Hall of Shame – Sprinkler Warranty on the Policy of an Insurance Agent’s Tenant?

This scenario represents an actual coverage flaw in an insurance program of a well run, profitable business.

A tenant occupying a 5,000 square foot office suite in a 100,000 square foot 3-story building purchased an insurance policy including the following requirement:

The Problem

What did the “Schedule above” obligate this small tenant to maintain?…

The sprinkler system was not within their control!

What was Really Troublesome

Not only did the Tenant have no control over the operation or maintenance of the sprinkler system, their landlord and building owner was their insurance agent!

The Solution

Negotiating an exclusion like this off of a policy under these circumstances is relatively simple. If the agent understood the quotation and read the policy, they would have realized how ridiculous this was.

How KMRD Can Help:

KMRD delivers risk management and human capital solutions to over 600 clients nationwide. Our award-winning team, disciplined approach, proven processes, combined with our risk management portal make KMRD the leading choice to improve business protection and reduce the overall cost of risk.


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