Property Insurance

What Does Property Insurance Cost?

The best thing about purchasing commercial property insurance, whether it be stand-alone or through a package, is how customizable it is, therefore you’ll never pay for more coverage than you need. That is, provided you are working with a knowledgeable agent who can guide you through identifying your exposures and building coverage for them. When insurance carriers are appraising risks at your business they are generally looking at the following factors:

• Size and location of your business.
• Is your business in a high-crime area?
• Do you have a large, multi-level office space? Or just a single office on one floor?
• Do you have many employees or just a few?
• Safety and security at your business.
• Do you have safety policies in place? And do you train your employees in using them?
• Does your building have a security system or third-party security company that monitors the premises?
• Does your business handle toxic materials, as in a dry cleaning business?
• Age of building and equipment.
• Is your building up to code? Older buildings may need regular inspections to prevent fire or damage from things like old wiring or foundation shifts.
• Is the equipment you use out of date? The newer your technology the safer it is evaluated to be.
• Replacement value vs. actual cash value.
• Depending on how you want to be reimbursed, either for the cost to replace your property entirely or the just for the depreciated value of the property lost, your coverage premium can vary quite a bit.

As always, when you bundle, you save. The more lines of insurance a carrier can write for one customer, the better their rates will be. The carriers know, statistically, that you will not have a claim on every coverage you buy in a single policy period, so they can bank most of your premiums for use when you, or others, do have a claim. The Insurance Shop partners with many nation-wide carriers who write these policies every day. Let us help you shop for the right coverage, right package, and right premiums today.

What are Common Property Claims?

The first step to take when you think you have a claim is to call your agent. Your agent will help you organize your information and guide you through calling the insurance carrier who will process your claim. The following are the top five property and liability claims for small businesses as reported by The Hartford¹ (2015):

1. Burglary and theft
1. 20% of claims.
2. Average cost to business owner: $8,000.
2. Water and freezing damage
1. 15% of claims.
2. Average cost to business owner: $17,000.
3. Wind and hail damage
1. 15% of claims
2. Average cost to business owner: $26,000.
4. Fire
1. 10% of claims
2. Average cost to business owner: $35,000.
5. Customer slip and fall
1. 10% of claims
2. Average cost to business owner: $20,000.

¹The Hartford Newsroom

How Can I Reduce my Risk?

Reducing risk of property loss in your business can be as simple as locking doors and doing monthly inspections. There are some more measured steps that you can take to mitigate more specific risks. For example, to try to prevent burglary and theft a business owner should conduct proper background checks on all employees, invest in some level of a security system, put up fences and gates around company property and install sufficient interior and exterior lighting. Other hazards like inclement weather, fire, water damage and freezing damage can be mitigated as well through employee training, maintaining the landscape, alarm systems and emergency drills.

Frequently Asked Questions

1. What is the difference between property insurance and general liability insurance?

Property insurance only protects the material objects a business owns by paying to either repair or replace damaged goods after a covered event. General liability covers the expenses resulting from third-party bodily injury or property damage on your business property.

2. Does property insurance cover my laptop that I take to meetings with me off-site?

Commercial property insurance may pay to repair or replace laptops used off-site. The best way to make sure all your specific exposures are covered is to meet with an experienced agent who will ask the right questions and assure your policies are written just how you need them.

3. If I rent my building used for business does my landlord have to provide me any coverage?

Landlords are required to insure the physical structure in which they rent. They are not required to provide or extend any coverage to their tenant’s belongings. Before signing a lease, it is a good idea to ask the landlord what kind of insurance is covering the structure. For example, while they aren’t required, some landlords may take out extra coverage for events such as fire or flood, but you will need to add coverage for debris removal.