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Tag Archives: Hardenbergh Insurance Group


Protecting Vacant Real Estate

Protecting Vacant Real Estate

In a time when layoffs and foreclosures are widespread, your firm may be forced to manage vacant real estate. The insurance risks and liabilities associated with owning vacant property can be extensive, and to ensure you are adequately protected, it is important to know these risks. In addition to purchasing comprehensive insurance coverage, there are numerous preventive strategies for maintaining vacant properties to reduce risk and liability.

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Potential Risks of Vacant Real Estate

There are a host of risks and concerns associated with owning vacant real estate. Vacant buildings are an obvious target for theft, trespassing and vandalism. For example, the rising cost of copper has given rise to an increase in the theft of copper pipes from vacant properties. In addition to any loss or property damage that may occur, keep in mind that the owner of a property can be held liable for criminal activities or accidents that take place on the premises.

In addition, vacant properties are susceptible to undetected damages, such as fire, water damage, electrical explosions, wind or hail damage, and mold. A study by the U.S. Fire Administration shows that approximately 30,000 fires occur every year in vacant buildings, costing $900 million annually in direct property damage. Many of these incidents occur in vacant buildings due to small, undetected maintenance issues; someone in an occupied building would have recognized and handled the problem before it caused a larger loss.

In certain facilities, there may also be environmental hazards that the owner needs to consider. Facilities that are used to store chemicals or other pollutants should ensure that such materials are removed or securely stored— the owner may be held liable for any hazardous materials that contaminate groundwater or other nearby natural resources. Also, underground fuel tanks present serious challenges and thus should be frequently and carefully inspected by professionals.

Other Ways to Mitigate Risk with Vacant Real Estate

In addition to extending coverage, there are some simple steps that owners of vacant property can take to limit their risk and liability.

Prevent vandalism: Notify local authorities of vacated properties so they can watch for criminal behavior.

Maintain an “occupied” appearance: mow the lawn, have mail forwarded or picked up regularly and install light timers and/or a security system.

Limit liability: Make sure the property is free from significant hazards (e.g., broken railings or steps, broken windows) that could cause injuries to anyone on the property—this could include police officers, maintenance workers, firefighters or even trespassers.

Avoid damage: Performing regular maintenance on the property can decrease the odds of sustaining damage. Make sure the heating system and chimney are cleaned and inspected regularly. Have the plumbing system winterized to prevent frozen pipes. Periodically inspect roof, insulation, attic, basement, gutters and other areas of the property for any necessary repairs, mold, damage or other problems. Consider installing smoke detectors that are tied to a centrally monitored fire alarm system so the fire department will be notified in the case of an alarm. Remove all access material and combustibles from in and around the building.

Insuring Vacant Residential Properties

Most insurance companies include a clause that the homeowner’s insurance will expire if a home is left vacant for more than 30 or 60 days. This leaves the property owner financially vulnerable for all previously noted risk. However, many insurance companies do offer vacant property insurance, also known as vacant building insurance or vacant dwelling insurance.

Insuring Vacant Commercial Buildings

Vacant commercial buildings are more difficult to insure because they present greater risks, including increased chance of theft, malicious damage and burst pipes. It is important to disclose all relevant facts when seeking insurance, including the reason for the property’s vacancy and a schedule of any work to be done on the property. Because of the increased risks and liability associated with a vacant property, these types of insurance tend to be costly—ranging from one and a half to five times the cost of a property insurance policy. It is important to look beyond the price and consider the suitability and comprehensiveness of the coverage being purchased.

For more information about vacant property insurance and other strategies to help protect your assets and mitigate loss from vacant real estate, contact us today at (856) 489-9100.

vacant-real-estateBrian Blaston
Commercial Lines – Manager
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955
www.hig.net

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Winter Weather Liabilities

Winter Weather LiabilitiesLet’s explore some winter weather liabilities. The winter months bring more than just cold weather and shorter days; they bring the possibility for winter weather and storms that may result in a snow and ice-covered landscape. While it may be a winter wonderland for some, as a property manager, snow and ice buildup means a hazard with the potential for costly liability.

If you deal with either commercial or residential property, you are responsible for the side effects of winter. In legal terms, snow and ice are the same as any other hazard presented on a property, and just like any other hazard, property managers can be held liable if they cause injury. To avoid litigation resulting from winter injuries, it is important that you are vigilant in your snow and ice removal efforts.

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RECOGNIZING AND PREVENTING HAZARDS

Winter brings a variety of hazards that you need to prepare for; slips and falls are by far the most common injury associated with winter weather conditions. Diligent snow and ice removal can go far in keeping walkways and parking lots safe. Remove snow quickly after snowfalls, and salt regularly to keep ice from building up.

