Tel: 619-259-5459
Competitive Edge Insurance
  • Construction
  • Business
    • Health and Wellness Insurance
    • Cyber Liability
    • Bonding
    • General Business Insurance
    • EIDL Insurance Requirements
  • Personal Lines
    • Auto Insurance
    • Boat Insurance
    • Homeowners Insurance
  • About Us
  • Resources
    • Articles and Insights
    • Trusted Advisors
  • Contact
  • Menu Menu
  • LinkedIn
  • Instagram
  • Facebook
  • Youtube
City view of commercial buildings, including skyscrapers surrounded by trees

How to COPE in an Inflationary Environment

in General Business Insurance, News, Video

Recently, Hartford did a study that showed that 75% of all commercial buildings were underinsured. And of those that were underinsured, they’re at 40% underinsured. That means that if you have a property that’s worth a million dollars, you’re only having it insured for 600,000.

If you have a catastrophe, you’re only going to get paid the 600,000 for the rebuild costs now, and not the million dollars that it’s going to cost to make you whole again. What’s really important for commercial building owners is to understand how the insurance carriers rate your properties and it’s called COPE, C-O-P-E: construction, occupancy, protection, and exposure.

In this blog, we’ll discuss COPE and learn more about it directly from the founder of Competitive Edge Insurance, Brenda Jo Robyn.

What is COPE?

As a commercial building owner, it’s important to understand how your property is being rated for insurance purposes. The four main factors that go into this rating are construction, occupancy, protection, and exposure (COPE).

Construction is how your building is built. Things like the roof, walls, windows, and doors all factor into how well your building can withstand a disaster. 

  • What is the building made of? 
  • What is the age of the building? 

All commercial buildings are going to be rated on a scale of 1 to 10, with 1 being the best. So if you have a fire resistant building, that would be a 1. If you had a wood frame building, that would be a 10. 

Occupancy is what your building is used for. If you have a lot of people coming in and out of your building, or if you have hazardous materials inside, that will affect your rates.

  • Who’s in it? 
  • Is it manufacturing? Is it retail? 

So if you have a retail store, that would be a low hazard. If you had a chemical plant, that would be a high hazard. 

Protection is what you do to protect your building. Things like security systems, sprinklers, and alarm systems can help lower your rates.

  • What are the protections you have there? 
  • How far away is the fire department? 
  • Do you have a fire hydrant on your block? 

So if you have automatic sprinklers, that’s going to give you a better fire rating. 

Exposure is how likely your building is to be damaged in a disaster. If you’re in a high-risk area for hurricanes or tornadoes, your rates will be higher than if you’re in a low-risk area.

  • What is around your building? Fire brush, lakes, potentials for flood? 
  • What is the neighborhood like? Is it in a crime area? 

If you’re on a busy street, that’s going to be a high exposure. If you’re in the middle of a field, that’s going to be a low exposure.

All these factors are what carriers take a look at. Understanding COPE can help you make sure you’re getting the best possible rate on your commercial property insurance. 

Instability Caused By Inflation

Currently, insurance rates have been increasing and they have also been very unstable for the last year. The instability is being caused by inflation.

Supply Chain Issues

The raw material costs are all over the place. They don’t know how much they’re gonna cost when they get ordered by the contractor. Some can order it a week out and some are being told, “Hey, here’s your bill now, but when it comes in, we’re gonna give you what the real cost is.” Obviously, the sluggish supply chain issues haven’t gone away. 

Demand for Skilled Labor

There’s a high demand for skilled labor. Not only are we having people retire, but we don’t have enough people being apprentices and it’s not being able to translate to more people being able to do a job. 

Lingering COVID Effect

And lastly, the lingering COVID effect. Unfortunately, during COVID, people were placing insurance on buildings that were only looked at over the internet on your desktop. And what they come to find out later is that the building has not been maintained, that there’s storage of plastics in there and there’s no sprinkler system. So this has all led to an increase of rates.

What Can You Do?

And what can you do? In order to be a building owner that’s gonna continue to make money, you have to control your costs. And how do you do that? You have to make a commitment to do so, and you’re gonna do it by controlling your losses. 

Steps to control your costs: 

  • Maintain your buildings 
  • Update the electrical wire, heating, plumbing, roofing 
  • Have good housekeeping 
  • Perform regular safety checks 

What is it that’s been able to be implemented in the last three years so that it protects your office building better now than it was three years ago? All these things will go ahead and poise you into a place where the carrier will look at you favorably and give you more credits. 

When you are able to show the insurance company that you are in a mode of safety, maintenance, and security, carriers will give you rates that you can live with and you won’t have to pass on to your customers. It’s a win-win for everybody.

A Final Word

All of these things go into how the insurance carrier rates your property and what they’re going to charge you for premiums. As a commercial building owner, it’s important for you to understand how your property is being rated so that you can make sure you’re properly insured. If you have any questions about your commercial property insurance coverage, reach out to us today! 


Or if you’re interested in learning more from Brenda Jo, you can check out her other videos including, Why You Need to Audit Your Commercial Property Insurance.

