Commercial Property Insurance

Commercial property insurance is coverage that protects a policyholder’s business assets, like commercial buildings, furniture, and equipment from losses resulting from disasters such as fire, burglary, burst pipes, etc.

Insurance for commercial properties is designed to minimize the cost that policyholders must bear in the event of a tragedy covered under the policy.

Obtaining insurance for commercial properties is a great way for policyholders to transfer the financial risks relating to damage or loss of property to an insurer.

Specifics of commercial property insurance

Different commercial property insurers offer different terms for coverage. However, insurance shoppers should ask for the following details:

• Coverage – outlines the incidents, damage, and costs to be covered.
• Monthly premium – the sum a policyholder pays to retain the coverage
• Deductible – the sum a policyholder must pay towards their claim before coverage settlement.
• Policy limit – the maximum amount the insurer will pay for a filed claim.

Coverage options

Although different commercial property insurers offer diverse coverage, the key features of commercial property insurance are similar among underwriters.

Here are the most common coverage options:

Commercial building insurance

This is the most important feature of commercial property insurance. The policy precisely names the building that is covered, as well as immovable fittings or equipment contained in the building, e.g., electrical systems, cabinets, etc.

Related structures

Warehouses, sheds, garages, and other buildings belonging to the commercial building proprietor can also be included in a commercial property insurance cover.

Related buildings are not automatically added to a policy, and the policyholder and underwriter must agree to name such buildings as covered under the policy.

Personal property

In most cases, damage to a building where a business operates causes damage to other property that the business keeps in that building.

Insurance for commercial properties can issue policies that include assets such as furniture and computers that are housed in a building covered by the policy.

Additional coverages

Quite often the damage suffered goes beyond the standard coverages in a commercial property insurance cover. For example, if your building catches fire, the standard policy covers repairs to the building or payment for the damage.

RELATED: Construction Insurance, Explained

However, it does not cover expenses relating to the removal of debris or other services that are not part of the coverage – unless additional coverages have been acquired.

Most commercial property insurers will make it easy for you to combine additional coverages with your main commercial property insurance policy.

Coverage exclusions

Commercial property insurance companies are profit-oriented businesses and it is in their interest to minimize their risk levels. As such, their coverages exclude incidents that are hard to predict or difficult to compensate for.

Some of the most common exclusions include disasters like hurricanes, floods, earthquakes, and termite infestation, as well as riots and acts of terrorism.

Best commercial property insurers

If you are looking for underwriters who offer insurance for commercial properties, here are some of the best companies to consider (based on user reviews).

1. Nationwide

Nationwide provides commercial property insurance policies that may include endorsements for related risks such as property in transit, breakdown of equipment, losses incurred as a result of employee fraud, etc.

The company is ranked among America’s largest commercial property insurers, with its commercial line business writing over $8 billion in premiums annually.

Nationwide’s range of coverage, along with its client-oriented reputation and outstanding claims management, makes it a great choice for property insurance.

2. Travelers

Travelers is America’s largest commercial insurer – writing more than $18 billion in premiums annually. The underwriter offers highly customizable commercial property insurance policies to both small and large businesses.

The insurer takes a technology-based approach to managing claims – allowing policyholders to initiate claims and receive updates via a website and mobile app.

Travelers’ range of coverage, along with its strong claims management system, makes it an excellent provider of commercial property insurance.

3. The Hartford

The Hartford provides commercial property insurance coverage for businesses of all sizes, from solo entrepreneurs to giant organizations.

The insurer, which offers highly customizable policies, usually provides special coverage for organizations with insurable value that exceeds $200 million.

These covers are designed with open-perils policies that also include access to its risk engineering crew to identify risks and help the policyholders avoid losses.

The Hartford is highly recommended for small businesses, as well as large organizations looking for affordable and reliable commercial property insurance.

Join 15,000+ pros getting our weekly digest of news and insights.