Not all winter hazards are under foot, however, icicles, along with other accumulations of frozen or heavy snow above walkways and building entrances, can cause serious injury if they fall on those below. Remove icicles and other buildup as soon as possible. If it still appears to present a hazard, consider rerouting foot traffic around the area.

Performing preventative maintenance in the summer and fall can also keep you prepared for winter storms. Make sure eaves are properly installed, and check that downspouts are aimed away from walkways. If eaves leak or downspouts direct water onto walkways, snow that melts in the heat of the day has the potential to freeze and create a hazard with cooler nighttime temperatures.

TRANSFERRING RESPONSIBILITIES TO TENANTS

For smaller residential rentals, such as single family homes or duplexes, the responsibility for snow and ice removal is commonly accepted by the
tenant. To make sure responsibility is clearly established in this situation, the lease should include a provision citing the tenants as responsible
for any snow and ice removal. This section of the lease should also establish how long after a snowfall the tenant has to clear public areas
such as sidewalks, as most municipalities have laws requiring prompt snow removal. It is important to be as specific as possible to avoid any
unnecessary liability or disputes after heavy storms.

CONTRACTING SNOW REMOVAL

Based on the size and number of properties you manage and the average snowfall in your area, you may be inclined to contract out snow removal to an independent company. While this can save you the time and costs associated with managing snow removal yourself, it is important that you choose wisely to avoid complicating matters.

First, make sure the contractor has sufficient resources to meet your demands. It is important that they can be onsite quickly after, or even during, a snowfall to make sure walkways and parking areas are cleared. It is also important that they have the equipment and manpower to finish the task quickly to reduce any disruption to tenants’ lives or businesses.

Second, make sure the company you hire carries the proper insurance, covering both its operations and its employees. The last thing you want is to end up being liable for a worker’s injury when liability for injury is the very thing you were trying to avoid. Also, much like the lease agreement with a residential tenant, it is important to specify the conditions and time constraints for removal in writing. When contracting any type of service, it is
essential to have a written contract that will guarantee you receive the services you pay for.

It should be noted that hiring a removal service does not absolve you of liability. If the company you hire provides poor service, or simple does not show up at all, you are still the party responsible for any injury resulting from a winter hazard. Make sure to pick a reputable company that you can trust to do a good job, and always have a plan of action for removal if they are unable to complete the work as quickly or effectively as you require.

For additional questions on your risks and exposures, or on appropriate coverages to protect you from liability or costly disputes, contact Hardenbergh Insurance Group today.

For more information, contact:

winter-weather-liabilitiesBrian Blaston
Commercial Lines – Manager
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955
www.hig.net

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Wire Fraud in Commercial Real Estate

Wire Fraud in Commercial Real EstateLet’s examine Wire Fraud in Commercial Real Estate and how you can avoid it. No industry is exempt from cyber crime, and the commercial real estate industry has become a common target. As hackers devise plans to obtain sensitive information about commercial real estate transactions, real estate professionals need to take particular interest in cyber security to protect their clients and themselves from wire fraud.

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Wire Fraud in Commercial Real Estate: WHAT IS IT?

In instances of wire fraud in commercial real estate, a common ploy involves hackers breaking into a real estate agent’s email account to obtain details about upcoming transactions. Once the hackers have all the information they need, they send an email to the buyer, pretending to be the agent or a representative of the title company.

In an email to the buyer, the hackers state that there has been a change in the closing instructions and that the buyer needs to follow new wire instructions listed in the email. If a buyer falls victim to the scam and wires money to the fraudulent account, they’re unlikely to see the money again.

Wire Fraud in Commercial Real Estate: RED FLAGS

A potential indicator of wire fraud in commercial real estate is an email that makes any reference to a Society for Worldwide Interbank Financial Telecommunication (SWIFT) wire transfer, which is sent via the SWIFT international payment network and indicates an overseas destination for the funds. However, since the emails tend to include detailed information pertaining to the transaction—due to the perpetrator having access to the agent’s email account—many people make the mistake of assuming the email is from a legitimate source. The email addresses often appear to be legitimate, either because the hacker has managed to create a fake email account using the name of the real estate company or because they’ve hacked the agent’s actual email account.

Wire Fraud in Commercial Real Estate: HOW TO AVOID IT

Wire fraud is one of many types of online fraud targeting commercial real estate professionals and their clients. To prevent cyber crime from occurring, every party involved in a real estate transaction needs to implement and follow a series of security measures that include the following:

• Never send wire transfer information, or any type of sensitive information, via email. This includes all types of financial information, not just wire instructions.

