Have you ever had to pay someone to haul away “junk”? Such as a mattress, appliance, or construction materials from a small remodeling project? The cost can be surprising. That is for a simple haulaway. Now multiply that by a degree of magnitude for a commercial building, probably many times the size of your living space.

Debris Removal is often an overlooked expense – that is, until after a large loss when the expense may be mostly left to the policy holder. ISO’s Building and Personal Property Coverage Form (CP 00 10) does grant coverage, but it’s a pretty small amount. There are a few limits for Debris Removal:

1. 25% of: the limit for direct physical loss + the deductible. This does not increase the limit, merely makes 25% of the limit available for debris removal.
2. $5,000 if the property has not sustained physical damage (for example, debris blew onto the site after a tornado damaged neighboring building)
3. Additional $25,000, only if two conditions are met:
   a. Total of removal expense plus direct physical loss exceeds the Property limit.
   b. Actual debris removal expense exceeds 25% of: the amount paid for direct physical loss + deductible.

There are several exclusions to the coverage, such as outdoor property (unless it is a type specifically covered in the form), property of others, and mud or earth deposits.

Even the additional $25,000 may fall well short of the actual need after a loss. The costs vary, of course, by location and accessibility of the property. Factors affecting the cost can include hazardous waste disposal, difficulty in accessing the site, whether demolition is needed, permits required and regulations. Before you think your insured or prospect does not have hazardous waste, remember that everyday items we all keep around us are categorized as hazardous: bleach and other cleaners, batteries, pesticides, paints and solvents, drainer openers. These all require specialists for disposal.

A quick Google search tells us that the cost for debris removal are $2 to $8 – per square foot. The cost for haulaway only, not for labor, is $500 to $1,000 per truckload. Now think about how many truckloads are in a 5,000 square foot building. Ouch!

There is a solution available. ISO uses form CP 04 15, Debris Removal Additional Insurance. The form replaces the additional $25,000 with a higher limit chosen by the insured and underwriter.