Does Business Insurance Cover Rental Property?
What if a fire breaks out and burns down your commercial rental property? What if a thief breaks in? If you are renting space for your small business, then you’ll probably need a commercial property insurance policy. Though you may have some insurance for your business, it’s important to make sure that you are protecting the contents of the building. If a storm came through and destroyed the building, the landlord has coverage to help protect that. However, your landlord won’t be covering the damage to your business’s belongings. That’s where property insurance can help.
What Does it Cover?
Property insurance coverage helps cover incidents fire, vandalism, damage from weather conditions, and other common risks. It often covers things such as your office or manufacturing equipment, inventory, records, and sometimes other valuables or securities. However, keep in mind that there are limits to coverage. It’s important to talk over the details with your insurance agent to make sure that your coverage is sufficient for your business needs.
What Does it Cost?
The cost of coverage can vary depending on a number of factors. These include:
- Location – where is the building located? Are there many natural disasters in the area?
- The Building’s construction – Does the building have newer systems in place? Is it made from fireproof materials? How the building is made can affect insurance costs.
- The Industry – some industries are inherently more dangerous than others. For instance, a construction company is often at a higher risk than a software company,
- Fire and Theft Protection – Are there security systems in place? Are there fire alarms? Even the distance from the nearest fire station may affect costs.
As a small business owner, a popular option is a BOP, or business owners policy. This is a bundle of common coverages that small business owners need. This can include business liability, commercial property, and business interruption coverage. Sometimes this type of bundle can be a cheaper insurance coverage option than buying all the policies separately. With a BOP, you may be able to get coverage for your commercial rental property in addition to other coverages. Note that BOPs usually do not cover professional liability, commercial auto, worker’s comp, or health insurance.
Business Interruption Insurance
What happens if the rental property you are renting gets destroyed? That’s where business interruption insurance may come in handy. This coverage helps cover the expenses and lost profit after an incident occurs that prohibits your business from functioning. For example, if there was a fire that burned down the building and you had to relocate, business interruption insurance may help cover losses that resulted from relocation. Discussing these situations with your insurance agent can help you figure out the best ways to protect your business. Learn more about business interruption insurance here!
What Coverage Do I Need?
The best way to determine what your small business needs is by talking to your agent. Unfortunately, accidents do happen, and oftentimes, they are out of your control. Having coverage on your property is one way you can help protect your business. Each business is different and has different needs. Your agent can help you figure out the best choice for your business.