• If you’re a real estate professional, inform clients about your email and communication practices, and explain that you will never expect them to send sensitive information via email.

• If wiring funds, first contact the recipient using a verified phone number to confirm that the wiring information is accurate. The phone number should be obtained by a reliable source—email is not one of them.

• If email is the only method available for sending information about a transaction, make sure it is encrypted.

• Delete old emails regularly, as they may reveal information that hackers can use.

• Change usernames and passwords on a regular basis, and make sure that they’re difficult to guess.

• Make sure anti-virus technology is up to date, and that firewalls are installed and working.

• Never open suspicious emails. If the email has already been opened, never click on any links in the email, open any attachments or reply to the email. IF YOU’VE BEEN HACKED

Take the following steps if you suspect that your email, or any type of account, has been hacked:

• Immediately change all usernames and passwords associated with any account that may have been compromised.

• Contact anyone who may have been exposed to the attack so they too can change their usernames and passwords. Remind them to avoid complying with any requests for financial information that come from an unverified source.

• Report fraudulent activity to the FBI via the Internet Crime Complaint Center at www.ic3.gov/default.aspx. Also contact the state or local realtor association, which will alert others to the suspicious activity.  Contact Hardenbergh Insurance Group today for more information on avoiding real estate fraud and other types of cyber crime.

For More Information about how you can prevent Wire Fraud in Commercial Real Estate, please contact:

Brian Blaston, Partner
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955
www.hig.net

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Tenant Improvements and Betterments

Tenant Improvements and BettermentsLet’s explore how Tenant Improvements and Betterments impact insurance. Suppose that a landlord leases a storefront to a retailer that makes improvements to the facility by adding features to help sell its products. During the lease, a fire breaks out and damages the building, including the features added by the retailer to improve the space. When the insurance claims are made, the following questions arise:

• Who did the improvements belong to?
• Who is responsible for paying the damages?

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Defining Tenant Improvements and Betterments

While legal definitions vary, improvements and betterments are anything that a tenant attaches to the landlord’s real estate that becomes a permanent part of that real estate. Under most leases, such improvements become the property of the landlord and tenants are responsible for repairing or replacing the improvements in the event of loss. However, property policies can be customized to determine whether tenants’ improvements and betterments are covered under the building category or under the contents category.

A Landlord’s View of Tenant Improvements

When a tenant makes substantial improvements and betterments to a building, it adds to the building’s value. In order to realize this added value, the landlord needs to clearly establish who is responsible for damages to that property to avoid insurance complications. In doing so, the landlord typically has to make one of the following decisions:

1. Increase the limits of the property insurance policy to account for this extra value.

2. Add a clause to the rental contract stating that the tenant is responsible for damages to improvements and betterments.

In the absence of one of the aforementioned decisions, the landlord may face penalties in the event that he or she has to make an insurance claim. For example, if a tenant makes $100,000 worth of improvements and betterments to a property that was initially worth $500,000, and a fire destroys the entire building, the insurance adjuster will value the property at $600,000 when processing the claim. But, since most landlords’ property policies consider improvements and betterments as covered property, the landlord may be charged an underinsured penalty if the building’s policy hasn’t been increased to reflect the amount of the improvements
and betterments.

A landlord who does not wish to insure for the values of the improvements and betterments should specifically exclude them.

A Tenant’s View of Tenant Improvements

If the lease requires the landlord to repair or replace tenants’ improvements and betterments that become damaged, the tenant does not need to insure them. In contrast, if the lease does not require the landlord to repair or replace tenants’ improvements and betterments, tenants need to make sure they are covered under their own property policy.

 

Tenant Improvements – Considerations When Entering a Lease

When entering into a new lease or renewal, it is critical for both landlords and tenants to carefully review the terms of the lease to ensure that it adequately delegates the responsibility for insuring tenant improvements and betterments. It is also important to make sure that each party’s insurance policy is adequate enough to properly protect the scope of the tenant improvements agreed upon in the lease. When reviewing the lease, both the landlords and tenants should discuss the following questions:

• Who owns the improvements?
• Who is responsible to replace the improvements if damaged?
• Which insurance policy covers the improvements—the landlord’s or the tenant’s?
• Is the policy adequate?

Insuring Tenant Improvements and Betterments

Tenant Improvements and betterments are not difficult to insure, as a building’s insurance forms automatically cover them. However, many landlords expect their tenants to insure any improvements and betterments that are
made, and some landlords refuse to increase the value of their building policies to reflect the new value of such changes. Therefore, it is important to understand the insurance ramifications of tenants’ improvements and betterments. Hardenbergh Insurance Group can help you identify your exposures and make appropriate recommendations.

