5 Things You Can Protect Yourself From With Commercial Property Insurance

January 12, 2023

You need commercial property insurance if you own a premise-based business like a restaurant, bar, nightclub, shopping, or retail center. The insurance protects you from various perils, including natural disasters, accidents, spoilage, equipment breakdowns, and criminal activities. Commercial property coverage pays for various damages and protects your business from going bankrupt. Here are five things you can protect yourself from with property insurance:

1. Natural Disasters

A natural disaster like a flood, landslide, or storm can devastate your business and destroy property. Disasters can also cause long-term business interruption and loss of income. If a tornado, hurricane, flood, or wildfire destroys your property, commercial property insurance can cover the cost of repairs and replacements. The insurance covers the building, property/assets, inventory, and interruption.

Business property insurance pays for damages to the structure, chairs, tables, kitchenware, computers, registers, and everything inside the building. Inventory insurance pays for damages to the inventory, including perishable and non-perishable items. Business interruption policies cover payroll expenses and lost income caused by the downtime experienced during an interruption.

2. Equipment Breakdown

Commercial property coverage can protect your primary equipment if you own a hospitality business, like a restaurant or nightclub. Such companies rely on various equipment, including freezers, ovens, refrigerators, and dishwashers. Malfunctions and breakdowns in business equipment can result in downtime and lost income. Repairing and replacing damaged equipment can also set you back thousands of dollars.

Business property insurance coverage can pay for repairs if your equipment breaks down due to flood, vandalism, and power surges. Make sure you read all parts of the policy, especially the named and unnamed perils. The insurance can also replace stolen equipment or those damaged beyond repair. You’ll encounter unique types of property insurance policies, including earthquake, flood, crime, hurricane, and rent loss insurance.

3. Crime & Accidents

Accidents can happen at any commercial property regardless of the level of precautions taken. Commercial property coverage will pay the cost of repairs if the accident isn't attributed to employee error or negligence. Examples of covered accidents are kitchen fires that stem from power surges or equipment malfunction. Property insurance can also protect your business from robbery.

If your business incurs losses due to forgery and information alteration, employee theft, or cybercrimes, property insurance can step in. You’ll need property insurance with crime coverage for such incidents. Property insurance can also feature money and securities coverage to protect your hard cash, securities, and other property. Crime insurance can protect the business from crimes within or away from the business site.

4. Spoilage & Damages

Business property insurance can cover perishable and non-perishable stock from spoilage and damage. If you own a restaurant, food truck, bar, hotel, retail, or catering business, your inventory is always at risk of damage. External elements like heat, bacteria, and equipment breakdown can spoil food. Hospitality outlets may also face spoilages caused by food contamination and damage from accidents, floods, fires, and other incidents.

Business property insurance can cover the cost of replacing the spoilt/damaged stock. The spoilage or damage must not be attributed to employee error or negligence. Insurance may potentially cover spoilage stemming from expiry during low seasons.

5. Legal Costs & Liabilities

Some insurance providers combine commercial property and general liability policies into a business owners policy (BOP). If you purchase BOP insurance, the coverage will pay for various liabilities and legal costs. You can use the insurance to pay for court proceedings, lawsuit settlement, and related fees. Most commercial property coverages include legal costs within the policy, but not all pay for liabilities.

You'll need extra coverage for liabilities like bodily injuries and death on your property. If you have BOP insurance, review the basic policy to determine what liabilities are covered. BOPs can protect your business assets and income from costly litigations if third parties like patrons sue your company. Each policy protects your business to a given extent, so you should review what’s covered and left out. You can purchase extra coverage for more protection.

Try Commercial Property Insurance for Bars, Nightclubs, & Restaurants

Business property insurance is one of the most common policies. All companies need the best commercial property insurance to protect them from all identifiable risks. Stick to reputable insurance providers that specialize in serving various businesses. Customize the coverage to suit your commercial enterprise.



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