Protect your property from damage, loss, and theft with commercial property insurance.
Is your business prepared for the worst?
Fire, flooding, theft, or accidental damage are unfortunate incidents that could not only damage or destroy your property but could also devastate your business. Whether it’s your office building, commercial vehicles, or equipment, losing these assets would be a potentially critical setback for your business.
Replaces lost or damaged property.
A commercial property insurance policy may help protect against the cost of replacing lost or damaged property. Additionally, insurance may cover any associated losses—such as lost income—that are caused because part or all of your business is temporarily unable to operate.
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Building Coverage
Risk Factor
Your business property can feel like it IS your business. Damage to your structure or other property could seriously harm your business.
Solution
Buildings coverage can protect the physical structure of your business and help with repair costs from a covered risk such as fire.
Equipment Coverage
Risk Factor
Your business is more than walls. It is also the equipment you use to operate, and if it was damaged or stolen, you could grind to a standstill.
Solution
Equipment coverage helps to pay for damages or loss to the equipment and gear you use to run your business.
Inventory Coverage
Risk Factor
An accident that causes physical harm can also damage or destroy your valuable inventory.
Solution
Inventory coverage can help you recover from damaged or destroyed inventory after a covered accident.
Exterior Signs
Risk Factor
Storms and other types of risk can also harm the exterior of your property, damaging signs and other valuable displays.
Solution
Exterior Signs coverage protects your important signage and outdoor marketing that helps your business thrive.
Important Records
Risk Factor
Some of the most important parts of your business are the records and documents that prove you’re in business.
Solution
Important records coverage can help with losses from the destroyed papers, records, and files that your business depends on.
What is covered under a commercial property insurance policy?
While coverage can vary depending on your specific policy, a standard commercial property insurance plan typically protects the following physical assets:
- Building Structure: Protection for the physical building you own or lease.
- Furniture and Fixtures: Desks, chairs, lighting, and shelving.
- Equipment and Machinery: Computers, specialized tools, and manufacturing equipment.
- Inventory: Your stock of products or raw materials.
- Personal Property of Others: Items left in your care, custody, or control.
- Outdoor Assets: Fences, signs, and certain landscaping features.
How much does commercial property insurance cost?
The cost of commercial property insurance varies significantly based on the property size and other factors listed below. For many small businesses, commercial property insurance typically costs between $500 to $1,200 annually, while medium-sized businesses can exceed $10,000 to $50,000+ annually.
However, your specific premium will be determined by several risk factors, including:
- Location: Regional risks like high-crime areas or weather-prone zones.
- Building Construction: The materials used (fire-resistant vs. wood frame) and age of the structure.
- Fire & Security Protections: Proximity to fire hydrants and the presence of alarm systems.
- Occupancy: The type of business you operate (e.g., a restaurant has higher risk than an office).
- Size: The size of the commercial property also affects the cost.
Policies may cover additional unexpected costs.
It’s worth exploring the options available to you with a business property insurance policy, as they may cover risks you hadn’t thought of. For example, some policies may protect against the additional costs you face if rebuilding a damaged business facility means no longer being exempt from local building codes. Other points to check include whether a policy covers the cost of removing debris before reconstruction begins, as well as whether the business property is covered against weather event damage while being rebuilt.
Commercial property insurance may help safeguard your business and assets, as well as your income. Contact us to learn more about your coverage options and business needs.
Commercial Property Insurance FAQ
What is the difference between commercial property insurance and a business owner's policy?
Commercial property insurance is a standalone policy that protects your business’s physical assets, while a business owner’s policy, or BOP, typically bundles commercial property coverage together with general liability insurance into one convenient policy. A BOP may be a good fit if you’re looking to protect both your property and your liability under one policy, while a standalone commercial property policy may be better suited for businesses with more complex property needs.
What is the difference between replacement cost and actual cash value coverage?
Replacement cost coverage pays to replace damaged property with new property of a similar kind and quality, without factoring in depreciation. Actual cash value coverage pays the depreciated value of the property at the time of the loss, which may be significantly less than what it costs to replace. The right choice depends on your business’s situation, so it’s worth reviewing your options with a licensed agent.
Does commercial property insurance cover lost income?
Commercial property policies may include business interruption coverage, which can help replace lost income when part or all of your business is temporarily unable to operate due to a covered loss. Waiting periods and how income loss is calculated vary, so it’s worth reviewing the specifics with your agent.
Does commercial property insurance cover flood damage?
A standard commercial property insurance policy does not cover flood damage and must be purchased as a separate policy through the National Flood Insurance Program (NFIP) or a private insurer. Speak with your agent to determine whether you need flood coverage to ensure your property is properly protected.
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Frequently Asked Questions
Does commercial property insurance cover floods or earthquakes?
No, standard commercial property insurance policies generally exclude coverage for damage caused by floods and earthquakes. These are considered specialized risks and require separate policies or specific endorsements. If your business is located in a high-risk zone, we recommend adding a standalone Commercial Flood Insurance or Earthquake Insurance policy to ensure full protection.
Is business interruption coverage included in a commercial property policy?
Yes, Business Interruption (also known as Business Income) coverage is often included or can be added as a critical component of your property policy. This coverage provides financial protection if a covered loss (like a fire) forces you to close your doors temporarily. It helps replace lost revenue and covers ongoing operating expenses—such as rent and payroll—to help your business stay afloat during repairs.
How do I figure out the amount of coverage I need?
To determine the correct amount of coverage, you should evaluate the Replacement Cost of your assets rather than their current market value. Consider the following steps:
- Building Appraisal: Calculate what it would cost to rebuild your facility from scratch at today’s construction rates.
- Inventory Audit: Total the value of your peak inventory levels throughout the year.
- Equipment Valuation: List all essential machinery and electronics and their current replacement prices.
- Compliance Costs: Account for potential costs to bring an older building up to modern building codes during a rebuild.
