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Course Details

Course Information
  • smart_display Format

    Live Online with Live Q&A

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    Real Property - Finance

Date & Time
  • event Date

    Monday, April 28, 2025

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    90 minutes

Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.

$347.00

This CLE course will provide real estate counsel with an understanding of the various components of property insurance and the current requirements of lenders concerning each type of coverage. The panel will explore the new market realities of obtaining various types of coverage and provide guidance for borrowers and lenders negotiating, drafting, and modifying insurance terms for existing and new loans.

Faculty

Bane Martha
Shareholder
Gallagher

Ms. Bane structures, negotiates, and implements large national property and builders risk programs, with an emphasis on catastrophic exposures. Her expertise with complex layered and quota-share programs and senior insurer relationships helps deliver innovative insurance and risk management property solutions to Gallagher’s clients. Ms. Bane also manages Gallagher’s Los Angeles Real Estate & Hospitality team which specializes in property, casualty, environmental and financial products for Gallagher’s real estate and hospitality clients. They currently place coverage in the worldwide insurance marketplace for clients with more than $189 billion in insurable values. Ms. Bane has spoken at numerous industry events on a variety of property insurance-related topics.

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Schernecke Matthew
Shareholder
Parent: Hogan Lovells US LLP

Mr. Schernecke advises direct lenders, mezzanine investment funds, and venture capital investors in a variety of debt and investment transactions with borrowers of all sizes, types, and structures. He also counsels private equity clients and corporate borrowers on domestic and cross-border acquisition financings, out-of-court restructurings and workouts, bankruptcy matters, ESG and impact investment financings, and real estate financings. Mr. Schernecke leads transactions spanning diverse industries, including financial services, real estate, retail, life sciences, health care, technology, food and beverage, hospitality, film and music entertainment, media, and telecommunications.

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Description

Evaluation of property insurance is a complex undertaking in commercial real estate finance. It is often the final item to be resolved in a transaction, partly because insurance companies frequently need information from third-party reports before finalizing insurance policies.

Lenders want to ensure there is adequate property insurance in place to protect the value of the property and collateral during the life cycle of the loan. The types of coverage typically required are replacement cost, business interruption, ordinance and law, flood, windstorm, earthquake, and terrorism coverage. CMBS loans may have additional coverage requirements beyond what is required in a conventional loan.

In recent years there has been a shift in the property insurance industry due to the number of natural disasters and other environmental factors. This has had a significant impact on the commercial real estate lending market due to the rise in insurance costs and the fact that some coverages required in many loans are no longer available or have greater limitations. This means that some existing and new borrowers are unable to meet their lender's insurance requirements.

With required coverage either not available or limited in certain markets, new and existing borrowers must work with their lenders on any loan modifications that need to be made prior to delivering a Certificate of Insurance to the lender.

Listen as our authoritative panel discusses the latest developments in property insurance coverage and lender requirements and provides guidance for borrowers and lenders navigating the evolving market conditions.

Outline

  1. Overview: standard insurance coverage terms in conventional and CMBS loans
  2. Current issues for borrowers and lenders based on market forced changes with various types of coverage
  3. Evidence that proper insurance is in place: Certificates of Insurance
  4. Drafting tips and advice for lenders for deal-specific insurance provisions based on current market conditions
  5. Guidance for new and existing borrowers trying to fulfill the insurance requirements found in a loan agreement
  6. Practitioner pointers and key takeaways

Benefits

The panel will discuss these and other critical issues:

  • What are the current required insurance coverages in commercial real estate loans?
  • How have changes in the property insurance industry impacted commercial real estate lending?
  • How can borrowers and lenders navigate the new market realities of property insurance coverage to ensure their respective interests are protected?
  • How should insurance requirements in loan documents be modified or adjusted to reflect current market conditions or the specific terms of a transaction?