My business grew, so I rented a 10×10 unit at Public Storage to hold extra inventory and seasonal tools. I went there last week, and the lock was cut. $15,000 of gear gone. My insurance company pointed to the “Off-Premises” limit on my policy, which was capped at $2,500.
Key Takeaways
- “Off-Premises” Limits: Standard property policies cover your main shop (Scheduled Premises) fully, but cap coverage for items “off-premises” (like at a storage unit) to a low sub-limit (often $2,500 or $5,000).
- You Must Schedule the Unit: To get full coverage, you must list the storage unit’s address as a “Scheduled Location” on your policy.
- Storage Facility Insurance is Junk: The insurance the storage place sells you (for
15/mo)usuallyhasalowcap(15/mo)usuallyhasalowcap(2k-$5k) and excludes “vermin,” “mold,” and sometimes “unexplained loss.” - Flood Risk: Storage units are often built on cheap land (flood plains). Standard policies exclude flood. Verify if your unit is in a flood zone.
The “Why” (The Trap): Location, Location, Location
Insurance rates are based on the security of the location listed on the Declaration Page.
- Your Shop: Alarmed, monitored, known risk. (Full Coverage).
- Random Storage Unit: Unknown security, high theft risk. (Limited Coverage).
If you store $15,000 of tools there permanently (more than 30 days) but don’t tell the insurer, they treat it as an “Off-Premises” exposure, which is strictly capped.
The Investigation: “I Called Them”
I tried to insure a storage unit full of tools.
1. The Storage Facility’s Plan
- Cost: $20/month.
- Limit: $5,000 max.
- Exclusions: No flood, no rodent damage, strict burglary proof required.
2. Updating My Commercial Property Policy
- Action: I called my agent to add “123 Storage Lane, Unit 45” as “Location #2”.
- Cost: Increased premium by $50/year.
- Limit: Full $15,000 coverage extended to that unit.
- Verdict: Much cheaper and better coverage than the facility’s plan.
3. Inland Marine (Floater)
- Action: Since Inland Marine covers tools “anywhere,” it technically covered the storage unit without listing the address.
- Caution: Some floaters have a “Storage / Warehouse” clause that requires reporting if stored longer than 90 days.
Comparison Table: Storage Unit Options
| Coverage Source | Monthly Cost | Coverage Limit | Flood Covered? |
| Storage Facility Plan | $15 – $30 | $2,000 – $5,000 | No |
| “Off-Premises” Extension | Included | Capped (~$2,500) | No |
| Adding Location to Policy | ~$5 | Full Limit | No (Need Flood Ins) |
| Inland Marine Floater | Included | Full Limit | Sometimes |
Step-by-Step Action Plan
- Check Your Off-Premises Limit: Look at your policy today. If it’s $2,500 and you have $10k in storage, you are exposed.
- Call Your Agent: Give them the address of the storage unit. Ask to add it as a “Scheduled Location.” It’s usually very cheap.
- Decline the Facility Insurance: Once your own policy covers it, stop paying the $15/mo to the storage place. Just show them your Certificate of Insurance (COI) to satisfy their lease requirement.
- Buy a Disc Lock: Don’t use a regular padlock. Storage units are easily cut. Use a round “Disc Lock” or cylinder lock.
FAQ
Q: Does my policy cover my tools if the storage facility burns down?
A: Yes. Fire is a covered peril.
Q: What if rats eat the wiring of my tools?
A: “Vermin” is almost always excluded. Put electronics in plastic tubs, not cardboard boxes.
[IMAGE: Photo of a storage unit door with a cheap padlock (Red X) vs a Disc Lock (Green Check).]