subject: A Brief Look At Commercial Property Insurance Policies [print this page] Purchasing a commercial property is one thing, but maintaining it efficiently and effectively is another thing altogether, in that commercial properties come with a great number of risks. This applies irrespective of whether you choose to rent it out or whether you end up using it to conduct your own business.
The most obvious risks would include burglaries and vandalism, flood damage, other water damage, and of course, fires. One of the most important things about commercial insurance is that it should offer you protection against not only external damage to the buildings, but also against interior damage. In other words, if a fire did break out, you need to know your insurance will pay for the damage to the actual building, and also for any contents which were destroyed in the blaze. This could include the likes of machinery, electrical equipment, parts and accessories, and general business furnishings.
Most people who have commercial insurance are aware of the fact that one can have your rates reduced providing you're able to meet certain criteria. For example, if you have a fire alarm and smoke detectors installed, most insurance companies will offer you an additional discount. Now, nobody is saying that this is a bad thing, but in some respect, it can also cause unnecessary damage.
Let's just say you own a furniture store, and a small fire breaks out somewhere in the store which causes enough smoke to set off the fire alarm system. This in turn activates the sprinklers, and the minute that happens, all that furniture which is on display is immediately ruined. You're certainly not going to find customers who are prepared to purchase furniture with water damage, unless of course you intend flogging it off for next to nothing at a boot sale. Yes, your fire prevention system has indeed caused a lot of damage, but with that said, at least your losses are rather limited, and if you have a decent insurance policy in place, you won't really have much to worry about.
Another example of where a relatively minor fire can cause extensive damage would be in the case of a store selling electronic parts or appliances. Electronic components and circuit boards are extremely vulnerable to heat, and of course electronic appliances can cost a fortune to replace.
Storm damage is yet another reason why it's essential to have commercial insurance if you own your own business premises. Roofing and perimeter fencing often becomes the victim of strong winds, and while the amount of damage may not be extensive enough to put you out of business, it can still set you back a few thousand pounds.
Of course the level of cover you opt for will depend largely on the nature of your business, together with the value of your property. Ideally, you should have enough cover in place so as to guarantee you that you'll be able to have the premises rebuilt from scratch if the need ever arises. You'll also need to know that you'll receive enough compensation so as to be able to get your business up and running again.
Many business owners simply renew their commercial insurance policies year on year, without ever bothering to shop around for a better deal. Most don't believe just how much money they could end up saving by switching to an alternative provider. Even though a particular insurance company was able to offer you the deal of a lifetime a few years ago, there's nothing to say that several other companies can't offer you an even better package. The golden rule is to always shop around on a regular basis. If you only stand to save a few pounds then by all means don't bother, but if changing providers means you could save a few hundred pounds, then it's certainly something which is worth looking into.
by: Tom Jones
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