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Commercial property insurance provides protection for businesses against financial losses related to their physical assets. Coverage can include buildings, equipment, inventory, furniture, or other properties owned/used by the insured.
Overall, the purpose of commercial property insurance is to help businesses recover quickly from unexpected events that may cause damage or loss of property. Commercial property insurance coverage generally includes:
- Property Damage – Protection against damage to buildings, stock, equipment, and other personal property that is owned or leased by the business.
- Loss of Income – Coverage can include compensation for lost income or profits due to a covered event that disrupts business.
- Extra Expense – This allows the insured to be reimbursed for additional expenses that are incurred by the business to continue daily operations.
- Equipment Breakdown – Coverage for sudden mechanical or electrical failure of equipment that is essential to business operations. This ensures you can repair that equipment quickly and lessen the financial impact on your business.
Before you sign up for commercial property insurance make sure you carefully understand which policies and conditions are included. Usually, insurance professionals will tailor your policy to fit your business’s specific needs.
Why Is Commercial Property Insurance Important?
Commercial property insurance is important because it gives businesses important financial protection that they require. However, there is a list of critical reasons why a business may decide to obtain commercial property insurance:
- Asset Protection – Commercial property insurance coverage ensures that a business can recover financially if the property is damaged or destroyed. This makes sense because businesses often invest a lot of money into their buildings, equipment, inventory, and property.
- Financial Stability – Businesses want insurance coverage that is going to cover the cost of repairs or replace damaged property, especially small and medium-sized businesses that may have limited financial resources.
- Business Continuity – Commercial property insurance allows businesses to resume daily operations after a covered event occurs. It allows business owners to continue paying their bills, dishing out paychecks to workers, and taking care of any other expenses that are necessary to continue business operations.
- Risk Management – This allows the property owner to pass on financial risks associated with property damage to the insurance provider. It allows the impact of unexpected events to be reduced on the business’s overall financial health.
What Factors Determine the Cost of Commercial Property Insurance?
There are multiple factors that an insurance provider will look at when determining the cost of commercial property insurance.
- Property Value – This includes the value of the building, any equipment, inventory, and other assets on the site.
- Location – If your property is located near an area that is prone to earthquakes, floods, or hurricanes, you could see a higher premium. Also, properties near high crime areas could also see a higher insurance premium for their commercial property insurance.
- Occupancy and Use – Insurance companies will look at not only the type of business that you run but how the property is used to assess the risk profile. For example, if your business operations deal with handling hazardous materials, you could face a higher premium.
- Security Measures – If your business has security cameras, an alarm system, or security guards, you could be eligible for a lower premium. These measures show insurers that there is a reduced risk of theft and vandalism.
- Claims History – If a business has a history of filing frequent claims or large losses, it could look like a higher risk to insurance companies.
How Can Businesses Get a Discount on Their Commercial Property Insurance Premiums?
A business might be eligible for a discount from insurance companies by taking specific steps. Here are some strategies that could benefit businesses:
- Safety Practices – Install fire alarms and security systems or hire security guards. All of these measures could make your business eligible for a discount on commercial property insurance.
- Loss Prevention Training – Give your employees training on loss prevention and safety measures. If staff are trained to help prevent accidents, they could reduce the risk of property damage.
- Building Renovations – Think about making some improvements to your building that enhance security and safety measures. You could add fire-resistant materials or enhance the building’s design to be more secure.
- Bundling Policies – If you bundle your commercial property insurance with other insurance policies, you could be eligible for a discount.
- Deductible Choice – You could get a lower premium if you choose a higher deductible. Make sure the deductible is still affordable though, in case there is a claim.
How Can Biscayne Risk & Insurance Help Businesses Obtain Commercial Property Insurance?
Commercial property insurance is a vital safeguard for your business. It offers the protection your business needs in the event of unexpected events that could lead to disruptions or significant losses.
Biscayne Risk & Insurance offers comprehensive commercial property insurance solutions that include covered events such as natural disasters (hurricanes or fires), lightning strikes, vandalism, and theft. Florida businesses will be pleased to know that they can receive coverage for hurricane and wind damage along with flood insurance.
Please contact us to learn more about our business-related insurance policies designed to give you peace of mind and protection. Our team of insurance professionals is waiting to answer any questions and get you set up with our comprehensive insurance solutions.
We look forward to working with you!