Commercial Property Insurance protects your company’s building, machinery, equipment, inventory, and office supplies from fire, explosions, burst pipes, storms, theft and vandalism.
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If you are a business owner, purchasing commercial property insurance is essential. It may even be critical if you are a small business owner or home-based.
If you’re running your business from home, for example, your typical homeowners insurance does not cover you as fully as commercial property insurance does.
Considering the repairs or replacements that your business may need in the future, the risks often outweigh the costs of a quality insurance policy.
Businesses are costly with start-up fees, equipment, etc. and they can become more costly when the unexpected happens such as accidents, damage, or theft. Being prepared with a commercial property insurance policy can provide protection and peace of mind.
What classifies as commercial property insurance?
Commercial property insurance protects your business and your physical assets. Specifically it can protect your buildings, structures, equipment, and inventory. Without insurance to repair or replace these major assets, your business could shut down for quite some time, or even permanently if something unexpected happens.
If your business does need to temporarily shut down due to damage, loss, or remodeling, your policy would protect you and help you keep your business afloat.
Other areas of commercial property coverage include, but are not limited to:
- Records and documents
- Personal property
- Outdoor signs and decorations
- Landscaping and fencing
- Others’ property if it is in your care
To find out what else may be covered with commercial property insurance, you can reach out to an insurance expert at Frost & Remer.
What does commercial property insurance protect my business from?
A commercial property insurance policy can provide coverage for a wide range of incidents.
Weather can be unpredictable and cause significant damage to buildings, structures, vehicles, and property. When you purchase commercial property insurance, damage caused by a storm, such as wind, rain, lightning, hail, tornado, hurricane, etc., will be covered.
In the unfortunate event of a fire, explosion, burst pipe, or looting, rioting, and civil commotion, you and your business may be protected from these damages as well.
The following coverage options provide specific protection based on the risks your business may be exposed to.
Business Owner’s Policy (BOP)
This policy is an excellent option for small businesses. With it, you will receive basic property insurance and general liability insurance.
- Property insurance: This will cover the costs of damage that occurs to buildings, structures, equipment, etc.
- General Liability insurance: You need this to help cover claims of bodily injury, advertising injuries, and medical costs. For example this can protect you if a claim is made against you when a customer has slipped and fallen on your property.
If a customer or employee gets hurt on your business property, it can sometimes turn into a lawsuit. You want to be covered, and in the event of an injury, be in the position to cover the expenses of the injured through your insurance policy.
Some businesses may not be eligible for a BOP if risks are inherent. They instead can purchase each coverage item separately.
Commercial Package Policies (CPP)
This policy is exceptional for a wide range of businesses. Similar to the BOP, it includes property insurance and general liability insurance. However, this policy allows you more customization to meet your specific needs.
With this policy, you may also add the following coverage types:
- Business income insurance
- Business vehicle insurance
- Business crime insurance
- Commercial umbrella liability
- Electronic data processing coverage
- Equipment breakdown
- Employment practices liability
- Inland marine
- Pollution liability
Commercial property insurance has so many add-ons, which ones should I consider in Michigan?
While a BOP is excellent for smaller businesses, you may want to consider adding on to your policy if you run a larger company. In Michigan, some essential add-ons may include flood insurance, business interruption coverage, and electronic data processing insurance.
Flood coverage is excluded from your typical commercial property insurance policy. This add-on protects you and your property if flooding occurs. It could come in handy if you happen to live near water or if you store documents or equipment in a basement.
Business interruption coverage
If your business must be closed temporarily, this will help with lost net income, rent and lease payments, loan payments, taxes, and employee payroll. Due to the many shut-downs that have taken place over the past year, this add-on may seem more critical.
Electronic Data Processing insurance
You receive limited coverage for computer networks with commercial property insurance. Adding this gives you more protection for your computer-related products in the case of something such as a power surge or virus attack.
How Frost & Remer can help
We know that accidents happen and we would like to be there for you if the unexpected occurs. With our expertise and knowledge, we can help you determine the type of insurance policy and range of coverage that is best for your business.
Contact Frost & Remer today to schedule a full risk assessment and get our recommendations on the best policy for your business. We can also discuss your other business insurance needs, such as Worker’s Compensation Insurance and General Liability Insurance.