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Who Needs Commercial Property Insurance?

Commercial property insurance isn't just for large corporations.

Coverage may be appropriate for many types of commercial property owners and businesses, including:

Commercial Property Owners

Protect the building and eligible property associated with your commercial real estate investment.

Business Owners

If you own the building where your business operates, commercial property insurance may help protect the building and the property used in your operations.

Business Tenants

You don't necessarily have to own the building to need commercial property coverage. If you lease your business location, you may still need coverage for equipment, inventory, furniture, fixtures and other business property.

Real Estate Investors

Commercial property insurance can be an important part of protecting income-producing real estate and the assets associated with your investment.

Retail Businesses

Protect eligible business property, inventory, equipment and other assets associated with your retail operation.

Contractors

Depending on the operation, contractors may need coverage for business property, equipment, tools and other assets.

Professional Offices

Medical, accounting, consulting, real estate and other professional offices may have significant investments in furniture, equipment, technology and improvements.

Property Managers & Investment Companies

Commercial property insurance can help address property-related risks associated with qualifying commercial real estate.

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What Does Commercial Property Insurance Cover?

Coverage varies by policy, insurance company, property type and business operation. Your policy documents determine what is covered, the applicable limits and deductibles, and what exclusions apply.

Depending on the policy, commercial property coverage may include protection for:

• Commercial buildings
• Business personal property
• Furniture and fixtures
• Equipment
• Inventory and merchandise
• Certain improvements and betterments
• Eligible exterior property
• Business records and valuable papers
• Business income
• Extra expenses following a covered loss
• Certain equipment or machinery
• Other eligible property specified by the policy

Texas Department of Insurance notes that commercial property policies can cover buildings and business property and may provide business-income protection when a covered loss prevents normal operations.

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What Can Commercial Property Insurance Protect Against?

Commercial property policies can provide protection against covered causes of loss, sometimes called perils.  Depending on the policy, covered causes of loss may include events such as:

Fire

Fire can cause extensive structural and business-property damage. Commercial property insurance may provide coverage for eligible property damaged by a covered fire.

Wind & Hail

Texas businesses can face significant weather-related property risks. Coverage for wind and hail depends on the policy and applicable exclusions, deductibles and endorsements.

Water Damage

Certain types of water-related damage may be covered, while other causes of water damage may be excluded or require separate coverage.

Vandalism

A commercial property policy may provide coverage for eligible property damaged by vandalism when the loss is covered under the policy.

Theft

Coverage for theft depends on the policy, the type of property involved and applicable conditions and exclusions.

Other Covered Causes of Loss

Commercial property policies may be written with different levels of protection. Texas Department of Insurance describes basic, broad and special forms, with special-form coverage generally providing broader protection subject to the policy's exclusions.

Important: No commercial property policy covers everything. Flood, earth movement, wear and tear and other causes of loss may be excluded or require separate coverage depending on the policy.

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Commercial Building Insurance

If you own a commercial building, the building itself may be one of your company's largest assets.

Commercial property insurance may be structured to protect eligible portions of the building and associated property against covered losses.

This may be especially important for:

• Office buildings
• Retail properties
• Warehouses
• Small commercial buildings
• Mixed-use properties
• Investment properties
• Restaurants
• Professional offices
• Contractor facilities
• Other qualifying commercial properties

 

The appropriate amount and type of coverage depends on the property, occupancy, construction, location, replacement costs and other underwriting factors.

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Business Personal Property Coverage

Your business isn't just the building.  Consider everything inside it:

Computers. Furniture. Equipment. Inventory. Tools. Fixtures. Merchandise. Supplies. Machinery.

A commercial property policy may provide coverage for eligible business personal property damaged by a covered event.

This can be particularly important for businesses that have significant inventory, specialized equipment or expensive technology.

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Business Income & Interruption Coverage

What happens if a covered property loss prevents your business from operating normally?  The physical damage may be only part of the problem.  Your business could also experience:

• Lost revenue
• Continuing expenses
• Temporary relocation costs
• Additional operating expenses
• Delayed reopening
• Lost customer activity

Depending on the policy, business income coverage may help address certain income losses resulting from a covered property loss. Extra expense coverage may help with certain additional costs incurred to continue or resume operations.  This is one reason commercial property insurance should be evaluated based on your actual business operations, not simply the value of the building.

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Replacement Cost vs. Actual Cash Value

One of the most important questions when evaluating commercial property insurance is:

How will your property be valued after a covered loss?

Commercial property policies may use replacement cost, actual cash value, or a combination of valuation methods.

Replacement Cost

Generally, replacement cost coverage is designed to pay the cost to repair or replace covered property without subtracting depreciation, subject to the policy's terms, conditions, limits and deductibles.

Actual Cash Value

Actual cash value generally takes depreciation into account when determining the value of covered property.  The difference can be significant following a major loss.

We'll help you understand the valuation approach available for your policy so you can make a more informed insurance decision.

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Additional Commercial Property Coverage to Consider

Depending on your property and business, you may want to discuss additional coverage options with your insurance professional.  These can include:

Business Income

Protection for certain income losses following a covered property loss.

Extra Expense

Potential coverage for certain additional expenses needed to continue or resume operations after a covered loss.

Ordinance or Law

May help address certain additional costs associated with repairing or rebuilding property to comply with applicable building codes after a covered loss.

Equipment Breakdown

May be appropriate for businesses that depend heavily on machinery, HVAC systems, electrical equipment or other covered equipment.

Inland Marine

May be relevant when your business owns or uses certain property that isn't adequately addressed by a standard commercial property policy, particularly property that moves from one location to another or property held for others.

Flood

Flood is generally not automatically covered by a standard commercial property policy. Depending on the property and location, separate flood coverage may need to be considered.

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Commercial Property Insurance for Landlords & Investors

If you own commercial real estate primarily as an investment, your insurance needs may be different from those of a business occupying its own building.  For example, you may need to consider:

• Building coverage
• Liability coverage
• Loss of rental income
• Tenant improvements
• Property management responsibilities
• Vacancy
• Construction or renovation
• Wind and hail exposure
• Flood exposure
• Other property-specific risks

The right policy depends on the property's use, ownership structure, occupancy and other underwriting considerations.

If you're a commercial real estate investor, tell us about the property before purchasing coverage so we can help you identify the appropriate questions to ask about your insurance options.

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Why Choose Us?

Insurance + Real Estate + Business Experience

Insurance doesn't exist in a vacuum.  A commercial property owner may also need to think about:

Real estate → financing → insurance → property management → tenants → business operations

That's where Sams One Stop's broader experience can be useful.

Our services include:

• Real estate support
• Insurance and bonds
• Property management support
• Loan servicing
• Business consulting
• Government contracting consulting

Our goal is to understand what you're actually doing with the property, rather than simply asking you for the address and sending you a generic quote.

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Our Commercial Property Insurance Process

1. Tell Us About Your Property

We'll need information about the property, location, occupancy, construction and how the property is being used.

2. Tell Us About Your Business

We'll want to understand your operations, equipment, inventory and other relevant exposures.

3. Review Available Options

We'll help you evaluate available commercial property insurance options, including limits, deductibles, valuation and other important policy considerations.

4. Choose Your Coverage

Once you've reviewed the available options, you can make an informed decision about the coverage that best fits your needs.

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Get a Commercial Property Insurance Quote

Protect What You've Worked to Build

Whether you're a commercial property owner, real estate investor, landlord, contractor, retailer, professional, or small-business owner, the right commercial property insurance can be an important part of your risk-management strategy.  Don't wait until after a loss to discover a coverage gap.

Request Your Commercial Property Insurance Quote Today