What Is Actually Insured When You Move?

Wednesday, July 28, 2010

3 Tips to Avoid Insurance Nightmares

When hiring a vendor to come into your facility, do you worry?
Surely the reputation of the firm and the rapport you developed with the representative helped make you comfortable. And you probably considered how well trained and dependable their staff is.

And you checked to be sure they had insurance. But what kind of insurance did you check for?  Did you even know what to ask?  Did they offer additional coverage options? 

The devil is in the details.

According to Jim Laverty of Barney & Barney, what you don’t know really can hurt you. A lot of businesses make assumptions about the type of coverage their vendors get—and never check into it at all.

If things break, you may have to buy new.

According to Doug Galloway of Vanorsdale Insurance Services, businesses tend to obtain policies that cover the depreciated cost of existing assets. If things need to be replaced, chances are the insurance settlement wouldn’t cover the cost of new items.

And worse, as in our example below, basic insurance provided through movers is often determined by the weight of items being moved—with no consideration for the inherent value at all.

Do you have an extra $75,000?

A major, national moving company was hired to move the corporate offices of a Texas business. They confirmed to the client that the insurance policy was in place and everything was covered. During the move, one of the client’s rack-mount servers was dropped and broken. When the client requested compensation, they were offered $0.65/pound—adding up to about $325 to replace the 500 pounds of lost equipment. Ultimately, the client was forced to cover the $75,000 replacement cost on their own.

Avoid your own personal insurance nightmare by using these fail-safe tips when hiring a vendor to move your business or work in your facility:

1. Make sure your insurance covers repairs and replacement costs.
   Make sure the insurance policy will cover the cost to repair or replace computers, desks, or whatever you are moving that could potentially be damaged. Ask your vendor to show proof of this coverage, and also ask them to explain the policy to you.
2. Set the value yourself.
   Tell your vendor how much coverage is needed, not the other way around. Then ask to see the coverage form and find out how their policy might coordinate with your existing insurance. Such legwork could save you thousands of dollars and headaches down the road.
3. Get a guarantee.
   Work with a vendor that takes enough pride in their work to guarantee it. If you work with MyOffice, for example, you get the peace of mind offered by the Gold Star Guarantee. At MyOffice, if you are not satisfied, we will find a solution to the problem within one week or give you $1,000 cash. To make you feel even better, we’ve never had to pay out the $1,000, and our client satisfaction rating is a 9.96. So—who do you want handling your servers?