Sign insurance is important. Hurricanes and storms can wreck billboards. The digital billboard pictured below was destroyed by an electrical short. One of my lending clients had a digital board damaged by a fire on an adjacent property.
Lenders will require you to carry three kinds of insurance. (1) An umbrella corporate liability policy for $1 million which will cover you from lawsuits related to the operation of your business, (2) A replacement policy on each of your boards which will pay for them to be replaced if they are damaged or destroyed. (3) Key man life insurance which will pay off the lenders loan in case you die. This is especially important to a lender if a business is dependent on a single individual. It also makes sense for you as a business owner. Do you want the lender wrangling with your spouse over how your business should be run when you die or would you rather have the business pass into your estate free and clear of all debt?
Insurance is cheap. My $1 million corporate policy costs about $115/month. In addition I pay about $16/month per billboard for a $25,000 replacement policy. Digital billboard insurance costs more because digital boards are 5-8 times more expensive than steel.