For more information on Tenant Improvements and Betterments

Brian Blaston, Partner
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955
email: brianb@hig.net
www.hig.net

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Respecting Privacy During CCTV Monitoring

Respecting Privacy During CCTV Monitoring

Respecting Privacy During CCTV Monitoring

Let’s look at ways to respect privacy during CCTV monitoring. Whether you’re managing a commercial or residential property, there will always be concerns about safety and security. While certain responsibilities may fall on your tenants, there is a good chance that there will be areas, such as parking lots, lobbies and similar public spaces, for which you will be responsible. For these situations, you may choose a closed circuit television (CCTV) system not only to catch crimes as they occur, but also to deter them from ever being attempted. However, if you use CCTV equipment, it is extremely important where you choose to install it, as ill-advised camera placement can potentially lead to costly invasion of privacy suits by your tenants or their guests.

Download: Respecting Privacy During CCTV Monitoring (pdf)

Expectation of Privacy During CCTV Monitoring

CCTV cameras are legal to use in public areas because they are just that—public areas. When an individual is in a public area where they can be clearly observed by those around them, they cannot have a reasonable expectation of privacy. However, in areas deemed to be personal spaces, individuals do have a right to expect a certain amount of privacy. Most commonly, private spaces are places like a person’s home or a rented hotel room in which, by law, an individual can expect a certain protection from unwanted intrusions. Since people can expect privacy in their own homes, where you position cameras is extremely important
when dealing with residential properties. This means that cameras should never be installed in living spaces; it also means that cameras installed in public spaces should not be able to monitor events going on inside a person’s residence. For example, this means that a camera placed in a parking lot should not be aimed into a tenant’s window. Even if the window is open, the tenant still has a reasonable expectation of privacy in their own home.

Problems can also arise at commercial properties when it comes to CCTV placement in private spaces that exist in public settings. Any use of CCTV equipment in a tenants’ rented space should be discussed with them during the leasing process. Even though they may be operating a public venture in the space, they still are entitled to a certain amount of privacy. Also, if you provide public restrooms at a facility, those who use them have a reasonable expectation of privacy, so cameras
should not be placed in these areas.

Notify Tenants During CCTV Monitoring

A good way to protect yourself from invasion of privacy claims is to establish procedures that lower the expected amount of privacy. Post signs notifying the use of security cameras on the premises. Many privacy cases involve a discrepancy between the amount of privacy an individual believes they were entitled to and how much they were actually provided with. Proper notification can make it clear as to what expectations they can have for their privacy upon entering an establishment.

Also make sure you notify tenants of the extent of your CCTV monitoring before they sign the lease. Accurately disclosing this information upfront reduces the risk of liability. Since they entered into the lease with a full understanding of the extent of your CCTV use, it will be harder for them to raise objection to it at a later date.

Create a Policy Detailing Rights to Privacy During CCTV Monitoring

Establishing a CCTV policy can also help. The policy should outline the provisions for camera placement and proper camera use. By instituting a policy for CCTV use, camera operators will know what practices are acceptable and which could increase the risk for litigation.

Learn More About Respecting Privacy During CCTV Monitoring

 

Brian Blaston
Partner
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955
www.hig.net

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Air Quality Management for Commercial Buildings

Air Quality Management for Commercial Buildings

Air Quality Management for Commercial Buildings

Let’s look at air quality management for commercial buildings. The health of your property’s occupants can be jeopardized by poor air quality, and it is your responsibility to provide a healthy indoor environment, whether it is protecting against airborne infections like H1N1 or pollutants from equipment. From mechanical problems like a faulty exhaust fan to the measure of air volume exchanges, there are many factors that are easily overlooked. An Indoor Air Quality Management Plan is a good way to ensure that residents’ health is not endangered by the air in the building.

The plan you design must address the specific needs of each space, and should never be limited to HVAC maintenance. The task should be assigned to one person who is charged with identifying problem locations and staff whose activities might affect the quality of the air.

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Air Quality Management Practices

(1) STUDY THE EXCHANGE RATE

The air volume exchange rate is a factor that property managers must consider. The American Society of Heating, Refrigerating and Air Conditioning Engineers (ASHRAE) recommends a minimum exchange of ten cubic feet per minute per person in an indoor environment. This rate can be tested by a certified engineer. If your rate is too high, you will be alerted to problems like a faulty variable air volume box.

(2) TAKE STEPS TO IMPROVE YOUR AIR QUALITY MANAGEMENT PLAN

Ensure that you will easily be able to update your plan for any legislative or other changes that affect air quality. Follow these guidelines for creating a plan that is appropriate to your situation:

• Consult the Sheet Metal and Air Conditioning Contractors’ National Association (SMACNA) for advice on the maintenance of air quality if you renovate or add on to your property.

