Article by Graham McKenzie
Commercial building insurance is insurance that is designed for a business. That means, it is insurance that makes sure there is coverage for commercial buildings, in case of a loss. This loss might result from things like vandalism, fire and natural disasters. When setting up your commercial building insurance, it is important to know exactly what you are getting. Some plans cover only property structure. Others include coverage for furnishings and equipment. Some even cover personal injury or death that occurs on the premises of your business.
When checking into commercial building insurance, you will see that it is normally divided into two types of insurance coverage. There is the named-peril policy, and also an all-risk policy. In essence, the coverage is exactly what the name specifies.
A named-peril policy will protect your property in the event there are unforeseen calamities of a specific nature. These events will be clearly designated in the policy document. A named-peril policy could conceivably cover damage that results from fire and explosions. Alternatively, it might include flood damage and earthquakes. However, because this policy only covers explicitly listed risks, you need to be sure you have included the exact kinds of risks you want covered for your specific business.
In writing up a named-peril policy, a list is generated of potential damage causes. These perils will then be listed, and there will be a clause stating any damage caused by something not specifically listed in your policy, will not be covered.
Named-peril coverage is different from an all-risks coverage policy. An all-risks coverage plan protects the business against all potential sources of damage. However, there are usually designated exclusions. Floods and earthquakes are generally the two things most policies exclude. On the other hand, you can add these as riders to your all-risks policy, if you want to do so. An all-risk coverage policy has an advantage in that it covers all the unexpected disasters, whereas the named-peril policy does not.
It covers much more, so an all-risk coverage plan tends to be more expensive. However, for most businesses, a named-peril plan is sufficient. Business owners simply add riders to cover the extras, if they so desire. Only the business owner knows his or her insurance needs. They depend on the location of the business, and the property and equipment you need protected.
Because there are a variety of companies and packages, most business owners can make a satisfactory purchase on a small business package that meets their individual needs. It is important to determine exactly what you want to insure, and for how much. Take stock of your business property, figure out the value involved, and then make a decision on what is worth the cost of insuring. Do not forget to factor in the buildings involved, equipment and machinery, inventory you may have on hand, documents and business records, and this includes all the databases and vehicles used in the business.
About the Author
Graham McKenzie is the webmaster for a leading South African Commercial Insurance provider. For more information visit: http://commercial.insurance123.co.za/
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The process of acquiring property insurance policies for commercial buildings is discussed in this video by Los Angeles, CA based insurance broker of 10 years Alex Rostamian. Take note of specific details that will aid you in the process of buying commercial property and leveraging yourself so that the property will qualify for a reasonably priced insurance policy.