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Around the Wash<br />

The Roof -<br />

Cosmetic Damage Exclusion<br />

The second and more recent endorsement, in<br />

this case it is an exclusion of coverage, that insurance<br />

carriers have begun attaching to new and renewal<br />

policies is the Roof - Cosmetic Damage Exclusion.<br />

Commercial property insurance coverage is<br />

“triggered” by a covered peril (hail, wind, etc.) having<br />

a damaging effect on insured property. This is<br />

generally called “physical damage” by insurers; however,<br />

the term “physical damage” or “damage” is not<br />

specifically defined in most insurance policies. This<br />

means that ANY physical alteration to the property,<br />

no matter how slight, can be considered damage,<br />

thus triggering a claim being paid. To limit coverage<br />

for “non-functional damage”, insurers have begun<br />

to include the “cosmetic damage” exclusion. Cosmetic<br />

damage is usually defined as marring, pitting<br />

or other superficial damage from hail or wind that<br />

alters the appearance of the roof, but does not prohibit<br />

it from functioning as a moisture barrier. What<br />

this means to the wash owner is that if a Roof - Cosmetic<br />

Damage Exclusion is attached to your commercial<br />

property insurance policy and your roof is<br />

damaged by hail…unless your roof is leaking, you<br />

most likely will not be able to file a claim against<br />

your insurer, regardless of how ugly the roof looks.<br />

Three Important Steps<br />

So, the bottom line here is that if you own a<br />

wash in a storm susceptible area, which seems to be<br />

encompassing more and more of the country lately,<br />

that you take the time to review your property policy<br />

closely. If your policy contains an endorsement<br />

for Wind/Hail deductibles or a Roof – Cosmetic<br />

Damage Exclusion take these three steps to properly<br />

manage your coverage.<br />

1. Read your policy – make certain that you<br />

fully understand the deductible placed on your policy.<br />

2. Talk to your agent – make sure your agent<br />

fully explains all the requirements and nuances of<br />

your policy. Ask if there are alternatives available<br />

through your current insurer or other carriers.<br />

3. Be prepared - catastrophes happen. No<br />

matter where you live in the United States, you’re<br />

just a couple of years away from some major catastrophic<br />

event. If your policy has implemented<br />

a Wind/Hail deductible, make sure you have the<br />

money saved up so you’ll be able to pay it when<br />

that inevitable storm strikes.<br />

Dan is licensed in all states (except Alaska &<br />

Hawaii) and has been assisting business owners<br />

protect their operations, assets, customers and<br />

employees for over 25 years. For questions regarding<br />

this article or other insurance matters he can be<br />

reached at carwashinsuranceguru@gmail.com<br />

WHAT THE HAIL?<br />

Hail usually strikes the hardest in the<br />

spring months, but can last throughout<br />

the summer. The largest hailstone recorded<br />

measured in at 8” in diameter, 18.5” in<br />

circumference, and weighed 1.94 pounds<br />

was found on July 23, 2010, near Vivian,<br />

South Dakota, according to Weather<br />

Underground Historian Chris Burt.<br />

The heaviest hail recorded was found<br />

in Gopalganj District, Bangladesh, on<br />

April 14, 1986, and weighed 2.25 pounds<br />

On July 30, 1979, in Fort Collins, Colorado,<br />

a hailstorm, produced pellets the<br />

size of grapefruits.<br />

On April 20-21, 2006, in San Marcos,<br />

Texas, a hailstorm produced hail that<br />

was 3.9 inches in diameter.<br />

On April 14, 1999, in Sydney, Australia,<br />

40,000 vehicles were damaged during a<br />

hailstorm which produced hail that was<br />

3.7 inches in diameter.<br />

8 • WINTER 2024<br />

WINTER 2024 • 9

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