b'DAYTODAYINSURANCE SOLUTIONSJon Barron and James DickOld Building Insurance ProblemsCoverage concerns to consider before you buyM ember ministries do an amazing job of3. Vacancy rules: Insurance policies usually repurposing old buildings for ministryrequire at least one-third of the space to be use, though challenges abound. Inactively used. Vacancies can lead to the need for addition to the typical issues of zoning, NIMBYism,separate, higher-cost insurance policies.and finding the right partners, the challenge of4. Construction challenges: The ministrys insuring these buildings has never been more diffi- main insurance policy excludes coverage during cult or expensive. The U.S. propertyconstruction, which can become complex, espe-insurance marketplace is undercially when it affects normal operations. Discuss immense pressure due to record losseswith the insurer beforehand any project that will over the past five years. Reinsurers arecost more than $100,000 or requires the location pushing double-digit increases onto be closed.insurers to rebuild their cash reserves5. Environmental concerns: Thorough due dili- costs that are passed along to yourgence with the appropriate professional is essential organization when purchasing insur- for any potential environmental liabilities.ance. Fortunately, the Citygate Network6. Building condition: Even if you plan a full Insurance Program has sustainedgut and rehab, the age and current condition lower-than-average losses for moreof the building systems influence available rate than 20 years, resulting in more favor- and coverage. able rates when compared to insurance7. Location: Properties in high-risk areas, rates for other similar organizations. including wildfire- and storm-prone zones, take When your ministry is considering addinga higher rate. Proximity to fire hydrants and a new old building to your portfolio, here arethe fire department also affects your rate.issues we recommend researching before8. Prior claims history: Understanding the buying/accepting. propertys history of claims can help address 1. Electrical safety: Outdated breaker panelsfuture issues. like Stab-Lok and Zinsco can hinder affordable9. Building design: Some building designs, like insurability due to a high risk of fires. The same isold motels, raise insurability concerns among insur-true for old wiring, specifically knob and tube orers. Centralized entrances and gathering spots may Jon and James serve as nationalaluminum wiring configurations. Electricians mayadd value and reduce insurability challenges. directors of the Citygate Network Endorsed Insurance Program,vouch for their safety, but insurers often shy awayYour insurance partner should be able to give administered by our contractdue to a track record of over 2,000 fire incidentsinsight to help you navigate these building insura-partner, Gallagher. More informa annually related to the breaker panels alone.bility challenges effectively and help you formulate tion is available for members2. Lack of sprinklers: Residential spaces abovea plan to mitigate risks. Your proactive attention through the Insurance Section of Citygate Networks Contractthe second floor without a building-wide sprinklercan make the difference in securing a quality insur-Partners web page, www.citygatesystem pose a significant insurability challenge.ance program that saves thousands of dollars. \x03network.org/insurance.54 WWW.CITYGATENETWORK.ORG JANUARY/FEBRUARY 2024'