As we move into the fall, camp owners are assessing their maintenance needs and capital expenditures for the offseason. One of the common discussions I have with camp owners and Operation Directors is what to do with our "old" building(s). Many of our camps have been around for 50, 60 or even 100 years. And with that, some of our buildings are just as old, having only had some additions and minor repairs in all that time. Thus, I put the word OLD in quotes, because I have heard many euphemisms in describing that "old" building. Rustic, historic, in need of some repair, well used... any of this terminology ring a bell?
Well, whatever adjective you may use to describe it, an "old" building that is in need of repair has some special considerations. There are the camp and historic implications of course, and you weigh those implications against the costs and complexity of fixing/repairing only certain parts of such buildings, and then, an often forgotten consideration, the cost of properly insuring that "old" building. So ultimately you must weigh these important points against whether it is just better and more simple (although much more expensive) to tear down and build a new building in place of that "old" building.
The purpose of this blog is to key on an often overlooked aspect that must be considered - the insurance costs for properly insuring that old building - even after the expense of repairs and maintenance. In general, the older the building, the more insurance will cost - and that is significant where you have a camp with multiple older buildings. Another generalization, most buildings are under-insured because over time many things change that make it more expensive to rebuild/repair that old building - material costs increase, building codes change, inflation - none of this will make the building less expensive to rebuild.
Possibly the most expensive consideration though is that each of these individual buildings contain an inherent and often unique series of values which deserves a higher degree of care and consideration. This philosophy needs to be applied when assessing requirements for property insurance to ensure that the appropriate levels of coverage and protection are provided. In addition, the design and construction of historic buildings invariably makes them more vulnerable to damage, especially by fire, and more expensive to repair after damage has occurred. You must consider - if that historic building was severely damaged or lost, would you make the effort to rebuild it a very similar manner so as to recreate the uniqueness of the building. And if the answer is yes, your insurance company may require specific and separate coverage for these buildings individually, which of course will increase your overall insurance costs.
So what to do? First, walk your property with an expert who can help you assess each of your individual buildings. Assess from both a maintenance perspective but also consider what you would do if the building was severely damaged. Your first consideration here is prevention and then insurance. Can you add fire prevention, update electrical wiring, or even rebuild parts of the building without losing the history/uniqueness while making the building more safe and thus less of an insurance risk? But beyond those considerations, in determining your insurance needs, you really need to consider what you would do to the building if it was extensively damaged. And make the determination if it is all worth it.
Once you know what you want to do, contact your insurer and go over the coverage of each of individual buildings. If you intend to rebuild any one of your historic buildings in the case of a catastrophic loss, make sure the replacement cost value is adequate in present day dollars. BUT... be prepared to pay a premium to do so.
If you want to discuss your property needs in more detail contact Abrams Camp Consulting TODAY for a free initial consultation.