Know Your Commercial Property Insurance Policy

Commercial property insurance covers your business property and equipment in case of damage or destruction. Specifics of what is covered and from what causes of damage vary with the individual policy and with individual insurers. The following are typical types of coverage in commercial property insurance.

How Broad Is Your Coverage?

Commercial property insurance typically will fall into two general categories:

  • Named Perils - This type of policy will specify causes of damage to your commercial property and cover only damage resulting from those causes. An example of named peril coverage would be fire insurance. If you had only fire as a named peril, damage caused by a storm or high winds would not be covered.
  • All Risk or Broad Coverage - An all risk policy, which is more expensive, provides coverage for damage from any cause that is not specifically omitted.
Both types of policies typically offer coverage that pays for business interruption and lost revenue.

Loss From Theft

There are many ways for a business to be harmed and require insurance coverage beyond damage from a peril such as a fire, storm or accident. In the all risk type of policy, a business owner is typically covered from loss due to burglary or robbery.

This coverage usually includes damage related to break-ins. You also can add coverage to your commercial insurance policy to protect payroll and payroll transfers.

Broken Equipment

Business equipment, after property and structures, often is the most valuable physical asset an enterprise owns. Commercial property insurance can be structured to cover repair or replacement of damaged business equipment, even if it is damaged during maintenance.

Electronic equipment can also be covered, but this coverage most often is offered in an additional policy or an addendum to an all risk policy.

Signs and Goods

Businesses can be damaged by signage being knocked out. Commercial property insurance can also cover signs to include signs on glass on the building, exterior signage affixed to the building and free-standing signs on the property.

Additionally, when a business puts goods in transit, the potential for loss due to theft or accident is increased. Commercial property insurance can be structured to cover this as well.

Liability Protection

Any commercial insurance policy or package of policies should include business liability protection. Whether it is an employee injured on the job, a customer injured at your place of business, or a non-involved person impacted by your employees or goods in transit, a business owner needs coverage for potential liability from accidents or damage.


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