Authored by Sara Weathers
Commercial property insurance rates are rising nationwide due to inflation, construction costs, and severe weather. Law firms in leased or multiple offices may feel trapped by these increases, but protecting your office does not have to be expensive.
Here’s how your firm can stay properly insured while keeping costs in check.
1. Understand What Drives Your Premiums
Before cutting coverage, get clarity. Rates are rising because of higher rebuild costs, supply chain delays, and weather-related losses. Your premium is also influenced by:
- Building age and construction type
- Location-specific risks
- Your claims history
- Selected deductibles and coverage limits
Review these factors with your broker to identify what you can influence and take action.
2. Reevaluate Your Office’s Replacement Cost
Assess your property limits to match current rebuild and replacement costs. Avoid underinsuring, as it increases the risk of out-of-pocket costs after a loss, even if it saves on premiums now.
3. Consider Higher Deductibles for Savings
Increasing your deductible is a practical way to manage premiums while maintaining coverage, especially for firms with solid cash reserves or minimal claims.
4. Address Risk Factors to Improve Your Profile
Insurers reward firms that reduce potential losses. Consider:
- Upgrading building security systems
- Installing water-leak detection devices
- Adding surge protection for tech-heavy offices
- Ensuring routine HVAC and electrical maintenance
Take these risk-reducing steps to protect your office and potentially earn premium credits.
5. Don’t Forget Business Interruption Coverage
If a storm, fire, or burst pipe closes your office, the real financial hit is lost income. Even as property rates rise, this coverage remains essential to keep your firm running during a disruption. Review your limits to ensure they reflect current operational costs.
6. Work With a Broker Who Knows Law Firms
Work with a specialized broker to find the best cost-saving coverage options tailored to your firm’s risks.
Rising property insurance rates are a challenge, but not a reason to reduce protection. By reviewing your limits, addressing vulnerabilities, and making strategic adjustments, your law firm can stay fully protected without stretching its budget.
