Allied lines are a specialized form of property and casualty insurance that are often sold in tandem with fire insurance. The focus of this type of coverage is to provide protection for various types of disaster situations that can undermine the ability of a business to continue functioning. While the actual range of situations covered will vary from one policy to the next, most will include protection against vandalism, acts of nature, and the replacement of lost or damaged machinery or equipment.
In some instances, the coverage provided by allied lines insurance is very broad. For example, if the policy covers situations that are considered acts of nature, the terms are likely to include specific events such as earthquakes, floods, lightning strikes, wind damage from tornadoes or hurricanes, and possibly even avalanches. The scope of coverage is often based on what types of natural disasters could occur within the general area where the business is located. As is true with many forms of insurance, coverage for events that have an increased possibility of occurring will carry a higher premium than those that are less likely to occur.
Along with protection from natural disasters, most allied lines policies will also provide coverage for losses resulting from structural issues with the building where the business is housed. This can include issues such as a leak in the overhead sprinklers that are part of the fire safety system, or damage to masonry or other areas of the construction that allow documents or equipment to be exposed to humidity or dampness. Often, the coverage not only provides funds to aid in the repair of the structural problem, but also to repair or replace documents or equipment that were damaged as a result of the problem.
Allied lines insurance typically includes protection from damage resulting from acts of vandalism. Vandalism is often defined for purposes of coverage as any act where illegal entry by one or more persons results in the theft of property and the destruction of other property that remains within the facility. For example, if vandal broke into an office and stole several pieces of office equipment, and stopped long enough to spray paint obscenities on a wall in the reception area, the allied lines insurance would help in replacing the equipment and in repairing the damage to that wall.
The actual cost of allied lines insurance will vary, based on the scope of coverage provided, the physical location of the business, and any regulations in the local jurisdiction that impact the costs of insurance coverage in general. As with any type of insurance coverage, consumers should compare rates and terms of coverage offered by several different providers before making a purchase. Taking the time to understand the scope of coverage, the cost, and what can reasonably be expected in terms of the claim process, can help minimize frustration during a time of need.
