What Is Commercial Property Insurance?
Commercial Property Insurance helps recover when certain disasters jeopardize your business assets and real estate. Covered events might include fire, windstorms, theft, or vandalism. You can use the payout from your Commercial Property policy to repair or replace items such as your building,
Many Commercial Insurance policies also include Business Interruption Insurance. This policy covers up to twelve months of lost income when certain events force your client to put their business operations on hold. For example, if a fire destroys your workplace, Business Interruption Insurance can pay for the ongoing costs of keeping your business afloat when it can't generate revenue.
How commercial property coverage works
Commercial property insurance coverage varies, but they’re generally classified by the type of event leading to a loss, and by what things are insured.
Basic property insurance usually covers losses caused by fires or explosions, theft, vandalism and damage from vehicles or airplanes. Additional coverage referred to as “endorsements” can be added to provide additional protection for things such as earthquakes and broken glass.
The key items insured in business property insurance include your building, office equipment, inventory and outdoor items on the premises.
How do you want things covered?
Commercial property insurance plans pay for losses based on the replacement cost of the item or its actual cash value.
Replacement cost (RC) is the amount necessary to repair, replace or rebuild property on the same premises, with comparable materials and quality, without deducting any amount for depreciation.
Actual cash value (ACV) is the cost to replace it with new property of similar style and quality, minus depreciation.
Typically, premiums for policies covering property insured on an ACV basis are lower because the limits only include the depreciated value. This amount might not be enough if you elect to insure the property on a RC basis. We can work with you to make sure you have your property adequately insured.
Your business has a lot of physical assets. Your building and its contents. Any outdoor fixtures like signs or fences. Stuff that can be damaged – which means you need to protect it. That’s why commercial property insurance (also referred to as business property insurance) is one of the smartest investments you can make in your business.
While unexpected accidents or events can happen anytime – storms, fires or other major setbacks – with business property insurance, you’ve got support and financial assistance to help you recover quickly.