Commercial property insurance helps businesses pay to repair or replace buildings, associated structures and contents damaged or lost because of fire, storms, theft and other events outlined in the policy.
Commercial property policies provide either "replacement cost" coverage, "actual cash value" coverage or a combination of both. Replacement cost coverage will pay to replace your property with new property of like kind and quality, up to the policy's dollar limit. An actual cash value policy will pay the replacement cost of the property minus depreciation due to age and normal wear and tear. Although replacement cost coverage is more expensive than actual cash value coverage, it might better ensure that your business fully recovers after a significant loss.
As a side note, commercial property policies generally don't cover building contents belonging to a tenant. If you rent or lease your building, you should buy your own tenant policy to insure your on-premises property, including machinery, furniture, and merchandise. The cost of tenant coverage will generally be significantly less than building coverage because the policy will only cover contents, not the building itself.
Almost all commercial property policies have a "deductible," which is the amount you must pay toward the cost of a claim before the insurer will pay. The higher your policy's deductible, the lower your premium should be. Keep in mind, however, that with a higher deductible you'll have to pay more out of pocket if you have a claim. Your policy will also have a "policy limit," which is the maximum amount the insurer will pay for any covered loss.
Typically, business owners can buy a single policy to cover businesses operating at multiple locations. However, you might need separate policies if some locations serve different functions and have different risk profiles. This could be the case, for example, if your business has an administrative office and a separate factory.
We can help explain all of this in detail and customize it for your specific needs. Give us a call today.