NAICS CANADA CODE: 531130 Self-storage mini-warehouses

Description of operations: Mini-warehouses are an extension of the client’s basement or business. Any items may be stored, and access is limited to the clients themselves.

Property exposures are largely unknown because there are no requirements regarding disclosure of contents. While there may be leases or contracts to prevent the storage of flammables and hazardous materials, violations are not usually noted until after the loss.

Crime losses may be high, especially from fidelity. It is important to evaluate all potential exposures to crime losses.

Inland marine loss potential centres around Warehousemen's Legal Liability. What controls are in place to protect the customers’ goods while in storage? Locks should be changed regularly. Are there firewalls between spaces?

Occupiers’ liability is not a high concern if visitor or customer access is limited. However, in the case of mini-warehousing, exposures increase due to the regular visits by clients to their spaces. There must be adequate security in place. Lighting and fencing are very important. In some cases, 24-hour security is appropriate.

Automobile liability exposure depends on whether or not pickup and delivery services are offered. If they are, exposure is significant. Frequency, radius, age, and condition of vehicles, as well as age, training, and records of drivers, are evaluation concerns.

Workplace safety exposures can be extensive if packing is offered. However, the exposure may be office-only if only storage services are available. The major exposure is eviction and execution of the Warehousemen’s Lien. Back and lifting injuries, hernia, sprain, and strain may occur as spaces are cleared out. Renters may become angry. The training of workers in material lifting and conveying devices is important, along with the ability to work with unhappy clients.

Minimum recommended coverage:

Building, Business Personal Property, Business Income, Accounts Receivables, Computers, Valuable Papers, Warehousemen’s Legal Liability, Dishonesty, Disappearance and Destruction, Money and Securities, General Liability, Umbrella, Non-owned Automobile

Other coverages to consider:

Building, Employment Practices Liability, Environmental Impairment, Business Auto Liability and Physical Damage

Source: Rough Notes, Inc.

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