May 21, 2022
  • May 21, 2022

What is commercial property insurance? – Councilor Forbes

By on May 12, 2021 0

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Commercial property insurance protects the physical assets of your business. In the event of a fire, pipe burst, thunderstorm or thieves’ strike, commercial property insurance is here to help pay for damage to your commercial property.

Large or small, a business has physical assets that are worth protecting, so it’s worth purchasing commercial property insurance. This coverage is also called business property insurance.

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What does commercial property insurance cover?

Commercial property insurance typically covers your business building or office, equipment, tools, inventory, supplies, computers, business furniture, valuables and business records. It also covers outdoor installations such as fences and signs.

The property of others is also covered by commercial property insurance.

See if the policy is a “named risk” or “open risk” policy.

• A named perils policy will only cover costs for issues specifically listed in the policy, which typically include fire, theft, vandalism, and wind damage.

• An open risk policy will offer you broader protection. It will cover all issues except those listed as exclusions (eg flood damage). Because of its better protection, it will cost more than a property named peril insurance policy.

How much does commercial property insurance cost?

The cost of insuring commercial property primarily depends on the value of the property and assets of the business. A person insuring a home office would pay much less for business property insurance than a business with its own office building, but both have business assets that could be covered by a business property insurance policy.

Here are some other factors that insurance companies take into account when pricing commercial property insurance policies.

The location of your business. Is it prone to wind or rain storms? Bad weather can damage commercial property.

The construction of your building. Was the building constructed with fire retardant construction materials? Are the plumbing and electricity up to date?

Your industry. An accountant’s office is likely to be much less risky than a deli.

Protection against fire and theft. How far is the nearest fire station? What type of fire alarm and sprinkler system does your business have? What type of security system is there to thwart thieves?

A commercial property insurance policy has a median cost of $ 63 per month or $ 756 per year according to Insureon.

You don’t have to be a homeowner to purchase commercial home insurance for your business. You can get coverage if you rent your office space and / or office equipment.

Buy insurance for commercial property with a policy for business owners

If you are a small business, you can purchase home insurance through a Business Owners Insurance Policy (BOP). A BOP combines commercial property insurance, general liability insurance and business interruption coverage. Buying the fonts in a package like this can be cheaper than buying them separately.

General liability insurance protects a business against a number of claims such as personal injury and property damage, copyright infringement, damage to reputation, and damage to advertising. If someone sues your business for any of these issues, commercial liability insurance will pay for legal fees and any settlements or judgments.

Business interruption insurance helps a business recover lost revenue due to a covered risk. If you can never open your business because of a problem covered by the policy, such as a fire or windstorm, this type of insurance will reimburse you for lost business income.

Business interruption insurance is also known as business income insurance.

A business owners policy costs an average of $ 53 per month, according to Insureon.

What issues are covered by commercial property insurance?

A commercial property insurance policy generally covers the loss of your business property due to fire, lightning, wind, and hail. Business property insurance also covers theft and vandalism.

With a commercial property insurance policy, you’ll want to make sure that your office building, commercial equipment, and outdoor items such as signs, fences, and storage sheds are all covered by the policy. You’ll also want to make sure your business inventory is covered.

How do I get commercial home insurance?

There are generally two types of commercial property insurance: replacement cost and actual cash value.

• Replacement cost coverage pay to rebuild or replace your business property using materials of the same or comparable value. There is no capital cost allowance.

• Actual cash surrender value hedging will pay the current value of the damaged property. This takes depreciation into account, so a claims check will not be enough to replace what has been lost with new items; you will have to pay the difference. However, real cash value coverage will lower your monthly insurance bill.

Should I buy commercial property insurance for my home business?

Depending on the size and needs of your business, home business insurance through your home insurance company may be sufficient.

But commercial property insurance offers more coverage than a home insurance policy and can better protect a business and all of its physical assets and equipment.

What does commercial property insurance not cover?

It’s important to know when business property insurance won’t help you and you may need additional coverage:

• You have a car accident while driving the company car during a business delivery. This scenario would be covered by commercial auto insurance.

• Bad weather caused flooding in your office building. Flood damage is not covered by commercial property insurance. You will need to purchase a separate flood insurance policy to protect your office space against the costs of flood damage.

• You accidentally damage a customer’s wall while visiting them on business. This type of material damage would be covered by general liability insurance.

Do i need commercial property insurance for my business?

Without commercial property insurance, you are responsible for paying out of pocket for any damage to your business equipment and property. In the worst case scenario, like a massive fire, it could bankrupt you without insurance for financial support.

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