A lot of planning usually goes into buying your first commercial property. Potential location, types of businesses to run out of it, and typical maintenance plans are among the more common decisions that need to be made.
Another common decision associated with buying your first property is finding the best commercial property insurance coverage. With the multitude of eventualities that can go wrong, getting the right type of insurance from the beginning is crucial.
More Reasons to Invest in Insurance than Not to
At its core, commercial property insurance has been designed to protect your commercial property and buildings from a wide range of damage and loss. With this insurance, you can look forward to coverage that includes the following:
- Buildings on the property
- Business interruption
- Equipment and inventory
- Injuries to employees
Whether you’re planning to lease out the property or run your own business on the property, there are many risks to be aware of. Instead of stressing over what could go wrong, it’s a good idea to be proactive and plan for any eventuality. We’ve compiled the most significant ways that your property and your peace of mind will benefit from this type of insurance.
1. Extensive Coverage Options on Offer
The most significant benefit of investing in commercial business insurance is that coverage can easily be tailored to suit your specific insurance needs. The type of coverage you will qualify for, and the subsequent premium cost depends on two common factors as listed below:
- Industry type: The type of business you have on the property is a huge deciding factor in the type of insurance you need. This is because some industries and sectors may be at higher risk because of specific eventualities. A good example of this is an industrial factory versus a clothing store. Since the risks of a factory eventuality are significantly greater, the premium may be higher.
- Location: Where your property is located can also be a big determining factor when calculating the potential premium. For instance, properties in areas prone to bushfires and natural disasters will have higher premiums. Low-risk businesses in safer areas can look forward to reduced premiums.
2. Provides Coverage for Loss of Rental Income
Many first-time commercial property owners invest in land with the sole purpose of leasing it out. This is not only an effective way to supplement income but also serves as a long-term investment.
Unfortunately, a natural disaster or business interruption can make it impossible for your tenant to pay rent. With the right commercial property insurance, your premium will cover lost rental or mortgage costs for a predetermined time.
3. Covers the Risk of Natural Disasters
Natural disasters are on the increase around the globe and Australia is no exception. High-risk areas often fall victim to flooding and bushfires, making it essential to have insurance that covers both the roof and the building.
This feature is significantly beneficial since roof repairs and replacements for such large roofs can be quite costly and can take months to finalise, especially if an extensive area has been affected.
4. Can Protect Your Property or Business from Vandalism
Vandalism refers to damage done to your property or buildings by a third party for spite. If this type of malicious damage is prevalent in your area, it may increase your monthly premium.
Typical examples of this can include the following:
- Graffiti and spray painting on buildings, equipment, and other assets
- Arson and other deliberate fire-setting instances
- Physical damage such as damaging property, buildings or equipment
5. Protects Against Water Damage
Water damage can cause extensive damage to your property, buildings, furnishings, flooring and any equipment or machinery you may have on the premises. In most cases, water damage may be caused by flooding from excessive rainfall, which is currently on the rise in some areas.
Faulty plumbing can also extensively damage building interiors, industrial machinery, and IT equipment. This not only causes downtime in your business but can result in high repair costs. Avoid bearing the full brunt of this by investing in the best commercial property insurance.
6. Safeguards You Against Potential Public Liability
Many commercial businesses, such as stores, food places, and office parks deal directly with the public, which means there’s always the risk of someone getting hurt. Personal injury claims, such as those lodged after slip and fall accidents, can lead to you being liable and responsible for medical bills and legal fees. The right insurance cover will keep you protected against a drawn-out legal issue that affects your profits and business reputation.
Final Thoughts
Commercial property insurance is a necessity for anyone who owns a commercial property and provides coverage against instances of loss of rental income, vandalism, natural disasters, and water damage.
The type of insurance cover you opt for can easily be customised to suit your business and property requirements. Add this coverage to your portfolio today and give yourself the peace of mind that you’re covered against any potential eventuality.
