commercial building insurance

The Basics of Commercial Building Insurance

September 20, 2022

Your livelihood is dependent on the survival of your business, so it’s imperative that you protect it against any potential threat. For instance, a fire could destroy your business’s warehouse and the contents inside, or a burst frozen pipe could damage important documents and valuable papers. Worse, you could have trouble paying your employees during a loss because your funds are devoted to repairing the damage.

To combat these risks of loss, it’s wise to obtain commercial building insurance.

Commercial Building Insurance

This coverage comes in many forms to suit your specific needs. Before purchasing coverage, take a complete inventory of all your business property to determine how much you need to insure. This important step ensures you will have adequate coverage to continue your business in the event of a covered loss.

What’s Covered?

Here’s a list of the items commonly insured under this policy:

  • Buildings and other structures
  • Furniture, equipment, and supplies
  • Inventory
  • Money and securities
  • Records of accounts receivable
  • Leasehold improvements and betterments you made to the rented premise
  • Machinery/boiler
  • Electronic data processing equipment
  • Valued documents, books and papers
  • Mobile property
  • Property in transit
  • Cargo
  • Satellite dishes
  • Signs, fences, and other outdoor property not directly attached to the building
  • Intangible property
  • Business contingency for suppliers
  • Ordinary payroll
  • Extra expenses as a result of loss

Types of Commercial Building Insurance Policies

Basic commercial building insurance covers losses due to fire or lightning, including the cost of removing property as a way to protect it from further damage. Should you want to purchase more than basic coverage, you can buy a standard policy that provides coverage for extended perils, such as floods, windstorms, hail, earthquakes, acts of terrorism, explosion, riots, smoke, civil commotions, and vehicles that damage your property. Beyond that, coverage for vandalism and malicious mischief can also be included.

Do You Have Enough Coverage?

One of the most important aspects of purchasing commercial building insurance is making sure that you’ve purchased enough coverage to be adequately protected. A typical policy will provide the replacement cost value for your building and the actual cash value for your business property. Replacement cost value is the amount that is necessary to replace or rebuild your building or repair damages with similar materials, without considering depreciation. Actual cash value, on the other hand, is the value of your property when it’s damaged or destroyed. This amount is typically determined by subtracting the depreciation from the replacement cost value.

Bottom Line

Property Insurance HQ understands that determining your business’s value is critical, so we’re here to help. Contact us today at 888.702.1722 to learn more about our property insurance and loss control solutions to protect your business.


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