Buying, maintaining, or dealing in any other way in commercial property is an expensive affair. One simple reason is that the cost is much higher as compared to a residential property. Also, these properties are mostly meant for business purposes which increase the value of the property multiple folds. Whether you rent a property or own one, the risks associated with businesses are high and keep increasing. With increased values come higher risks and the best way to deal with risks is to be prepared by investing in property insurance for commercial purposes. There is an overwhelming array of businesses covering different types and different niches in each type. To accommodate these diverse business types, the commercial properties are available in a huge variety of sizes, shapes, facilities, etc. Each business type and the type of property has specific risks. While you might have taken ample measures to evade several potential risks, many of them are often sudden and impactful. What you can do is to estimate the likelihood and its effect of the risks and invest in an insurance plan that can support you when you are hit. Here are some threats against which the commercial property insurance guard your business.
The premises built with solid bricks and mortar are often considered safe. However, these are challenged by several risk factors including environmental, accidental, and human threats. Some common factors are flood, storm, fire, explosion, earthquake, water escape (pipe bursts, etc), vandalism, short circuit, etc. It is important to ensure that your building is in good condition and has preventive and protective methods installed. For any unexpected aforementioned incident, property insurance provides cover.
- Content and belongings
Setting up a business in a building needs a lot of investment to put together all the necessary content in it. Property insurance plans also have clauses to cover any damage to the content of the building as well. A common content list includes business-specific fixtures and fitting (e.g. well-equipped kitchen for a restaurant), inventory and supplies, machines, plants, documents, etc.
- Public liability
As a business owner, you are answerable to anything that is caused at your premises or due to your business operations. You have to make sure that any visitor, client, or public member is not hurt inside your premises. Also, you have to ensure that the surroundings and neighborhood are not harmed or affected by your business function or negligence on your part. Property insurance also provides cover for any such unfortunate incident.
- Rental liability
If you have taken a building on rent to run your business, you are liable to pay rent regularly within the pre-decide time window and also for any damage that might occur to the building or surroundings. You can look for commercial property insurance that would cover these aspects.
- Interruption in business
Sometimes a major event like an earthquake, flood, can cause a sudden interruption in your business. This can cost you a huge amount until you get back to your feet. Commercial property insurance plans have provisions for such losses. However, it should be clearly understood that only business interruptions due to damage to the property are covered by such insurance plans.