☰ ˟
Contact Us Today by Email or Phone
Logo
  • Home
  • Business
    • Business Interruption
    • Construction / Contractors
    • Cyber Liability
    • Commercial Auto
    • Commercial Property
    • Distributors / Wholesalers
    • Employment Practices Liability
    • Executive Protection
    • Financial Institutions
    • General Liability
    • Healthcare
    • Hospitality
    • Manufacturing
    • Marine
    • Real Estate
    • Not For Profit
    • Retail
    • Risk Management
    • Technology
    • Coronavirus in the Workplace - Compliance Consider
    • Transportation
    • Workers Compensation
  • Personal
    • Personal Lines
    • Private Client Services
    • Home and Property
    • Automobile Insurance
    • Boat Insurance
    • Dental
    • Flood
    • Life
    • Personal Umbrella
    • Wind / Hail
    • Valuable Items
    • High Value Item
    • Hurricane Preparedness
    • Yacht
  • Financial Services
    • Employee Benefits
    • Individual Benefits
  • About
    • About Us
    • Testimonials
    • Privacy Policy
    • Terms and Conditions
  • Insurance Center
    • Important Links
    • Frequently Asked Questions
    • Insurance Glossary
  • Client Services
    • File a Claim
    • Customer Service Requests
  • News
  • Contact
    • Contact Us
    • Locations

How Can We Help You?
Home > Blog > What Does a Commercial Property Insurance Policy Cover?
WEDNESDAY, JANUARY 29, 2020

What Does a Commercial Property Insurance Policy Cover?

Commercial PropertyOne of the largest investments for a business is in the actual property. Restaurants, stores, dealerships and other businesses rely heavily on the physical assets of their location. But what happens when that property is lost or damaged?

As much as we’d like to, we can’t control the weather, and it can be hard to predict. If your business is in areas where natural disasters are frequent or likely, it’s crucial to have property insurance.

Commercial property insurance provides compensation if your business’ commercial property is damaged by perils such as:

  • Fire
  • Smoke
  • Wind
  • Hail
  • Lightning
  • Theft
  • Vandalism

Property coverage can extend beyond the structure of the building, as well, to include furniture, equipment, computers, fences, inventory and more. Keep in mind that commercial property insurance won’t cover against everything, and coverage depends on the type of policy. Most policies do not cover floods or earthquakes. If you live in an area where these perils are common, you may want to invest in separate policies for those dangers.

A named-perils policy only covers perils (or incidents) explicitly written on the policy. If lightning is not listed on such a policy, it won’t be covered. The other type of policy is an unnamed perils policy, which protects against both named and unnamed perils.

Difference Between Actual Cash Value and Replacement Cost

There are two ways you can receive compensation for a commercial property insurance claim. The difference between these two values is the amount of depreciation. Actual cash value (ACV) does not account for depreciation while replacement cost value (RCV) does. In other words, replacement cost is the cost of replacing the lost or damaged item while considering normal wear and tear and price changes. For example, say a fire destroys your laptop valued at $1,000. You’ve only had the laptop for two years, and laptops typically last for five. With RCV, you will receive enough money to purchase a replacement of similar or identical type and quality. ACV is a typically less expensive policy, but usually provides less compensation than RCV.

You can also upgrade your RCV with extended replacement cost, which extends the amount of coverage for damage due to a covered peril.

What Does Commercial Property Insurance Cost?

On average, small businesses pay $500-$1,000 a year for commercial property insurance. This varies on a variety of factors, however. There are ways to bundle certain insurance coverages and save money. A business owners policy is useful for small businesses who wish to bundle property insurance and liability coverage. Other factors that affect the cost of property insurance include location, building size, replacement value, industry, claims history and age of the business, credit history of the insured and more.

If you pay a higher deductible, you may pay less in premiums, but this also means you’re paying more out of pocket. Consider the threats your business faces and the replacement value of the structure and its items before deciding between higher or lower deductibles, as well as choosing between RCV and ACV. Each business is different with unique needs and dangers. If you’re unsure of the right path to take with your insurance, speak with an agent.

Is Commercial Property Insurance Required?

Generally, commercial property insurance isn’t required by the state. Many lenders will require you to have a certain amount of insurance, however.

Besides mandated requirements, commercial property insurance is crucial to protect your business. A business is perhaps one of the biggest investments you can make. You don’t want to put years and thousands of dollars into the business just for one accident or disaster to sweep it away.
Posted 10:18 PM

Tags: insurance, commercial property insurance, actual cash value, replacement cost, florida
Share |


No Comments


Post a Comment
Required
Required (Not Displayed)
Required


All comments are moderated and stripped of HTML.

NOTICE: This blog and website are made available by the publisher for educational and informational purposes only. It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state. By using this blog site you understand that there is no broker client relationship between you and the blog and website publisher.
Blog Archive
  • 2025
  • 2024
  • 2023
  • 2022
  • 2021
  • 2020
  • 2019
  • 2018

  • business insurance(36)
  • insurance(32)
  • auto insurance(20)
  • home insurance(15)
  • general liability insurance(14)
  • workers compensation insurance(10)
  • commercial property insurance(9)
  • commercial auto insurance(8)
  • commercial insurance(8)
  • umbrella insurance(6)
  • workers compensation(6)
  • professional liability insurance(6)
  • florida(5)
  • boat insurance(5)
  • bop insurance(4)
  • builders risk insurance(4)
  • homeowners insurance(4)
  • contractors insurance(4)
  • directors and officers insurance(4)
  • general liability(3)
  • miami(3)
  • flood insurance(3)
  • builders risk(3)
  • directors & officers insurance(3)
  • policy(3)
  • auto(2)
  • business(2)
  • car insurance(2)
  • business owners(2)
  • cyber liability insurance(2)
  • construction(2)
  • coverage(2)
  • business owners policy(2)
  • employment practice liability insurance(1)
  • risk(1)
  • file a claim(1)
  • commercial general liability(1)
  • restaurant insurance(1)
  • work place safety(1)
  • policy review(1)
  • constructions(1)
  • accidents covered(1)
  • stress crack(1)
  • replacement cost(1)
  • car(1)
  • water damage(1)
  • insurance tips(1)
  • epli insurance(1)
  • bop(1)
  • year end review(1)

View Mobile Version

Our Customer Feedback

Read More

Our latest blogs

  • Carrier
  • Carrier
  • Carrier
  • Carrier
  • Carrier
  • Carrier
  • Carrier
Tanenbaum Harber of Florida
2900 SW 149th Ave, #100
Miramar, FL 33027-6605

Broward Tel: 954-883-2900
Miami-Dade Tel: 305-620-0200
Jacksonville Tel: 904-807-9121
We've successfully served hundreds of customers and are determined to treat each individual with respect and compassion. Shopping for insurance can be difficult, but our staff does the work for you. Maintain your financial stability and stable coverage by allowing us to help you with your insurance needs.
We're here for you
Home Page/ About Us/ Contact Us/ Our Blog/ Latest News/ Locations/ Join Our Newsletter/ Refer A Friend
Quick Help Links
Quote Forms/ Service Forms/ Claims/ Payments/ Glossary/ FAQs/ Privacy Policy/ Terms and Conditions
Icon Icon
Icon Icon Icon
Social Icon Social Icon Social Icon
© Copyright. All rights reserved. Powered by Insurance Website Builder