Given that commercial insurance can be
complicated, you need to feel free to go over any terms, conditions,
or concepts that are cloudy to you with your broker-agent. It is
a broker-agents service to answer the questions you have and to help
you comprehend the insurance coverage you are acquiring.
Even while your business may not require all commercial coverage lines,
it’s a good idea to possess a basic knowledge of the types of insurance
coverage available. While your business changes and grows you
will have the necessary knowledge to purchase insurance coverage
as new exposures arise. The following commercial lines of insurance
protect broad areas of exposure present with most business operations:
Property Insurance
Commercial Property
Inland Marine
Boiler and Machinery
Crime
Casualty Insurance
Commercial Automobile
Commercial General Liability
Commercial Umbrella
Workers Compensation
Commercial Property
Coverage Sections, Limits of Insurance, and Coinsurance
equipment may also be insured as a part of building coverage. The
limit of insurance coverage is the projected amount needed to rebuild your
building and to replace permanently installed fixtures, machinery,
and equipment in the case of a total loss. You are required under
the insurance policy to fully insure the value of your structures.
If a building is not insured to value, you can be subject to a monetary
penalty at the time of a loss. This penalty is often referred
to as coinsurance. It is very important to read and understand the
coinsurance clause of your commercial property policy and to
go over any kind of concerns with your broker-agent.
Business Personal Property is made up of furniture; fixtures, machinery,
and equipment not permanently set up; inventory; or any other
personal property owned by and utilized in your business.
Personal Property of Others refers to property that’s in your
businesss care, custody and control. The sort of business you
operate will determine if you need to safeguard the personal property
of others.
Covered Causes of Loss
Whether or not a property loss is covered is determined by the policy
language, exclusions, and endorsements. Coverage Forms and Endorsements
There are numerous coverage forms and endorsements in addition to
the basic property coverages by now discussed which can customize
coverage in a commercial property insurance policy. What follows
are the most common coverage forms and endorsements used in
commercial property insurance:
Builders Risk – Added to an insurance policy for a one-year minimum
term to cover a new building or structure under construction or
an existing structure undergoing additions, alterations, or repairs.
Cancellation is allowed on a pro rata basis upon project completion;
but, midterm cancellation will result in a short rate
penalty. on personal property inventory throughout a designated period of
time. This is exclusively used to protect fluctuating inventory
values before and during peak shopping seasons.
Inflation Guard – Automatically modifies the limits of insurance
to keep up with inflation. The modification can be tied to the
construction cost index within a regional area or a specific percentage
per year. This particular endorsement can be extremely essential in assisting to
preserve sufficient coverage limits, that can protect against
possible coinsurance penalties in a property loss.
Time Element – Insurance that covers additional losses arising
from a direct loss by a covered peril to business property.
Business interruption, additional expense, and loss of rents and rental
value tend to be the most common time element coverages. Business
interruption coverage replaces lost business income after a covered
loss. Certain key employees may be named, permitting the employer
to continue to pay their salaries until the business restarts operations
after a loss.
Monument Commercial Insurance Agency is a Multi-State Licensed, Bonded, and Insured Insurance Services Firm offering a complete selection of Business Insurance and Personal Insurance Policy Services.
What is covered in a typical business owners insurance policy? Liability insurance coverage and businessowner coverages needed are described in this video by ISU Insurance Services – The Olson Duncan Agency of Torrance, CA.
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