What Does Commercial Property Insurance Offer – Owning a business is an achievement. However, several requirements go with running the business. First, of course, we’re talking about the various insurance policies a business owner should purchase to protect himself, his employees, the company, and his customers.
Even if the business is small and the owner operates it from his home, it is vital to purchase commercial property insurance. This form of insurance offers more coverage than standard property insurance. It means that if something goes wrong, your personal property will not be affected by the business issue.
Why purchase commercial property insurance?
Commercial property insurance will protect your assets that are vital to your business, and insurance carriers can customize the policies to match your specific needs. You need protection because even if your business is small, you will still lose a lot if you lose it due to weather events, accidents, fire, or theft.
You can get reimbursed for your damaged or lost property, inventory, and equipment when you have commercial property insurance. It can cover the repair and replacement of particular business assets. It can provide a financial cushion to startups and small businesses that do not have the financial capacity to replace whatever they lost to ensure that their business can continue running.
The coverage commercial property insurance provides
Commercial property insurance is flexible; thus, you can customize it to protect nearly all the physical assets owned by your business. The things commercial property insurance usually covers include:
- Office equipment like special machinery, tools, and computers, including equipment and property that you do not own but are in your custody and care
- Fixtures and furnishings, such as appliances, supplies, chairs, and desks
- Business inventory, including perishable and food items
- Physical office space
As mentioned earlier, even if your business is still home-based, it is practical to purchase commercial property insurance because a homeowner’s insurance policy will not cover damaged or lost equipment you use for business. In addition, many insurance carriers will bundle commercial property insurance and general liability insurance, which is another form of insurance policy you need for your business. The bundle, typically called business owner’s policy (BOP), will come out cheaper for many small businesses than buying them individually.
When you buy commercial property insurance, the insurer usually offers two options.
One is replacement cost, which will pay for the replacement or rebuilding of the property with materials comparable to or of the same quality. The other one is the actual cash value that will be paid according to the current value of the damaged property or the cost to replace or rebuild the property minus the value of the depreciation.
Cost of the insurance
The cost of commercial property insurance will depend on the property’s value, the business location, and the coverage deductibles and limits that you choose.
It is essential to understand that commercial property insurance does not cover all your legal risks. For example, it does not cover vehicles, living plants, water, land, securities or money, outdoor fixtures like signs and fences that are not attached to the building covered by the policy. You can talk to a licensed insurance agent to know which forms of insurance policies you need to protect your business entirely.