The recent trends in the economy have certainly affected the real estate market. Hopefully many of you are paying less in rent now than you did five years ago. If you are near the end of your lease and your current landlord isn’t able or willing to negotiate with you on your new lease – you may be looking at moving into some space down the street. Prior to moving, here are some insurance tips to keep in mind:
1. Review the entire new lease with your legal advisor prior to signing – including the insurance section. Make sure your insurance carrier can provide the coverages and requirements they are requesting for an affordable premium. If not, then you may want to negotiate with your landlord prior to signing this new lease. Sometimes landlords will have high insurance limit requirements because they use the same Boiler Plate lease for you as they do for their anchor tenants. Most individual tanning salons don’t have a $5,000,000 Umbrella policy in place, but if your lease requires these high limits, then you will be legally obligated to carry the required coverages.
2. Many times during a move, tenants will have overlapping leases. You may move into your new salon on May 1, but you won’t be done with your existing lease until June 30. Prior to signing the new lease, contact your insurance agent. The new location should be added onto your policy right away. Many times, owners forget to inform their agent of new endeavors. Usually if you don’t remember to add the new location, your landlord will require proof of insurance for the new location prior to giving you the keys. If you sign the lease on a Friday and can’t get in touch with your agent until that Monday or Tuesday, try to see if your agent will back-date coverage to that Friday. Most insurance policies have a bit of a grace period where the company will be willing to back-date coverage for new locations. Similar to your previous space, the landlord will probably request to be an additional insured on your policy. As for your existing location, you don’t want to delete this location from your policy until your name is off the lease. Even though you have moved your property out of the salon, you still have liability exposure at the old location.
3. When it is time to finally make the move, the moving company should be licensed, insured and bonded. Similar to working with any contractor, accidents often occur while moving. Make sure that your equipment is properly insured while in their possession and in transit. If you are doing the moving with your staff, touch base with your insurance agent to see what coverages need to be added to your policy. For a minimal premium, your insurance agent might be able to add some property-in-transit coverage. When dealing with difficult-to-move tanning equipment, this is a no-brainer.
4. When you are making all these changes, now would be a good time to review your coverages and limits with your agent. The more you tell your agent about your business model, the more they can assess your risk. This could also be a great opportunity to review different enhancements to coverages.
These are just some tips to consider prior to moving to a new location. If you have additional questions, feel free to contact our office. We would be more than happy to discuss your potential move.
Jenny Bortman is an account executive for Universal Insurance, which has been serving professionals in the indoor tanning industry since 1993. For a competitive, personalized quote or additional information about Universal’s exclusive Tanning Salon program, call 800.844.2101 or visit www.uitanning.com.