Commercial means that which is related to commerce or business. Hence, commercial property claims are nothing but claims related to the premise or physical structure from where the business is run. Commercial property insurance is typically more complex than a residential one. It is primarily because the premise itself is pretty expensive, add to it the cost of appliances and other devices installed or stored inside the building. Then come the people who work there. All in all, numerous things can go wrong and cause harm or damage to your business property. If statistics are to be believed, then almost all businesses file a claim of some sort or the other within the first ten years of their operation.
Exercise Caution While Purchasing Commercial Property Insurance
No entrepreneur can ever forecast correctly what accident will cause harm to their commercial property. As such, they need to cover all bases, leaving nothing to chance. One needs to be prepared to handle the financial implications of not just the loss of property but also the disruption of work. This is why commercial property insurance claims happen to be high-dollar value claims. Exercise caution while purchasing the policy, as you would not want any unpleasant surprises when a claim arises. If there is one guarantee in any business, it is sometimes somethings are bound to go wrong.
Most Common Commercial Property Insurance Claims
Now that we are onto the subject of claims, let us briefly look at some of the most common ones.
1. Theft And Break-in – There is always a risk of theft and burglary or break-in no matter which business you are involved in. It could be a disgruntled employee, an angry customer, a petty criminal, a random person under the influence of drugs or alcohol, or somebody just trying to have some fun. Although, the chances of such an occurrence in a run-down or out-of-the-way neighborhood are higher than in a place bustling with activity. Nevertheless, no place is ever completely safe. According to a survey, almost 20% of start-ups or small-scale businesses have filed for a claim in the last five years.
If you wish to alleviate the risk of theft in your business premises, it would be wise to invest in a state-of-the-art security system. The good news is that some insurance companies offer a lucrative discount on premium if you are already doing it.
2. Weather Damage – Wind, hail, storms, hurricanes, and tornadoes can all cause severe damage to commercial property. The subsequent water and freezing damage only add to the misery. Did you know that almost 25% of businesses that shut down due to damage caused by inclement weather never open up because either they failed to buy the proper coverage or because their insurance provider could not cover the massive loss?
If you run your business from an area where such occurrences are normal, it would be wise to make sure that your insurance company covers them. Otherwise, you may need to purchase additional coverage.
3. Fire Damage – In any commercial building, one of the biggest threats is that of fire. However, every entrepreneur takes reasonable precautions to prevent any fire breakouts. Additionally, they also take steps to ensure that it can be contained with minimum damage if such a thing still happens. Yet, everybody is not always lucky. It could so happen that when a fire breaks out, nobody is present inside the building to contain it, and it spreads. Even if the building is occupied, the danger posed by the fire is so prominent that it is imperative to vacate the premises immediately. At these times, the fire gets a free reign, and it causes immense damage. Therefore, fire claims are usually big value claims.
There is no particular reason for the fire. It could happen due to negligence, a short circuit, lightning, etc. Always keep in mind that fire has the potential to wreak havoc, and so you need ample insurance coverage to get back on your feet even with the setback. Do ensure that fire safety rules and regulations are being followed diligently, as a miss on your part may cause the insurance company to decline your claim.
4. Liability Claims – Accidents happen despite taking all the necessary precautions and sometimes because they lack them. Though rare, these claims can sometimes run into significantly prominent figures. For example, a client visits your premise where he slips and falls or trips over something. The injury caused as a result may need hospitalization and operation. As you are very well aware, medical expenses are high, and consequently, the dollar value attached to liability claims also runs high.
If you wish to keep these claims to a minimum, ensure that everything is kept in place, the walk area is free of obstructions, and all equipment, appliances, and fixtures are adequately secured.
5. Non-Theft Damage – Lastly are those claims that arise due to no fault of yours. For example, a car comes and crashes into your building, ball sails through the large glass window and smashes it, or a tree falls through the roof, etc. A variety of things could happen, and as a business owner, you need to cater to these losses as well. Thankfully such claims are not frequent and also carry a lower price tag.
At your end, all you can do to contain such damage is place roadblocks around the premises such that it does not interfere with the regular traffic and yet keeps your building separate. Use tough fiberglass for windows and such. Your insurance company can suggest several improvements due to the sheer variety of such claims they handle.
No entrepreneur will ever wish for anything wrong to happen on and to their commercial building. Nevertheless, one cannot control everything. Sometimes an untoward incident will happen, which may raise the need for filing a claim. As a business owner, you need to see that the commercial property insurance coverage you buy is sufficient to bear the burden of these incidents and accidents. Safety upgrades will go a long way in containing the resultant damage, but they may not necessarily give you a discount on premiums. Hence, check with your insurance company before investing heavily into such upgrades.
If you need any help in filing a claim or wish to discuss in detail the commercial property insurance coverage that you have or wish to buy, contact the experts at Continental Public Adjusters. We shall be glad to be of assistance.