Keeping Insurance Values Up-To-Date

April 27, 2014

Keeping Insurance Values Up-To-Date

We’d like to take a few minutes to discuss the importance of protecting your business and employees by keeping your insurance coverage up-to-date.

A Quick Insurance Review

Let’s start with some basics about how insurance works. Insurance protects people and companies against major financial losses that occur because of damage or loss of property. Insurance companies determine premiums by taking into account the risks associated with the business, the amount of coverage they need to be fully protected, their past history and statistics that predict what percentage of businesses will suffer a loss or file a claim. The amount of property insurance coverage is based on the cost to rebuild and restore your business, not market value.

The Rising Cost of Rebuilding

In recent years, we’ve experienced devastating weather events at home and worldwide. In 2011 alone, the U.S. experienced $17.3 billion in insured losses from 100 significant events, many unprecedented and unexpected. Some decimated entire communities. And, experts predict that severe weather will likely continue.

Add to that, skyrocketing building costs. As communities here and abroad rebuild, the demand for building materials and labor has intensified, driving up prices. For example, in the fifteen months between the second quarter 2010 and third quarter 2011 the follow materials increased significantly:

  • Copper Pipe +26.5%
  • Drywall +5.5%
  • Steel Rebar +15.8%
  • Plywood +11.0%
  • Structural Steel +13.0%
  • Lumber +11.7%


Insurance-to-value is a critical element of any well-constructed property insurance program. If you and your agent or broker keep values up-to-date, this can protect your business by providing you with the coverage you need should a major loss occur.

Travelers has easy to use tools that will help you and your agent or broker address this issue. For more information about our Insurance-to-Value and Business Income worksheets talk to your agent or broker.

The Travelers Indemnity Company and its property casualty affiliates One Tower Square Hartford, CT 06183
This material does not amend, or otherwise affect, the provisions of coverage of any insurance policy or bond issued by Travelers. It is not a representation that coverage does or does not exist for any particular claim or loss under any such policy or bond. Coverage depends on the facts and circumstances involved in the claim or loss, all applicable policy or bond provisions, and any applicable law. Availability of coverage referenced in this document can depend on underwriting qualifications and state regulations.
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