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Wednesday, November 14, 2018

Water Damage in Hotels and Motels

By the RestorationSOS Educational Staff

Most people associate water damage with floods as in flash floods due to storms, but it can be caused by many other incidents from malfunctioning sprinklers to broken pipes. Whatever the cause, when water enters parts of a hotel that should be dry, the resulting risks are numerous and they are the type classified as pure risks where there are potential losses but no potential gains.

For the hotel business, water damage could mean inconvenience to guests, customer complaints, management headaches, legal liabilities and significant loss of investment and profits to the company. This is precisely why most hotels insure against contingencies such as water damage to reassign the risks to insurance companies. However, many water-damaged companies fail to recover fully even with insurance because of tough competition in the industry and the fact that a hotel business is usually cyclical.

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