• Schedule routine maintenance of motors, fan belts and filters with certified mechanics. Revisit everything every 90 days.

• Specify filter selection and maintenance. If the property has mixed uses, each occupant should have a separate filter schedule:

• Specify which Minimum Efficiency Rating Value (MERV) is necessary in the filter. The higher the number, the higher the filtration rate.

• In sensitive environments, use a high efficiency particulate air (HEPA) filter.

Design procedures for reacting to complaints by occupants, including those regarding humidity or odors. Air quality professionals may be able to analyze air samples to identify appropriate solutions, which might include dehumidifiers or air scrubbers.

• Verify that all cleaning products comply with Environmental Protection Agency (EPA) standards.

(3) WORK WITH OCCUPANTS

Inform your occupants your air quality plan, and ask for their help in maintaining good air quality. There are steps occupants can take to improve air quality, including the following:

• Refraining from smoking within 25 feet of the building

• Using entryway cleaning systems, such as grills and mats, to reduce the amount of dirt, dust and pollen that enters the building

• In sensitive environments, using ultra-violet lights to kill bacteria circulating in the air

CONTACT US

For more air quality management and loss prevention tips, contact Hardenbergh Insurance Group. Our insurance specialists are available to help you solve your property and casualty issues.

Brian Blaston, Partner
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955

www.hig.net

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Protect Your Property Against Attractive Nuisance Dangers

attractive-nuisance-dangersThe following article explores how to protect your property against attractive nuisance dangers. Although property owners are generally not responsible for protecting trespassers, in some cases, landowners or those who occupy land under leases can be held responsible for injuries to children that are caused by man-made conditions on the property. Considered attractive nuisances, these might include buildings, construction sites, heavy equipment or even man-made ditches.

Property owners have the power to thwart entrance onto their property and discourage young trespassers from getting hurt. One might use fencing, illustrated signs or other means to prevent children from entering the property and potentially injuring themselves. If you have any reason to believe that children might trespass onto your property or in your facility, treat the problem with the highest gravity. Doing nothing to prevent the entry or injury of trespassers creates a serious financial risk for your company.

Owner Liability in attractive nuisance dangers

As the owner of the property, you are responsible for taking steps to assure that anyone who enters, whether welcome or unwelcome, stays safe from injury. While warning signs are an excellent start, many children may not be able to read them, so it is important to find additional ways of protecting your property.

Ensure that gates are secured and fences are not easily climbed. Adequately protect any conditions,
including pools, ditches, walls or other man-made physical features, that might present a hazard. This may mean covering the pool to avoid accidental drowning, placing sturdy fencing around hazardous areas or placing warning or “No Trespassing” signs. In addition, all safety equipment should be stored and locked at the end of each shift to avoid trespasser tampering.

Premise Liability in attractive nuisance dangers

Property owners are also liable for the maintenance and security that the property needs so that it remains safe for all visitors. This includes the following:

• Fixing cracks or gaps in walkways to avoid slip and fall dangers
• Locking all hazardous tools, equipment and chemicals away from the public
• Ensuring that employees can conduct work duties without the risk of injury
• Hanging flood lights in areas with low visibility
• Hiring security guards for added protection
• Installing rescue equipment, such as ropes and poles, when necessary
• Installing alert devices, such as flashing lights, sirens, alarms and telephones to alert security that
someone has trespassed onto the premises

With regard to attractive nuisance cases, negligence means that the property owner was aware that someone could get hurt on the property and did nothing to prevent it. If you take all necessary precautions to protect individuals that are on your property, you are less likely to be found negligent in a premise liability suit.

For more assistance in protecting your property and your business, contact Hardenbergh Insurance Group today.

brian-blaston-hardenbergBrian Blaston
Commercial Lines – Manager
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955
www.hig.net

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Additional Coverage for Green Buildings Owners & Tenants

coverage for green buildingsLet’s explore insurance coverages for green buildings. So, you’ve decided to go green by buying or renting a LEED-certified building for your business. In addition to a reputational boost for taking strides to help the environment, you will likely also be saving on heating and electricity costs. The next step is to look at your insurance policies and make sure your investment is protected, and that you are covered for the perils associated with green properties and buildings.

Because going green is a still a relatively new phenomenon, your commercial general liability (CGL) policy probably does not specifically address these risks or indicate whether or not they are covered. It is always best to take a close look at your policy to determine if your plans to go green cause any changes. Learn about additional coverage options for green buyers or renters here.

