Have you recently heard the phrase “a roof over one’s head”? Here, we say “roof” when we actually mean an entire living space. This highlights the importance we place on roofs. Roofs, after all, shield us and our belongings from harsh elements and natural disasters.
Because of how important and significant the roof is, some may think it is automatically included in property insurance. Unfortunately, this is not always the case. This article tells you all you need to know about common roof exclusions in commercial property insurance.
What Is Commercial Property Insurance?
Commercial property insurance is considered one of the fundamental types of insurance that a business owner needs. This type of insurance coverage protects a business during unforeseen events such as:
- The property is damaged, made unusable, or becomes inaccessible due to covered natural disasters/weather anomalies or acts of vandalism.
- The property is subjected to theft.
- The contents of the property (documents, equipment, personal belongings) are lost or damaged due to the above causes.
- The business undergoes an interruption and loses income due to the aforementioned causes.
The right commercial property insurance has a broad coverage that many business owners and property owners benefit from. However, if you are a policyholder, it is important to understand your coverage thoroughly so that you are not blindsided by insurance policy exclusions involving the property’s roof.
What Do We Mean by Roofing Insurance Exclusions?
Not all commercial property insurance plans are the same. Some have more policy exclusions than others. One of the most common exclusions to watch out for is roof exclusions or roofing insurance exclusions.
Essentially, when talking about roofing insurance exclusions, it could mean any of these three:
- The roof, by its nature and according to the pertinent insurance policy, is not insurable and is excluded from the commercial property insurance plan;
- The roof is covered in the insurance plan but the cause of damage is not covered; or
- The roof exclusion is a voluntary endorsement in your insurance.
Common Roofing Insurance Exclusions in Commercial Property Insurance
1. The Roof Is Not Insurable Due to Its Age
If the roof of your commercial building, hotel, apartment complex, and other types of structure is 20 years old or older, it may not be covered in some commercial property insurance plans. Twenty years is the usual cut-off age for insurable roofs because this is the average lifespan of most shingle roofs and flat roofs.
For a flat roof, even if a new layer is added, but the lower layer(s) are more than 20 years old, the flat roof can still be deemed uninsurable.
However, you may be thinking, “How do commercial buildings older than 20 years still get insurance for their roofs?” Well, for this specific roofing insurance exclusion, it’s not about the age of the property; it’s mainly the age of the roof that’s being assessed.
So if your commercial property is much older than 20 years but with a regularly replaced roof, your roof may still be covered under commercial property insurance – with the right insurer.
2. The Roof Is Not Insurable Due to Its Materials
When it comes to commercial roofing, some materials are just too risky to insure for some insurance companies. This could be because the material is easily damaged or expensive to replace.
Therefore, some insurance providers will deem the roof uninsurable if it is predominantly made of the following materials:
- Slate; and/or
- Expensive metal roofs (e.g. copper roofing, metal shingles).
3. The Roof is Not Insurable Because It Is a Flat Roof
Though a large number of commercial properties have a flat roof, the unfortunate truth is that flat roofs are commonly excluded from commercial property insurance plans. This, of course, still depends on the insurer.
The reason why flat roofs are often excluded by most insurers is that they are perceived to be at a significantly higher risk of weather damage and water infiltration. This is why there is a specialized type of insurance called commercial flat roofing insurance for properties with this kind of roof.
4. The Cause of Roof Damage is Not a Covered Peril
There are a number of perils that can be excluded from commercial property insurance plans. Here is a list of the most common excluded perils:
- Earthquakes, sinkholes, landslides
- Government action or war
As an example, if your commercial property insurance excludes hail and your roof was damaged by hail, your claim will likely be denied. This emphasizes just how important it is to be fully aware of insurance policy exclusions.
5. Secondary Damage Due to Uncovered Perils or From An Uninsurable Roof
Secondary damage caused by a damaged uninsured roof or by an uncovered peril will also not be covered.
Using the previous example, if hail damages your roof enough and a leak from the roof causes interior water damage, this will likely not be covered in your commercial property insurance plan – provided that it has this exclusion.
The same applies if the roof is deemed uninsurable and roof damage leads to interior water damage.
6. The Roof Damage Is Caused By the Property Owner
If the damage to the roof is caused by the property owner’s negligence, it may not be covered in some commercial property insurance plans. A few examples include:
- DIY repairs that lead to further damage.
- Not doing due maintenance to the roof to the point of advanced wear and tear or damage.
7. The Damages Involve Undeclared Recent Additions To The Roof
If you have recently added fixtures to your commercial roof, it would be best to declare these immediately to your insurer. Otherwise, damage relating to undeclared fixtures may not be covered.
8. The Roof Exclusion Is a Voluntary Endorsement In Your Insurance Plan
Sometimes, roofing insurance exclusions are offered to property owners as an endorsement that could lead to “discounts” in their premium. It is important to consider this carefully. Though a roof exclusion will likely lower your premium, it would also mean that this part of your commercial property is open to a number of risks.
Tailor-Fit Commercial Property Insurance That You Can Count On
Here at KASE Insurance, we can tailor-fit your commercial property insurance plan so that you get the full coverage that your business needs. And if your property has a flat roof, we can also offer you a bundle with extensive commercial flat roofing insurance.