Tags: business owners, commercial building owner, commercial insurance, competitive edge insurance, COPE, inflation, insurance rates
Share this entry
  • Share on Facebook
  • Share on X
  • Share on X
  • Share on LinkedIn
https://compedgeins.com/wp-content/uploads/2022/11/Commercial-Buildings.jpg 836 1255 https://compedgeins.com/wp-content/uploads/2020/11/logoweb.png 2022-11-28 09:00:002024-01-02 17:55:04How to COPE in an Inflationary Environment
You might also like
PhishingWhy is Phishing the #1 Thing Killing Small Businesses?
piece of paper on desk with pen that reads "directors & officers liability INSURANCE"Understanding D&O Insurance: What You Need to Know
person typing on a laptop with images projected out including an umbrella symbolCyber Liability: Mitigating BYOD and E-discovery Risks
IT Consultant with Cyber Security in Background | Envato Elements by kjekol | Licensed | All Rights Reserved5 Reasons Why Your Small Business Needs Cyber Insurance and Why Ignoring It Could Be a Nightmare
2021 Builders Risk and Construction OutlookWhat to Expect from Changing Contractor Costs
Coins on a table, a red up arrow and wooden house.Why Increases in Inflation Might Mean that Your House is Underinsured
The Four Types of Insurance Coverage for your BusinessFour Types of Insurance Coverage for your Business
Insurance TrendsInsurance Trends in 2022: What to Watch For

CATEGORIES

RECENT POSTS

  • Cyber Security Image by Anderson Piza at Envato Elements | Licensed
    6 Current Cyber Threats Companies Face: How to Stay Safe
  • Insurance Form Image by rfaizal707 at Envato ElementsEnvato Elements by rfaizal707
    Understanding the Hard Insurance Market and Its Impact on You
  • Black and White Photo of a man writing a contract
    EPLI: Does Your Construction Business Need It?

CONNECT WITH US

VIDEO POSTS

  • City view of commercial buildings, including skyscrapers surrounded by trees
    How to COPE in an Inflationary Environment
  • Coronado bridge aerial view
    Get to Know Our Founder: Her Rotary Involvement
  • Insurtech holographic image with man using ipad
    The Coverage Pitfalls of Insurtech
LET’S TALK

WANT TO KNOW HOW MUCH YOU COULD BE SAVING ON YOUR INSURANCE COSTS?

WANT TO KNOW HOW MUCH YOU COULD BE SAVING ON YOUR INSURANCE COSTS?

LET’S TALK

Connect With Us

Competitive Edge Insurance

LIC #0H31982

P: 619-259-5459
F: 619-377-0144

830 Orange Ave Suite L Coronado, CA 92118

Privacy Policy

Hours of Operation

Monday – Friday 8:00AM – 5:00PM

Saturday Closed

Sunday Closed

© Copyright 2021- Competitive Edge Insurance

site design by digitalstoryteller.io

© Copyright 2021- Competitive Edge Insurance
site design by digitalstoryteller.io

Top Tips to Recession-Proof Your Businessgraph illustrating downward trends from the recession with a calculator and pen and pencilBlack and White Photo of a man writing a contractEPLI: Does Your Construction Business Need It? Scroll to top

This site uses cookies. By continuing to browse the site, you are agreeing to our use of cookies.

Accept settings

Cookie and Privacy Settings



How we use cookies

We may request cookies to be set on your device. We use cookies to let us know when you visit our websites, how you interact with us, to enrich your user experience, and to customize your relationship with our website.

Click on the different category headings to find out more. You can also change some of your preferences. Note that blocking some types of cookies may impact your experience on our websites and the services we are able to offer.

Essential Website Cookies

These cookies are strictly necessary to provide you with services available through our website and to use some of its features.

Because these cookies are strictly necessary to deliver the website, refusing them will have impact how our site functions. You always can block or delete cookies by changing your browser settings and force blocking all cookies on this website. But this will always prompt you to accept/refuse cookies when revisiting our site.

We fully respect if you want to refuse cookies but to avoid asking you again and again kindly allow us to store a cookie for that. You are free to opt out any time or opt in for other cookies to get a better experience. If you refuse cookies we will remove all set cookies in our domain.

We provide you with a list of stored cookies on your computer in our domain so you can check what we stored. Due to security reasons we are not able to show or modify cookies from other domains. You can check these in your browser security settings.

Google Analytics Cookies

These cookies collect information that is used either in aggregate form to help us understand how our website is being used or how effective our marketing campaigns are, or to help us customize our website and application for you in order to enhance your experience.

If you do not want that we track your visit to our site you can disable tracking in your browser here:

Other external services

We also use different external services like Google Webfonts, Google Maps, and external Video providers. Since these providers may collect personal data like your IP address we allow you to block them here. Please be aware that this might heavily reduce the functionality and appearance of our site. Changes will take effect once you reload the page.

Google Webfont Settings:

Google Map Settings:

Google reCaptcha Settings:

Vimeo and Youtube video embeds:

Other cookies

The following cookies are also needed - You can choose if you want to allow them:

Privacy Policy

You can read about our cookies and privacy settings in detail on our Privacy Policy Page.

Privacy Policy
Accept settings