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Upgrading to green buildings

Maybe you want to go green but are not ready or able to fully convert yet. One option that is becoming more common is green upgrade property coverages. These policy additions would allow you to upgrade to a green-certified level in the event of a physical property loss. Update-to-green coverage benefits you because your building has the potential to be even more efficient after a loss, and it puts you at a lower risk of filing construction defect claims in the future because of the rigorous and careful LEED certification process.

Breach of Warrantee/Breach of Contract for Green Buildings

Though a typical CGL policy will cover you for bodily injury, property damage liability and personal injury, breach of warranty and breach of contract are generally excluded. However, when you are a tenant in or an owner of a green-certified building, these are two or the most important kinds of coverages to have. One of the most common claims against property owners or managers is that after construction or years down the road, the green building is not living up to promised standards. The building may not qualify for the LEED certification level promised, or savings on energy may not be as high as marketing and advertising materials guaranteed. You will need additional coverage beyond your CGL policy to protect yourself in this case.

Similarly, problems with tax credits and incentives will require breach of warrantee or breach of contract coverage. If a developer or owner tells you, the prospective buyer or tenant, that they will be able to get a certain number of carbon credits and later cannot deliver, you will need proper coverage to retain the promised return on investment. The amount of necessary coverage will depend on how energy efficient the building is or strives to be. 

Coverage for Non-Performance Investigations of green buildings

If a problem ever arises with your green buildings, you will need to find out who is at fault—the design professional, developer, owner or contractor. Doing so will require extensive testing of the building and its systems to figure out why it is performing under the promised standard. As CGL policies are crafted now, the cost of this investigation may not be covered. CGL policies usually require an occurrence or event—a specific incident where damages happened—to respond. In most green buildings cases, there is no damage to the structure, it just does not perform as efficiently or effectively as the contract specifies.

Therefore, you should consider adding extra protection to your policy that would pay for the cost of finding the at-fault party, which can get extremely expensive if it requires looking into design and construction elements.

New coverages emerging for green buildings

Green buildings are still making their way into the insurance world. There are still grey areas, and insurers are debating whether green buildings add extra perils or reduce risks overall. Some carriers are even beginning to offer discounts for those businesses who decide to become more environmentally responsible. When in doubt about what aspects of your investment  in green buildings are covered, turn to Hardenbergh Insurance Group for guidance. Call (856) 489-9100 today to make us part of your initiative to go green.

Brian Blaston, Partner
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955
web: www.hig.net

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Commercial Fire-Suppression & Commercial Sprinkler Systems

Retrofitting your property with fire-suppression commercial sprinkler systems—or demanding their addition into your newly built property—might add expenses today but may help your firm achieve significant cost-savings in the long term. Having an up-to-date, effective and well-maintained sprinkler system will help you achieve significantly lower property insurance premiums, reduce losses in the event of a fire, and get your business up and running quicker post-loss. Consider adding sprinkler systems to protect your property—and your bottom line.

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Commercial Sprinkler Systems Basics

commercial sprinkler systems

commercial sprinkler systems

Fire-suppression commercial sprinkler systems are used to control or extinguish fires in the early stages. They help to mitigate the hazards for both building occupants and firefighters by spraying water directly on a fire source as soon as the sensor indicates a certain temperature has been reached. These systems could greatly decrease your losses in the case of a fire.

While many types of commercial sprinkler systems exist, wet pipe and dry pipe are the most common. Wet-pipe sprinkler systems are constantly filled with water, and are triggered when the ambient air temperature reaches a certain degree threshold. Most commercial sprinkler systems in use today are wet-pipe systems.

If your facility has special considerations, it might be important to explore a dry-pipe system. Dry-pipe commercial sprinkler systems are filled with air until activated, at which point the surrounding pressure changes, allowing water to flow through the pipes. Dry-pipe sprinkler systems are used in areas that are susceptible to freezing temperatures, or contain expensive equipment that should not be near water. Even less common systems include deluge, pre-action, foam water and water spray. Do some research to find out which type will best serve your business.

Benefits of Commercial Sprinkler Systems

In considering the installation of commercial sprinkler systems, you are likely concerned about the cost. In reality, however, the cost to you would be much greater if a fire occurs and there are no sprinkler systems present. Sprinkler systems can save you money in many different ways, meaning that in the long run they pay for themselves.

The installation of a commercial sprinkler system in your building is a smart financial decision. It lowers the risk associated with the building, resulting in lower insurance premiums. It can also qualify a building for certain income tax reductions that it would not otherwise qualify for. For example, some of the income tax reductions your building could qualify for are depreciation allowance, interest on a loan and Qualified Rehabilitation Tax Credit. The latter is applicable to noncommercial buildings built prior to 1936 or designated as historical structures. While the installation of commercial sprinkler systems alone doesn’t qualify for a Qualified Rehabilitation Tax Credit, the expenses qualify for the credit as part of a renovation.

