Business Property Insurance: What It Is, Which Businesses Need It

• Certain accidents. 
• Severe weather events. 
• Natural disasters.

• Get fewer than expected complaints to regulators about their commercial property coverage. 
• Get high financial strength ratings from credit rating agencies, which should mean they have enough money to pay out all their claims. 
• Let you get a quote and make a purchase online so you can get the policy you need fast.

• Businesses that lease or rent space. Depending on the lease agreement, a business owner might be liable in case of a fire or natural disaster. Your landlord might require you to have commercial property insurance.
• Businesses that own their buildings. Your real estate lender might require you to have property insurance too. 
• Some home-based businesses. While homeowners insurance might cover some business expenses, it generally falls short if your office supplies, equipment or materials are worth more than $2,500.

• The building itself.
• Business personal property, which includes items like work equipment, furniture, computers and inventory.
• Others’ belongings within your workplace.

Basic causes of loss

• Fire or smoke.
• Lightning.
• Explosions.
• Windstorm or hail.
• Riots or civil commotion.
• Aircrafts or vehicles crashing into the property.
• Vandalism.
• Sprinkler leakage.
• Sinkhole collapse.
• Volcanic action.
• Glass breakage due to one of the above perils.

Broad causes of loss

• Falling objects.
• Weight of snow, ice or sleet.
• Water damage from leaking appliances, but not from sump overflow.
• Building collapse.

Special causes of loss

• Losses in transit: Commercial property insurance typically covers losses on or near the insured company's location, but not losses that occur in transit or off-site. For that, you’ll need inland marine insurance.
• Burglary: Most policies cover damage due to vandalism, but not theft. For that, you may need commercial crime insurance.
• Flood and earthquake damage: If your business operates in an area at risk of earthquakes or floods, consider buying these insurance policies separately.
• Cybercrime and computer fraud: Instead, you’ll need cybersecurity insurance.
• Damage to vehicles: Commercial auto insurance protects cars you use for work.
• Loss due to employee dishonesty: Business owners must purchase a separate employee dishonesty policy or fidelity bond to protect against these losses.
• Income loss: If a business closes while you rebuild after damage, it could lose significant income. Business property insurance doesn't cover this, but business income insurance does. Business owner’s policies usually include business income insurance along with property coverage.
• On-site injuries: You’ll need general liability insurance if a third party, like a customer, gets hurt on your business’s property. (This coverage is also in a BOP.) If it’s an employee, that’s workers’ compensation.  

• The value of your building or property: The more a building is worth, the higher the premium.
• Building construction: Newer buildings built with fire-resistant materials and up-to-date electrical systems are less expensive to insure than older buildings.
• The value of your physical assets: A business with few physical assets of value will tend to have a lower monthly premium.
• Level of coverage: If a business owner selects a special causes of loss form instead of a basic or broad one, they will probably pay higher premiums.
• Actual cash value vs. replacement cost coverage: Premiums for actual cash value insurance tend to be cheaper because they offer less coverage.
• Industry: Manufacturing businesses carry a higher level of risk for property damage than office-based businesses, for example. 
• Location: Your rate can depend on your location's crime rates, proximity to a fire station and fire hydrant, and frequency of dangerous weather events.
• Security: If the business has a security system, you might save money.