If you own a business, you know that your property has the risk of becoming damaged. This damage could occur from fire, equipment malfunction, a natural disaster or even theft. Whether your business is in construction, manufacturing, landscaping or something else, it is important to acquire adequate protection against these types of incidents. Fortunately, this form of coverage exists and is known as commercial property insurance.
What Commercial Property Insurance Covers
As its name suggests, a commercial property insurance policy is designed to cover any items that your business owns (including leased property). Here is a close look at the four primary things that this type of policy protects: tools and equipment, interior furnishing, inventory, and the building where your company is located.
Equipment & Tools
The first thing that a commercial property insurance policy covers is all of your tools and business equipment. This includes computers, phone systems, printers, and any special machinery such as bulldozers, incinerators and grinding machines. Most policies also cover leased equipment, although you should verify this with your insurance company.
Commercial property insurance also covers all of the furnishing and fixtures inside your business location. This includes chairs, desks, appliances, (microwave, fridge, etc.) and office supplies (paper, staplers, binders, etc.), as well as filing cabinets, water coolers and fans. Once again, be sure to ask your insurer if your policy covers borrowed furnishings.
In addition to equipment and interior furnishing, a commercial property insurance policy also typically covers all the inventory that your company sells, including perishable food and beverage items such as meat, fish, poultry and dairy products. To protect perishable goods, it may also be a good idea to purchase food contamination and spoilage coverage, which often reimburses businesses when such products become ruined following equipment failures and power outages.
The Physical Building
The final major thing that commercial property insurance covers are the physical building where your organization is located, including leased buildings. Your office building represents a fundamental aspect of your business operations, especially if your company manufactures any type of product (e.g. cars, food, etc.). Your building may sustain damage as a result of incidents such as floods, fires, and break-ins. Be sure to inquire what types of events your insurance policy covers.
Commercial property insurance also generally covers important business documents such as accounting records and contracts with clients. In some cases, exterior property such as signs, fences and satellite dishes may also be covered. It is highly recommended that you acquire commercial property insurance even if your business is based in your home, given that homeowners’ insurance policies do not normally cover lost or damaged commercial equipment. If you own a small business, you may also potentially save money by combining, or bundling, general liability insurance and commercial property insurance as a business owner’s policy.
What Is The Difference Between Cash Value & Replacement Value?
Commercial property insurance policies typically give you the choice of receiving either cash value or the replacement value for damaged or stolen items. Here is a look at the difference between these two options.
If you select a cash value option for your policy, you will enjoy lower premiums. A cash value policy merely pays out what your damaged or lost items are currently worth. Therefore, this may not necessarily be your optimal option if you own a small business because many types of equipment depreciate over time.
A replacement value option for your commercial property insurance policy guarantees that your provider will reimburse you for your lost or damaged equipment by replacing them with brand-new items. Although this option entails higher premiums, it may ultimately prove advantageous if your company owns sophisticated equipment such as internet modems and VoIP phones.
Reach Out To An Experienced Business Insurance Agency
Speak to the experienced agents at Southern States Insurance in Alpharetta, Georgia for more information on commercial property insurance and its benefits. Since our founding in 1992, we have grown to become one of the largest, privately-held independent insurance agencies in the Southeast. We work with nearly every major carrier and are dedicated to helping our clients obtain top-quality insurance solutions. We also aim to form deep, long-lasting relationships with all of our clients.
Our commercial property insurance policies are designed to provide coverage for both buildings and business equipment, as well as furniture and inventory. You can choose to either purchase this type of policy by itself or acquire commercial property coverage by obtaining a business owner’s policy (BOP). Regardless of the size of your business or the industry it is in, you will benefit greatly from commercial property insurance. Call Southern States Insurance today at (888) 971-6304 or contact us online to request a quote.