Property Insurance for Self-Storage Facilities

Your buildings and facility infrastructure are significant investments.

Potential property losses can include:

• Fire

• Wind and hail

• Water damage

• Vandalism

• Theft

• Roof damage

• Equipment failure

• Other covered causes of loss

Depending on the facility, property coverage may need to address multiple buildings, office areas, gates, fencing, lighting, signage, security equipment, and other property associated with the operation.

We look at the entire property when evaluating your insurance needs.

The Property Inside the Units

One of the most important distinctions in self-storage insurance is understanding who owns what. The contents of a storage unit generally belong to the tenant—not the storage facility owner. A facility owner's property insurance is not automatically designed to insure the customer's personal property.

That distinction can become particularly important following a fire, water loss, theft, or other major event.

We help owners understand the difference between:

Your property
and
Your tenant's property.

Your lease and insurance program should work together to clearly address these responsibilities.

Fire Risk

Fire is one of the most significant potential losses for a storage facility.

A fire can potentially damage multiple units and structures at the same time and may result in:

• Building damage

• Loss of rental income

• Cleanup costs

• Business interruption

• Liability claims

• Disputes regarding stored property

Fire protection systems, construction, spacing between buildings, electrical systems, tenant activities, and facility design can all influence the overall risk.

Water Damage

Water can be particularly problematic in self-storage.

A plumbing failure, roof leak, sprinkler issue, frozen pipe, or other water event can damage multiple units and potentially create significant disputes regarding customer property.

Water exposure should be evaluated carefully, including the policy's applicable deductibles, exclusions, limitations, and coverage terms.

Theft & Security

Storage facilities are designed to provide customers with a secure place to store their belongings.

That makes security an important part of the risk profile.

Potential exposures include:

• Unauthorized access

• Gate failures

• Broken locks

• Theft

• Vandalism

• Security system failures

• Inadequate lighting

• Claims alleging negligent security

Security cameras, fencing, gates, access controls, lighting, management practices, and tenant procedures can all play a role in evaluating the exposure.

Premises Liability

Customers and visitors are regularly entering and leaving storage facilities.

Potential liability exposures include:

• Slip-and-fall claims

• Vehicle accidents

• Injuries in drive aisles

• Gate-related injuries

• Stairway accidents

• Falling objects

• Lighting-related incidents

• Property damage

The layout of the facility and the way customers access their units can have a significant impact on the premises liability exposure.

Tenant Property & Liability Claims

Storage operators can face allegations that property was damaged, lost, stolen, or otherwise mishandled.

Even when the facility owner does not own the stored property, customers may still bring claims against the operator.

That makes the wording of your lease, facility procedures, and liability insurance particularly important.

A strong self-storage insurance program considers not only what you own, but also the claims that could arise from what your customers store.

Business Income & Rental Income

A major property loss can affect your revenue long after the physical damage occurs.

If units or buildings become unusable following a covered loss, you may lose rental income while repairs are underway.

Business income and rental value coverage can help address certain covered income losses resulting from an interruption.

The appropriate limits should be evaluated based on the facility's actual rental income and projected recovery period.

Equipment Breakdown

Self-storage facilities can rely on a variety of electrical and mechanical systems, including:

• Automatic gates

• Security systems

• Access-control systems

• HVAC

• Electrical equipment

• Pumps

• Elevators

• Other building equipment

Equipment breakdown coverage can address certain losses resulting from covered mechanical or electrical failures.

Climate-Controlled Storage

Climate-controlled facilities can have additional exposures because they rely on mechanical systems to maintain specific environmental conditions.

A system failure can potentially affect numerous units and the property stored inside them.

For these facilities, equipment breakdown, business income, temperature-related considerations, and appropriate risk-management procedures deserve particular attention.