Buying Your First Insurance Policies: A Guide for Everyone

Does Your Business Need Commercial Property Insurance?

Do you own a piece of commercial property? Maybe, you have an entire portfolio full of office blocks and commercial units? Whatever your requirements, one thing you can't afford to ignore is commercial property insurance. Buying the right insurance is essential to protect you and the business if something disastrous happens. Whether you are responsible for a large development or a single lock-up garage, you must have the right insurance. Here are three things to consider before you take out commercial property insurance.

Do you need commercial property insurance?

You must understand whether you need commercial property insurance or whether another type of insurance policy would be more appropriate. Commercial property insurance is the right choice if a business operates from the property you want to insure. The business could be anything from a restaurant to a medical clinic or an office. All of these facilities are considered commercial ventures and require commercial property insurance.

What would commercial property insurance cover?

The principal purpose of commercial property insurance is to provide you with cover and protect your business if something unexpected happens to the building. Perhaps, an electrical fault could cause a fire that destroys the property and all the stock on the site. It would also ensure that you could cover the cost of repairs from a burst pipe or damage caused by a burglary. You must check the terms of any policy you buy, but most commercial insurance policies will also provide cover for subsidence, storm damage, and even the effects of rioting.

What level of cover do you need?

Commercial property insurance is divided into cover for physical damage to the building and loss or damage relating to any stock held in the building. The level of cover that you consider acceptable will depend on several things. Work out the cost of completely rebuilding the property in the event it is destroyed by a fire or becomes uninhabitable because of subsidence. You must also place a value on the stock held on the site. Another consideration that is sometimes forgotten is the value of any furniture, machinery, or equipment on the site. Understanding the combined total value of all these things should tell you the amount of commercial property insurance you should be considering.

Is there anything that won't be covered?

Every insurance policy will have exceptions, but specifically, you may find that commercial property insurance can't be used to replace equipment that is worn out or to repair buildings damaged by a lack of maintenance. Always read your policy carefully before agreeing to the terms and conditions.