Public Storage 2014 Annual Report Download - page 25

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11
Limitations on Debt
Without the consent of holders of the various series of Preferred Shares, we may not take any
action that would result in our “Debt Ratio” exceeding 50%. “Debt Ratio”, as defined in the related
governing documents, represents generally the ratio of debt to total assets before accumulated depreciation
and amortization on our balance sheet, in accordance with U.S. generally accepted accounting principles.
As of December 31, 2014, the Debt Ratio was approximately 0.5%.
Our bank and senior unsecured debt agreements contain various customary financial covenants,
including limitations on the level of indebtedness and the prohibition of the payment of dividends upon the
occurrence of defined events of default. We believe we were in compliance with each of these covenants
as of December 31, 2014.
Employees
We had approximately 5,300 employees in the U.S. at December 31, 2014 which are engaged
primarily in property operations.
Seasonality
We experience minor seasonal fluctuations in the demand for self-storage space, with demand and
rates generally higher in the summer months than in the winter months. We believe that these fluctuations
result in part from increased moving activity during the summer months.
Insurance
We have historically carried customary property, earthquake, general liability, employee medical
insurance and workers compensation coverage through internationally recognized insurance carriers,
subject to customary levels of deductibles. The aggregate limits on these policies of approximately
$75 million for property losses and $102 million for general liability losses are higher than estimates of
maximum probable losses that could occur from individual catastrophic events determined in recent
engineering and actuarial studies; however, in case of multiple catastrophic events, these limits could be
exhausted.
We reinsure a program that provides insurance to our customers from an independent third-party
insurer. This program covers tenant claims for losses to goods stored at our facilities as a result of specific
named perils (earthquakes are not covered by this program), up to a maximum limit of $5,000 per storage
unit. We reinsure all risks in this program, but purchase insurance from an independent third party
insurance company for aggregate claims between $5.0 million and $15.0 million per occurrence. We are
subject to licensing requirements and regulations in several states. At December 31, 2014, there were
approximately 823,000 certificates held by our self-storage customers, representing aggregate coverage of
approximately $2.2 billion.