The cost of property repairs, as well as replacing equipment and inventory, can leave a lasting deficit on your business for years to come. And for smaller firms, that impact might be financially devastating. So how can you protect your physical property in case disaster strikes? With Commercial Property Insurance! Read on to learn more about what it is, who needs it, what’s covered, and what’s not.

What is Commercial Property Insurance?

Commercial Property Insurance protects your business property and assets from physical loss or damage, such as fire, theft, water damage, and other perils listed in your insurance policy (also known as “covered perils”). If a covered peril causes physical damage to your business, Commercial Property Insurance will help you pay for the necessary repairs and replacements. Keep in mind: that also means you won’t be covered for any damages if a particular event ISN’T listed in your insurance policy.

There are a variety of factors that go into determining the cost of your premium, including location, building construction materials, existing fire prevention and security systems, as well as the risk level of your business operations. Commercial Property Insurance can also usually be bundled with other professional coverages, such as Commercial General Liability (CGL) Insurance.

Who needs Commercial Property Insurance?

Any business that operates out of a physical location in any commercial capacity is at risk for property damage, including offices, storage spaces, and brick-and-mortar stores. That means most companies could benefit from having Commercial Property Insurance to protect the physical assets they rely on to conduct business. And it’s not just for property owners, either—if you rent or lease your commercial space or even equipment, you can (and should!) still consider Commercial Property coverage to protect your business assets.

What if I have a home office?

Commercial Property Insurance might seem unnecessary if you don’t own or operate a traditional commercial space, like an office, factory, or retail storefront. But if you operate from home, your home IS your commercial property—and it has the same risks that any physical workspace would. Whether you have a home office or a full-on home-based business, your work items may not be covered under your personal Home & Auto policy, especially for any equipment taken out on the road or any client materials you store at home.

RELATED: Risky Business: How Can You Protect Your Home-Based Business?

What does Commercial Property Insurance Cover?

Commercial Property Insurance will typically cover any business assets such as:

• Physical building/structure;

• Equipment, tools, and supplies;

• Inventory;

• Furniture;

• Computers and other electronics;

• Business records;

• Outdoor fixtures (e.g. signage, fencing, landscaping);

• Client or employee property onsite;

• And more!

Depending on your specific policy, the following perils may be covered:

• Fire;

• Theft;

• Vandalism;

• Wind damage;

• Water damage;

• And more!

What’s not covered under Commercial Property Insurance?

• Poor Maintenance: Damage to a commercial property resulting from a lack of proper maintenance will typically not be covered under Commercial Property Insurance. This includes insect or rodent damage, rust, mold, and general wear and tear.

• Earthquakes and Earth Movement: Most commercial property policies will exclude coverage for damages caused by earthquakes or earth movement, including landslides and sinkholes. However, extra coverage for earthquakes and earth movements can be purchased if your property is located in a higher-risk area.

• Flooding: Although some types of water damage are covered by Commercial Property Insurance, most policies will exclude coverage for flooding damage. To ensure full protection from floods, policyholders can purchase additional flood coverage.

• Commercial Vehicles: Damage to a commercial vehicle or fleet, a group of vehicles used for business purposes, requires a separate Commercial Auto policy.

• Data Security: Damages from privacy breaches, cyberattacks, and any other unauthorized loss, theft, or use of data are covered by Data Security & Privacy Breach Insurance. Watch our Cyber Insurance video to learn more.

• Claims of Bodily Injury: Clients and third-party vendors that are injured as a result of your products, services, and/or business activities are covered by Commercial General Liability (CGL) Insurance.

• Professional Services: Commercial Property Insurance won’t cover you for any third-party financial losses stemming from professional advice given by your business. For these types of claims, you’ll need Professional Liability Insurance.

Need help finding a Commercial Property Insurance solution for your business? PROLINK will take the time to carefully audit your office contents and ensure that your commercial property, equipment, and furnishings are covered for their full value. We’ll also help you adjust your coverage as your business grows, to ensure that you’re always protected no matter what.

Connect with PROLINK today to learn more!