What is commercial property insurance?
Table of Contents
- What is commercial property insurance?
- Benefits of commercial property insurance
- How is commercial property insurance calculated?
- Does commercial property insurance cover theft or vandalism?
- What are some business assets commercial property insurance covers?
- More ways to protect your business
- Can we help you prevent claims from happening?
- Other types of coverage to consider
Whether you’re a contractor, you run a small restaurant, or you’re an automotive dealer, you and your employees rely on your tools and devices. You need to protect your property, whether that includes buildings, equipment, machinery, or computers. That’s where commercial property insurance comes in—and we can help!
What is commercial property insurance?
Commercial property insurance can help cover your building if you own it (or if you’re responsible for it, according to your lease contract), but also its contents.
Commercial property insurance can help cover your building if you own it (or if you’re responsible for it, according to your lease contract), but also its contents. From equipment, furniture, and fixtures to tools, machinery, and the property of others, you have a good deal of assets to protect.
Even when your property is away from your business premises – or in transit – you’ll need support. If you suffer a covered loss, the right commercial property policy is designed to help with repair costs and get you back to business quickly.
Benefits of commercial property insurance:
- Recovery following a loss: The longer your operations are sidelined or slowed, the worse the experience can become. If you suffer from an insured peril, the right policy can help get your business back up and running quickly, helping to mitigate the long-term effects of the loss. By limiting your business’ downtime, you also protect your reputation with your customers.
- Repair costs: If your company suffers from a covered loss, your commercial property insurance policy is designed to help with the necessary repair costs. For instance, if the door to your commercial space is vandalized, preventing customers from entering the building, your policy should help get the repairs done quickly and help protect your bottom line.
- Replacement costs: If your business suffers from 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 some of your kitchen appliances, your commercial property insurance policy can 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. The right commercial property insurance policy may replace a source of 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. Your commercial property policy may cover these damages that result from forces outside your control.
How is commercial property insurance calculated?
- Location: Where your business is located can affect the cost of your insurance. For instance, if you operate in an area that’s particularly prone to flooding, your coverage and premium may reflect that risk. The same is true for auto insurance: your premium may be higher depending on where you’re driving, and what you’re using the car for (like transporting goods versus driving yourself to the jobsite).
- Replacement costs: Imagine your business suffered a major loss that resulted in you needing to replace not only the building you operate out of, but everything inside as well. How much would it cost to replace all of these items? That amount may affect your premium amount.
The type of building: Your premium can be affected by a number of things, including the type of construction, public fire protection, and the building occupancy (even the occupancy of others that share the building with you). - Electrical work and plumbing: Water damage can be a major concern, which is why plumbing in your building is a key factor in determining your coverage needs and the cost of your premium. As electrical systems age, they are also more susceptible to things like arcing and short circuits which can lead to fires. Again, this will affect your premiums.
Does commercial property insurance cover theft or vandalism?
Yes, it can cover theft or vandalism, and much more. From fire damage or destruction of your building/its contents to damage caused by falling objects, malfunctioning equipment, to natural hazards like hail damage.
What are some business assets commercial property insurance covers?
Commercial property insurance can insure a broad variety of business property, such as:
- Equipment, inventory and supplies
- Office furniture and fixtures
- Electronics and computers
- Personal property of employees while on-site and customer property at your business site
Commercial property insurance also protects lighting systems, windows, outdoor signs, landscaping and fencing. Even tools and equipment in transit or are used off-site for business purposes may be covered.
More ways to protect your business:
- Comprehensive crime
This feature primarily targets employee dishonesty and theft or robbery by others. It provides coverage for the loss of money and securities due to robbery, burglary, hold-ups and more, whether these occur on your business premises or elsewhere. - Computerized Equipment
Computerized equipment is becoming increasingly important, and more businesses find themselves relying on digital tools. Luckily, we offer specific protection for computerized equipment, like laptops, desktops, and other data processing equipment that can be damaged by things like power surges. - Storage trailer coverage
This coverage is designed for unlicensed trailers used for storage.
Can we help you prevent claims from happening in the first place?
Yes, we absolutely can help! That’s where our Risk Services programs come in.
We like to be proactive at Federated Insurance, so to help solve a problem before it happens, we’ll work with you to help you improve things like security measures and safety management in order to minimize your exposure to risk.
We’ve developed exclusive programs and services to help you enhance workplace and employee safety – a must in any business. Our Risk Services Specialists are available to help you create, implement, and maintain a company safety program and provide you and your employees with valuable safety advice.
When you need help quickly, our Risk Management Assist* service grants you access to our Risk Services Specialists, who can answer a variety of questions on topics including property, auto, and liability loss prevention. They can also provide guidance on any regulatory, legislation, or code requirements your business may be dealing with.
Other types of coverage to consider:
Commercial auto insurance:
Commercial auto insurance can help if you or your employed drivers get injured in a car accident involving your business vehicle. It can also provide replacement car coverage if you need to rent a temporary car for business operations following a covered accident.
Business interruption insurance:
This coverage is designed to help you recover lost business income and cover ongoing business expenses if your business is temporarily closed for repairs due to a covered loss.
Commercial general liability insurance:
Commercial general liability insurance, or CGL for short, can help if you’re found legally liable for bodily injuries or property damage to a third party. It can also offer protection in situations where you or your employees are conducting business offsite.
