Nationwide: Gap Between Agents, Commercial Clients View of Severe Weather
A Nationwide study has found that independent insurance agents believe many of their commercial clients don’t have adequate coverage to protect their businesses from severe weather.
While 82% of surveyed property stakeholders reported working with an agent to ensure appropriate coverage, “our research indicates there’s a discrepancy between their perceived readiness and the reality of their coverage,” said Mark Berven, president and COO of Nationwide’s property and casualty organization.
Most of the surveyed agents (52%) believe less than half of their clients have an appropriate level of coverage for the severe weather risks they face.
“Weather risks continue to evolve, and as such, adaptation and resilience must become integral parts of a business’s planning and decision-making processes,” Berven said in a press release. “It’s incumbent upon us in the insurance industry to ensure our clients are fully informed about weather-related business risks and how they can best protect against them.”
When asked about the disconnect in confidence, Berven pointed to the nearly 20% of surveyed property stakeholders who confessed they don’t currently engage with an agent or possess sufficient coverage to recover from a disaster.
For the survey, Nationwide polled a total of 500 commercial property owners, new construction builders and business owners to gauge their concern and preparation levels around severe weather events that have or could impact their operations. The survey found that their worries about severe weather are high, and many have felt its effects.
Sixty-two percent of stakeholders reported being either very or extremely concerned, and 36% reported experiencing damage from a natural disaster in the past five years. Hurricanes, floods and tornadoes were listed as the most common disasters that caused property damage.
In hurricane-prone states, 59% experienced property damage in the past five years.
“Every agent should be talking to their commercial clients about climate risk and its implications on protection needs,” Berven said. “At a time when many business owners have tightened their belts to save on expenses, agents can help clients verify they’re insured to value and avoid the pitfall of being pennywise but pound foolish with insurance coverage.”
The majority of commercial property stakeholders surveyed by Nationwide said they’ve talked with an insurance agent about ways to manage or prevent wind (76%), roof (69%) and water (61%) damage to their properties. Eight in 10 agents also report helping clients with these topics regularly.
Nevertheless, the study also found that just 42% of agents prioritize promoting insurance carrier solutions and resources for protecting against severe weather to their clients. Meanwhile, 53% of property stakeholders are willing to spend more to increase their structure’s resiliency.
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