Finding the right commercial insurance can sometimes be difficult. Depending on your business there can be many coverages to consider when deciding on a comprehensive insurance package. Below, we outline a few of the differences between commercial property insurance and general liability insurance to help make the process a little easier.
What is commercial property insurance?
Commercial property insurance is designed to protect businesses against physical damage and losses that can include thefts, vandalism, fires, floods, severe storms, and some natural disasters.
This type of commercial insurance can help mitigate potential losses when your business experiences damage to property, such as buildings, furniture, equipment, tools, supplies, technology, and inventory.
It’s important to remember that commercial property insurance generally doesn’t cover company-owned vehicles or their contents. Businesses that use vehicles for their business operations may want to consider commercial auto insurance.
What are the benefits of commercial property insurance?
From replacing tools after a theft to repairing your commercial property after a storm, this type of commercial insurance has several benefits. These can include:
Recovery following a loss
The longer your operations are sidelined or slowed, the worse the experience can become. The right commercial property insurance policy can help get your business back up and running quickly. By limiting your business’ downtime, you also protect your reputation with your customers.
Repair costs
If your company suffers from a covered loss, your policy is designed to help with necessary repair costs. For instance, if the door to your commercial space is vandalized, stopping customers from entering the building, your policy may be able to help with that.
Replacement costs
If your business suffers a loss that’s too extensive for repairs, commercial property insurance can help with the replacement of the damaged property. For example, if you own a restaurant and a flood destroys the appliances in your kitchen, your policy may help by replacing the damaged property with new equipment.
Business interruption coverage
If you suffer a covered loss, your business will likely have to shut down for some time or reduce operations. Business interruption insurance may help with income that’s disrupted or reduced, so you can keep up with bills, payroll, and other expenses until you’re back on your feet.
Unexpected losses
Despite all your preparations, you can’t always control what happens to your business. Natural disasters, like fires, winter storms, hail, and flooding, can cause sudden property damage. It’s important to be protected if these unforeseen events arise.
What are the types of commercial liability insurance?
Liability insurance can protect your company in the event of third-party claims where your business operations, your company vehicles, or one of your employees caused harm to them or their property.
There are several types of commercial insurance for liabilities, including:
Commercial general liability insurance
Commercial general liability insurance protects businesses from a variety of liability claims and is important for most businesses to have. This insurance may help with the following:
- Claims arising from an injury that occurred on your premises or due to your business operations
- Replacing or repairing a third party’s property if they claim your business operations damaged it
- Legal costs if they arise
Commercial auto insurance
Commercial auto insurance is designed to protect businesses from third-party liability claims arising from an accident with a company vehicle. These liability claims can pertain to physical injuries or property damage.
Commercial auto insurance can also cover the cost of repairing or replacing the company-owned vehicle and its contents in the event of an accident, vandalism, or theft.
Professional liability insurance
Also known as errors and omissions insurance, this type of commercial coverage can help protect professionals who offer services or advice for a fee. This can include professionals like photographers, creative consultants, healthcare professionals, and other people who provide services based on their expertise.
Professional liability insurance may help cover costs arising from provided services or advice that resulted in harm or financial loss.
Product liability insurance
Although some commercial general liability insurance policies include product liability coverage, businesses should always confirm if it’s included. This type of commercial insurance can help cover costs associated with lawsuits that claim harm or financial loss caused by a business’ products.
Pollution or environmental insurance
Hazardous substance spills and environmental remediation can be very expensive. Businesses that produce, use, or transport products or substances that could be harmful to the environment can benefit from having pollution liability coverage.
Ensure you’re protected
To sum it up, commercial property insurance can protect a business’ physical assets from a number of risks, while commercial liability insurance can help mitigate the costs arising from third-party liability claims. More information can be found at our blog.
Federated Insurance offers industry-specific solutions and policy customization that may give you more tailored and comprehensive coverage. For assistance in finding the right insurance for your business, get a quote today.
This blog is provided for information only and is not a substitute for professional advice. We make no representations or warranties regarding the accuracy or completeness of the information and will not be responsible for any loss arising out of reliance on the information.