Liability is another reason for installing commercial sprinkler systems in your building. Research has shown that the public considers sprinkler systems a “reasonable level of care,” resulting in building owners having to pay out over $1 million per life lost in the event of a fire where a sprinkler system was not present.

Not only do commercial sprinkler systems save you money in the event of a fire—they are also an easy way to ensure that related building codes and laws are being adhered to. In order to be in compliance with the Life Safety Code, all high-rise apartments and office buildings must have either a full, operational sprinkler system or an engineered life safety system.

One big difference between the two is that the engineered life safety system does not pay for itself in the long run. Certain federal legislation applies to this subject as well, such as the Hotel and Motel Fire Safety Act of 1990 and the Americans with Disabilities Act. Keeping yourself in compliance with codes and laws surrounding sprinkler systems will save you potential headaches later on.

An equally important consideration in installing a commercial sprinkler system is tied to business interruption; a majority of companies that have fires never reopen their doors. With sprinkler systems installed, the chance of a fire interrupting business is minimized—commercial sprinkler systems can contain fires in small areas, decreasing the amount of damage and making it possible to more quickly reopen buildings and operations.

Because fires are a relatively common occurrence, it is important to protect yourself and your investments from damage. In addition to the benefits noted above, as a result of installing sprinkler systems in your properties you will also have peace of mind that your properties are safe and well-protected.

brian-blaston-hardenbergBrian Blaston
Commercial Lines – Manager
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955

www.hig.net

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Shutting Off Utilities During a Disaster

Shutting Off Utilities During a DisasterShutting off utilities during a disaster is important when utilities have been disrupted. There may be a need to turn off certain utilities in order to control additional damage from the disaster. This usually involves turning off one or more of the following: natural gas, water and electricity. Emergency service providers and utility employees will be overwhelmed following the disaster, so it’s important that your family and your neighbors know how and where to control the utilities. Pre-planning and fast actions can save both lives and property.

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Shutting Off Natural Gas Utilities During a Disaster

• Natural gas leaks and explosions are responsible for a significant number of fires during and after disasters. It is vital that all household members know how to shut off natural gas. Gas meters can usually be found on the side of the house.
• Because there are different gas shut-off procedures for different gas meter configurations, it is important to contact your local gas company for any guidance on preparations and response regarding gas appliances and gas service to your home.
• When you learn the proper shut-off procedure for your meter, share the information with everyone in your household. Be sure not to actually turn off the gas when practicing the proper gas shut-off procedures.
• If you smell gas or hear a blowing or hissing noise, open a window and get everyone out quickly. Turn off the gas, using the outside main valve, if you can, and call the gas company from a neighbor’s home.
• Caution: If you turn off the gas for any reason, a qualified professional must turn it back on. NEVER attempt to turn the gas back on yourself.

Shutting Off Water Utilities During a Disaster

• Water quickly becomes a precious resource in a disaster situation. It is crucial that all household members learn how to shut off the water at the main house valve.
• Before an emergency happens, locate the shut-off valve for the water line that enters your house and label this valve for easy identification. Make sure all household members know where it is located. You should also make sure the valve can be completely shut off. It may be rusted open or it may only partially close. If so, replace it.
• Cracked lines may pollute the water supply to your house. It is wise to shut off your water until you hear from authorities that it is safe for drinking.
• The water in your hot water heater and toilet tanks may drain due to gravity unless you trap it in your house by shutting off the main house valve. (This is not the street valve in the cement box at the curb; the street valve is extremely difficult to turn and requires a special tool.)

Shutting Off Electrical Utilities During a Disaster

• Electrical sparks could ignite natural gas if it is leaking, and they could also cause other flammable materials to catch fire. It is wise to teach all household members how to shut off the electricity.
• Locate your electrical circuit box. For your safety, always shut off all the individual circuits before shutting off the main circuit. If your house has fuses instead of circuit breakers, keep extra fuses on hand in case one blows during an emergency. Never replace a fuse with one of higher amperage.
• Finally, make sure your circuit breaker or fuse box is properly labeled so you know exactly what switches cut power to which areas of the house.
In addition to insuring your home, Hardenbergh Insurance Group is committed to helping you and your loved ones stay safe when disaster strikes. If you would like more information on developing a family emergency plan or building a disaster supply kit, please contact us at (856) 489-9100 or http://www.hig.net today.

