Commercial Property Insurance Fundamentals
Every business owner should understand the fundamentals of commercial property insurance. You might assume that you only need it when you have a large facility or multiple buildings on your property, but every business owner should consider investing in commercial property insurance. Here are some of the things that you need to understand.
Commercial Property Coverage Applies Even For Home Businesses
If you have put off investing in commercial property coverage because you own a home-based business and assume that your homeowner's policy will cover any potential losses, you might be surprised. Homeowner's policies tend to exclude any type of business-related losses from the policy because the home policy is a residential one. If you operate a home-based business, you need to have a commercial property insurance policy to cover the company space.
Several Factors Affect Commercial Property Insurance Costs
Before you call for a commercial property insurance quote, you should understand the fundamentals of what affects the policy premiums. For example, the age and construction of your building will affect your policy. In addition, the location of the property matters as well. If you are in close proximity to a river, landfill, or environmental hazard, this can affect your premiums. In addition, the crime rates associated with the area factor into your premiums, too. Finally, the carrier will consider how the property is used, including the type of business you operate and any inherent risk factors associated with it.
You Can Mitigate Your Costs
Any steps you take to minimize losses will help you minimize your policy costs. For example, installing central monitoring alarms for break-ins, fire, and plumbing issues will help you get premium discounts. Additionally, added security, structural improvements, and safety training can also contribute to reduced premiums. Your insurance carrier can help you explore any potential savings opportunities that might apply to your policy and your company's property.
There Are Exclusions
One thing that many business owners overlook is the fact that every commercial property policy comes with some coverage exclusions. Take time to review the declaration page and the exclusions with your carrier to confirm that you have the coverage that you need. Sometimes, additional riders can provide you with coverage to address some exclusions, so call your carrier if you have any concerns.
The more you understand about your commercial property insurance, the easier it is to ensure that you have the coverage that your business needs.