Commercial property insurance protects the physical assets your business depends on, your building, your inventory, your equipment, your furniture, and your tenant improvements. Without it, a single fire, storm, or burglary can end an otherwise healthy operation.
What is commercial property insurance?
A commercial property policy covers damage to the physical property your business owns or leases, caused by covered perils such as fire, theft, vandalism, wind, and hail. Coverage can be written on a named-perils or all-risk basis, with optional endorsements for equipment breakdown, ordinance or law, and business interruption.
Why you need it:
- Required by virtually every commercial lease
- Required by lenders financing the building or equipment
- Replaces inventory, equipment, and improvements after a covered loss
- Pairs with business interruption to replace income while you rebuild
- Pairs with general liability to form a complete commercial package (BOP)
What it typically covers:
- Buildings (if owned)
- Business personal property- inventory, equipment, furniture
- Tenant improvements and betterments
- Outdoor signs, fences, and fixtures
- Equipment breakdown (often optional endorsement)
- Business interruption (often optional endorsement)
Common exclusions:
- Flood – requires separate commercial flood policy
- Earthquake – requires separate endorsement or policy
- Wear and tear, neglect
- Some losses to outdoor property without specific endorsement
Frequently asked questions:
Do I need commercial property if I lease my space?
Usually yes, commercial property protects your contents (inventory, equipment, improvements). Your landlord’s insurance covers only the building shell.
What is the difference between replacement cost and actual cash value?
Replacement cost pays the cost to replace damaged property with new property of like kind. Actual cash value pays replacement cost minus depreciation – often substantially less. We recommend replacement cost coverage wherever available.
Should I bundle commercial property with general liability?
If you qualify for a BOP, bundling is almost always cheaper than buying property and GL separately. We will quote both ways and let you compare.