Navigating Commercial Insurance Renewals in a Tough Market

Sep 29, 2025
Categories: Business Insurance
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Business Insurance Renewals in a Tough Market

Continued uncertainty surrounding US tariffs, supply chain disruptions, extended delays, and other issues are reshaping business operations. However, the insurance industry is seeing that many commercial insurance clients are sticking with their existing coverage instead of adapting their insurance policies to address emerging risks.

Why? Tighter budgets and a tough market are limiting the ability of some businesses to expand or adapt protections. Here’s what you need to know about this trend and how to navigate your own business insurance renewals.

Why Clients Are Renewing “As Is”

Commercial insurance brokers report that most clients are renewing the same business interruption (BI) programs as previous years, with little or no changes. Why?

  • Tight Budgets: Organizations lack funds to increase limits or extend coverage
  • Challenging Market: Economic uncertainty discourages taking on higher costs in the short term
  • No Appetite for Change: The simplicity of keeping policies the same means some companies are hesitant to adjust their coverage, despite new risks

This approach, however, can leave businesses vulnerable, especially as claims’ costs rise and recovery timelines grow longer.

The New Normal: Extended Restoration Timelines

Today’s disruptions can stretch rebuild periods far beyond what older policies were designed for. Key factors include:

  • Longer Lead Times: Materials are harder to source, delaying delivery and, ultimately, repairs being completed
  • Sourcing Challenges: Finding alternative suppliers to keep costs down or purchase adequate supply orders takes longer
  • Regulatory Delays: Increased customs and compliance hurdles slow restoration timelines, along with increased material costs in some cases

Property policies and Business Interruption coverage goes hand in hand. In the event of a claim – one follows the other. Business Interruption coverage provides protection to a business while it experiences loss of income during downtime after an insured property loss. Without updated business interruption coverages to reflect new realities, businesses risk underinsuring claims during prolonged restoration periods. Businesses should consider extending the Indemnity Period of their Business Interruption coverage as well as their overall Business Interruption limit to account for these increased rebuild and/or repair periods.

LEARN MORE » Business Interruption Insurance | Staebler Insurance

Strategies for Smarter Renewals

Businesses can take proactive steps to strengthen coverage without breaking the budget. Start early and consider these best practices:

  • Align Business Interruption Terms with Reality: Update your insurance policies to match realistic repair timelines, using engineering assessments if possible
  • Extend Indemnity Periods: Further to the last point, consider worst-case scenarios for your business and estimate recovery timelines. Extend the Indemnity Period of your Business Interruption insurance beyond the standard periods where needed
  • Adequate Business Interruption Limits: If a business is extending their Indemnity Period, then very likely the Business Interruption coverage limit will need to be increased too. Otherwise, a business may have the Indemnity Period it needs, but the coverage limit might be exhausted before restoration is completed
  • Update Your Business Interruption (BI) or “Profits” Worksheets: This worksheet will use a company’s financial data to put together an estimated coverage limit. Ensure that your figures reflect current costs, including tariff-driven price changes
  • Don’t forget about the future growth of the business! It’s highly recommended that the limit chosen for insurance should come from the annual estimated business income for the year AFTER the policy term. Keep in mind that if a claim were to happen on the last day of the policy, that claim will be paying for the loss of income going into the following year
  • Review Key Coverages: Evaluate business interruption limits, but don’t forget to also review the total replacement cost limit of any property insurance coverage to ensure it’s adequate in the event of a loss
  • Consider Contingent Business Interruption: protecting against losses arising from disruptions to a company’s supply chain (key suppliers or customers). Typically, this coverage would respond if a supplier’s or customer’s location was damaged by an insured peril (i.e. a peril that is also covered on your business’ own policy)

Be sure to talk to your broker about risks to your business. Get in touch with a Staebler Commercial Solutions Broker to get started today. These steps ensure policies align with today’s economic realities.

RELATED READING » How US Tariffs could impact your Insurance Premiums and Policy Limits | Staebler Blog

Why It Matters

Sticking with outdated coverage might save costs now, but it risks significant losses during a disruption. A policy misaligned with current rebuild timelines could leave businesses short on claim settlements, delaying recovery in an already tough economy. Proactive planning is critical.

Act Before Renewal

As your renewal season approaches, don’t settle for the status quo. Engage your broker early to review exposures and explore cost-effective adjustments. Small changes, like updated worksheets or extension endorsements, can make a big difference in case of a claim.

Work with a commercial insurance broker, stay adaptable, and ensure your insurance keeps pace with changing challenges. Get in touch with a Staebler Commercial Solutions Broker to find out more.

. . .
Staebler Insurance is a general insurance broker specializing in car insurance, home insurance, small business insurance, and commercial insurance. Staebler Insurance Brokers proudly serve Kitchener, Waterloo, Cambridge, Guelph, Stratford, Listowel, Fergus, Elora, Wellington County, Perth County, Waterloo Region, the Greater Toronto Area, Golden Horseshoe, Niagara Region, and all over beautiful Ontario, Canada. Get a Quote to get started today.

 

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