Shutting Off Utilities During a DisasterBrian Blaston
Commercial Lines – Manager
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955
email: brianb@hig.net

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Workplace Fire Evacuation Tips

Being prepared for a fire evacuation emergency is not something that should only concern you at home—you should also be prepared to evacuate while at work. To be ready for a fire evacuation and to stay safe remember the following:

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Fire Evacuation Preparation


Use the following to tips to prepare yourself for a potential fire evacuation:

fire evacuation• Familiarize yourself with your worksite’s emergency fire evacuation plan.
• Know the pathway to at least two exits from every room or area at work.
• Recognize the sound or signaling method of the fire and evacuation alarms.
• Know who to contact in an emergency and how to contact them.
• Know how many desks or cubicles are between your workstation and nearest exits so you can escape in the dark, if necessary.
• Know where the fire evacuation alarms are located and how to use them.
• Report any damaged or malfunctioning safety systems and backup systems.

Evacuating Safely

In order to evacuate the workplace safely, following the tips below:
• Leave the area quickly but orderly, following the worksite’s emergency evacuation plan.
• Go directly to the nearest fire- and smoke-free stairwell, recognizing that in some circumstances the only available exit route may contain smoke or fire.
• Listen carefully for instructions over the building’s public address system.
• Crawl low, under the smoke, to breathe cleaner air.
• Test doors for heat before opening them by placing the back of your hand against the door to avoid burning your palm and fingers.
• Do not open a hot door; find another exit route. If the door feels cool, brace yourself against it and open it slowly.
• Keep designated fire doors closed to slow the spread of smoke and fire.
• Do not use elevators when evacuating a burning building.
• Report to the meeting place designated in the emergency evacuation plan.
• Do not reenter the building unless directed by authorities.

What to Do if You are Trapped

In the case of a fire, following the strategies below can you help you stay safe:
• Stay calm and take steps to protect yourself.
• Go to a room with an outside window and call for help, if possible.
• Stay where rescuers can see you and wave a light-colored cloth to attract attention.
• Open windows if possible, but be ready to shut them if smoke rushes in.
• Stuff clothing, towels or papers around the cracks in doors to prevent smoke from entering the room

brian-blaston-higBrian Blaston
Commercial Lines – Manager
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955
www.hig.net

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Do You Have Business Interruption Insurance?

Business Interruption InsuranceAre your business operations covered with business interruption insurance? If a fire causes your business facility to be temporarily unusable, what would you do next? Ideally, you would move to a temporary location while your permanent place of business is being repaired. Yet, traditional Property Insurance does not cover this move or a loss of income when a business must temporarily close.

With Business Interruption Insurance, also referred to as Business Income coverage, this setback can be
minimized by simply adding this coverage to your Property Insurance policy.

What is Included in a Business Interruption Insurance Policy?

The Following is Covered Under a Business Interruption Policy:

• Compensation for lost income if your business has to vacate its premises as a result of disasterrelated damage covered under a Property Insurance policy.

• Covers the profits that would have been earned based on previous financial records, had the disaster not occurred.

• Covers operating expenses, such as utilities, that must be paid even though business temporarily ceased.

• Covers expenses of operating in a temporary location while repairs to the permanent location are completed.

Considerations for Business Interruption Insurance

Here are some things to think about if you’re considering Business Interruption Insurance:

• Business Interruption Insurance cannot be purchased on its own; it must be added to a Property Insurance policy or included in a Business Owner’s Insurance policy.

• Policy limits should be sufficient enough to cover a large amount of time to rebuild the permanent business space. Generally the business must be closed for several days before coverage begins, and it does not pay for those days retroactively.

• Price of coverage depends on the risk of disaster to the premises. This may depend on the business location, nature of the business and how easily the business could function at an alternate location on a temporary basis.

What Is Extra Expense Insurance?

Extra Expense Insurance is also a viable inclusion to cover the amount needed to avoid having to shut down a business while the permanent location is being repaired. This coverage reimburses for expenses that arise on top of normal business expenses, but are not covered by Business Interruption Insurance. Depending on the disaster, Extra Expense Insurance may be sufficient enough to provide financial relief without having to utilize Business Interruption Insurance.

Insurance experts estimate that Business Interruption Insurance is one of the most, if not the most, valuable coverage available, yet business owners often overlook it. Since Property Insurance only covers the cost of physical loss or damage and contents of a business in the event of a disaster, Business Interruption coverage is invaluable in covering the loss of income while the permanent business location is being repaired. Consult Hardenbergh Insurance Group today to learn about all of our business continuity resources.

For more assistance in protecting your property and your business, contact Hardenbergh Insurance Group today.

brian-blaston-hardenbergBrian Blaston
Commercial Lines – Manager
Hardenbergh Insurance Group
phone: 856.489.9100 x 139
fax: 856.673.5955
www.hig.net

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