Property Insurance

Commercial Property Insurance

Commercial property insurance for business owners covers many types of losses and damages to a companies’ property.

Find affordable commercial property insurance quotes for your building or equipment

Common Coverage Types for Business Property Insurance:

Buildings and Permanent Fixtures
Business Inventory
Furniture and Equipment
Personal Property and Property of Others
Outdoor Signs
Fences and Landscaping
Business Interruption Coverage

In general, property insurance provides coverage for a wide variety of events such as a) fire, b) smoke, c) wind and hail, d) vandalism and e) civil disobedience. Policies often list included or excluded coverages. Some parts of coverage, such as earthquake or hail, may have separate deductibles than other parts of coverage.

Why is the Cost of Property Insurance Increasing in 2023?
  • Claims: 18 disastrers in 2022 coasting over $1 billion each.
  • Cost of Materials: an 8% increase in nonresidential building costs.
  • Labor: over 400k job openings in construction industry.
  • Property and Casualty Insurance

    Property and casualty insurance refers to the various lines of insurance designed to protect businesses from both legal liability and property damage. While commercial property and casualty is similar to homeowners insurance in many ways, there are more details and consideration for potential risks associated with the commercial side.

    Commercial property insurance policies are written in one of two basic forms. First, an All Risk Policy is designed to provide coverage for all types of incidents and perils, except for those specifically excluded on the policy. Second, a Named Peril Policy is designed only to cover incidents and perils specifically listed and included on the policy. Depending on the type of business and its potential risks, one policy may be better suited for your business.
    Commercial property insurance includes buildings, contents, and business personal property


    Property Insurance Rates and Types of Coverage

    Commercial property insurance rates and premiums are typically developed by multiplying the value of the building or contents by a factor associated with the level of risk. Factors that affect property insurance rates include the nature of the business, the location of the property, distance from nearest fire station and other public services, fire and theft alarms and also how the building is constructed. Properties with higher risk of damage or claims will have higher rates per $1000 of coverage than lower risk properties.

    Consider combining general liability insurance and property insurance into one single policy to maximize savings with additional credits and discounts.
    Learn more about a Business Owners Policy and a Commercial Insurance Package.

    There are three common types of property insurance coverage:
  • Actual Cash Value: the value after depreciation.
  • Replacement Cost: the cost to replace the property.
  • Extended Replacement Cost: pays a set percentage above policy limits.
  • Actual cash value coverage is generally based on the value given to the property as listed on the policy. An an example, insuring a piece of equipment for exactly $10,000. Replacement cost coverage will pay the cost of replacing property regardless of depreciation or appreciation associated with the property (only up to the limits listed in the policy). Extended replacement cost coverage will pay over the limits of coverage in the event construction costs have increased. This typically applies to an additional 25 percent in excess over the limits.

    How Much Property Insurance Do I Need?

    The amount of property insurance you need greatly depends on your tolerance for risk and what you are willing to pay for coverage. It’s definitely not a good idea to over-insure your property as you will be overspending for insurance with little to no benefit in the event of a loss. The entire premise of insurance is to make you whole again after a claim or loss. Additionally, banks and lease agreements often stipulate minimal amounts of property coverage required for businesses who have loans or lease buildings.

    How much commercial property insurance does a small business need?
    There are two values to consider when evaluating your property.  There’s the amount of money you paid for it; and there’s the amount of money it would take to replace it. For small items that may be easy and inexpensive to replace, actual cash value coverage is often better and more economical. For property that is more expensive and vital to your business, replacement cost coverage gives added value to your expense.

    The final thing to consider is your property insurance deductible. Be careful about setting your deductible too low when purchasing property insurance. Lower deductibles not only increase the cost of your business property insurance, it’s often not worth turning in a claim on a small loss. Many companies with $500 deductibles don’t turn in claims for $750 losses. Why? Because it’s not worth the extra time and energy to file the claim and wait for a settlement. Additionally, many business owners don’t want the claim on the business loss reports because it may cause their rates to go up at renewal.

    Start a Commercial Property Quote

    It’s easy to get property insurance quotes for your business. Contact one of our commercial insurance Specialists today at 800-900-8657, have a Specialist call you, or start your property quote online. At General Liability Shop.com, we’ve got your property covered. Get quotes from more than 35 insurance companies from a national agency specializing in commercial insurance coverage.

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