The collapse of Champlain Towers South should cause a revaluation of how Property insurance is underwritten. As buildings age, there should be questions about ongoing maintenance and repairs, and whether a building is still structurally sound.
Historically property underwriters evaluate buildings based on construction, occupancy, protection and exposure (COPE). An analysis by forensic investigator Timothy D. Christ on the www.propertycasualty360 website focuses mainly on construction and maintenance issues. His important questions for policyholders:
- When was the last building appraisal?
- What are comparable area building values?
- Have there been any engineering studies?
- Have any warnings or citations relating to building maintenance been issued?
- Are major mechanical, electrical, plumbing, roofing and structural systems part of an ongoing maintenance agreement?
- Does the building have early warning systems?
- Are there current or recent abnormal performance issues - mechanical, electrical, plumbing or structural?
- Is the building in compliance with any certification requirements?
- Has a property condition inspection been conducted?
- What significant maintenance, renovation or construction work has been done in the past year?
- What are future plans for major renovations and does the insured have the financial stability to finance them?
Alert underwriters will ask these questions. Inadequate or false information is an obstacle to accurate underwriting. Any tendency to cut corners should be resisted.