A lot of small business don’t have to get commercial building insurance because they lease their office or retail space, rather than own it. You don’t need a commercial building policy unless you own the building in which you operate your business out of or are in the process of building it. Commercial building insurance will provide you coverage for what is a very large part of most company’s financial assets, the building or buildings they own. Below is a list of three important questions you must ask your insurance company when securing building coverage.
1) What perils are covered? Perils is the term business insurance companies call the potential dangers that can cause damage or ruin to your building. Possible perils are natural disasters, burglary, theft, vandalism, fire, and water damage. Not all policies are created equal and whether or not a specific peril is covered, depends on the company and policy you choose.
2) What are the coverage limits? Many small business owners make the mistake of insuring for the original value of the building, not the current replacement value. In other words, when the building was built, it may have been worth $100,000. However, in today’s economic climate, the cost to rebuild the building if it were completely destroyed may be much higher than that. Make sure to insure for the current replacement value.
3) Are contents covered? There is a separate policy type called business contents insurance that is specifically formed to cover the materials and assets of the company that are found within the building. However, some building policies will provide some coverage for contents as well.