Do you own a business premises? Whether it’s your own company or you have tenants, you’ll need to think about commercial property insurance. Here’s the lowdown.
If you own a building from which a business operates – whether that’s your own company or someone else’s – it’s deemed a business premises. You’ll need to protect the bricks and mortar of that building to keep your income safe.
There are two types of commercial property insurance – buildings insurance and contents insurance.
Buildings insurance will cover the rebuild or repair of the building. It will make sure you’re protected in the event of: • burst pipes • flood • fire • riots • storms • subsidence • theft To work out how much to insure your building for, use the Building Cost Information Service Contents insurance will cover you for what’s inside the building, such as equipment or stock. If it’s not your business, then contents insurance will be your tenant’s responsibility. Depending on the type of building it is, you may have fixtures and fittings that don’t ‘belong’ to the building but aren’t stock either. If you choose buildings insurance, you can opt to protect these too.
If you own the building outright, you aren’t legally required to have buildings insurance but it’s a good idea. If you have a mortgage, you may well find it’s a condition of the loan.
If you suddenly find yourself holding extra stock – perhaps in the run-up to Christmas, or say you have a big delivery pending – don’t forget to call your insurance provider and update your policy to make sure you’re covered.
If you let a commercial property and something happened that meant your tenants could no longer rent your property, you’d lose valuable income. One solution is to add loss-of-rent cover to your commercial property insurance. Depending on your policy, this essentially means that you’d still get a monthly rental payment, even if you had no tenant. Obviously, there are terms and conditions, so read your policy carefully.
It’s also worth thinking about business interruption insurance, which covers you if damage to your building means you can’t do business there. You can add it as an extra to your buildings or contents insurance.
Every business is different, so there are plenty of company types to choose from when you compare business insurance with us. We’ll ask about your business and explain the different types of cover. According to the Association of British Insurers, the insurance industry pays out almost £13 million every day to homes and businesses that have suffered a loss. So, give it a try – one day you could be glad you did.