Commercial Property Insurance Guide

What is commercial property insurance?

Commercial property insurance or business property insurance is a form of commercial insurance that is designed to protect your businesses assets from perils such as fire and smoke, theft and vandalism, burst pipes, explosions and storms. Please keep in mind a standard commercial property insurance policy much like a homeowners insurance policy will not cover flooding or earthquake damage. If these are risks you feel you may run into you may want to ask about earthquake insurance and flood insurance which can be added to your standard policy.

Commercial property insurance helps to pay for repairs or to replace the structure of the building your company is in, the business assets inside the building and outside property as well. Some policies may even cover your business for lost income if your company is not able to operate due to it being repaired. 

Commercial Property Insurance Coverage Options

Commercial property insurance comes in 3 different levels of coverage. Each of the levels will help to protect your company for different risks. Below are the three different levels of commercial property insurance:

Basic:

The basic policy will provide the least amount of coverage from the 3 options. It will cover you for fire and smoke, storms, lightening, hail, explosions, theft and vandalism, leakage, collisions, riots, sinkholes, and even volcanoes.

Broad:

The broad policy will cover the cause of loss that is included in the basic policy, in addition to that it covers damage from leaking appliances, falling objects, ice, sleet, snow and structural collapses. 

Special:

The special form policies will provide you with the most amount of coverage. This policy form will cover damage from pretty much all causes of loss, with the exception of those specifically listed in the policy. The majority of policies will exclude damages from floods, earth movement, war, nuclear disaster, wear and tear and insects. 

Replacement cost vs. actual cash value coverage

You can chose replacement cost or actual cash value when you decide on your commercial property insurance policy, or a combination of both. If you would like full protection you may want to make sure the policy provides replacement cost coverage. 

Replacement cost coverage:

Replacement cost coverage will help to pay to repair of replace your business property at the current value. Which means the policy will pay enough to rebuild the structure of the building your company is in and replace your assets with new items, regardless of if the items are more costly than when you bought them. 

Actual cash value coverage:

Actual cash value coverage will help to pay for the replacement of property minus the depreciated value. Depreciation is the drop in value due to wear and tear and age. Typically with this policy it may not be enough to fully rebuild your company. 

Commercial property insurance add-ons

Your standard commercial property insurance policy will only cover you for certain risks. If you want to go beyond those risks you will want to look into additional coverage to fill the gaps. Below are some of the options you may want to consider:

Earthquake insurance:

As mentioned above earthquake damage is not covered under a standard policy. If this is a risk you believe you are vulnerable to you will want to look into earthquake insurance. 

Flood insurance:

Flooding from heavy rainfall is also not included in a standard commercial property insurance policy. If you need protection from floods you may want to consider flood insurance. 

Crime coverage:

Some crime is covered under a standard commercial property insurance policy but if you want expanded coverage you may want to look into crime coverage. Some of the crimes a crime policy may cover are:

• robbery and safe burglary
• forgery and alteration
• employee theft
• money and securities, which insures money, securities, and other property against losses that happen on or off your business site

Inland marine coverage:

Inland marine coverage covers your property that is on land, not on water. An inland marine policy will cover:

• accounts receivable
• computers
• contractor equipment
• fine art
• property in transit
• valuable paper
• property held for others

Shopping for commercial property insurance

Commercial property insurance rates will vary from insurance company to insurance company, from state to state, and from industry to industry. This is why it may be best to go through an independent commercial property insurance agent such as Eugene C Yates Insurance Agency. Our agents have access to the top commercial property insurance providers and have firsthand knowledge of the best commercial property insurance discounts. This makes it easy for them to get you the best rates on the best coverage available. 

If you would like a custom commercial property insurance quote, please feel free to get in contact with us at 916 313 6100. We have agents standing by to take your call.