All of these coverages can come into play with a loss to records that have no duplicates and must be reconstructed.
In the case of a loss to paper or other “hard copy” records, only valuable papers and records coverage will respond for the purposes of researching them for restoration. That’s why it continues to be a critically important coverage.
It follows, then, that any VPR limit, built in or added by an inland marine policy or endorsement, should be applied first to the costs of reconstituting non-electronic records — even if, as with the ISO Businessowners form, it may be theoretically possible to apply that limit to other types of records.
Losses to electronic records can potentially be addressed under three different coverages, if present:
Given the potential for coverage under various policies for loss to business records, there are several key considerations for structuring coverage:
It’s hard to predict how such losses will occur, but insurance and risk management professionals can distinguish themselves and best serve their clients by considering and preparing for the many possibilities.