscaping features, external signage, loading docks, sheds or barns, and other outbuildings on the premises. Policy extensions may also be needed to cover employee parking lots, as well as damage caused by fallen tree branches.
- Indirect damage. A policy may cover direct damages but specifically exclude the damages caused by the aftereffects of a storm, including fires due to gas leaks, damage to vehicles parked on the property caused by flying debris, or stock losses resulting from power outages.
- Business interruption. Warehouse operators may not rely on retail or rental income from the public, and they can suffer extensive and prolonged income loss if they are unable to provide fulfillment services to their customers. Business income replacement can provide up to six months worth of losses to replace lost inventory, secure alternate suppliers, provide employee payroll, and pay for other costs of doing business until normal operations can be resumed.
If you invested in windstorm coverage for your property only to see your claim denied when you need it most, we can help. Our attorneys work to get full and fair payment from commercial insurance carriers that act in bad faith. Simply fill out the form on this page today to contact an insurance attorney at the Voss Law Firm or order a free copy of our book, Commercial Property Owners Must Read This BEFORE Filing an Insurance Claim.
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