When owning and operating any business, one of the most important things to consider is insurance coverage. Having sufficient commercial property coverage is essential to ensure your company and its property are covered when the unexpected happens. There are important factors to consider when purchasing commercial property coverage and your options should a commercial claim be denied.
What to Consider When Purchasing Commercial Coverage
Commercial insurance policies include a variety of options and coverage can range from the basics – such as fire and vandalism – to a broader scope of coverage. The specific amount of coverage needed for a business property may vary based on the company and its specific needs.
When purchasing commercial property insurance, you will need to accurately determine the amount of coverage needed. The amount a business should pay for insurance takes into account the overall value of a company’s assets as well as the building(s). For example, businesses that utilize equipment worth millions of dollars, such as railroads, manufacturers, and oil and gas companies are going to require a much higher amount of coverage. Before discussing coverage options with a salesperson or broker, take a total inventory of all physical assets that are or will be located on the property to better ensure the appropriate level of coverage.
Another factor to consider when determining the amount of coverage necessary is the weather conditions around the property. For instance, when purchasing commercial property insurance in the Houston, Texas area, business owners should account for potential flood and wind damage due to the prevalence of hurricanes. Similarly, if a business owner is considering setting up shop in California, they should be cognizant of the potential for wildfires or earthquakes. Commercial insurance rates can increase for properties located in areas with a higher risk of natural disasters.
Some other factors business owners should consider when purchasing commercial property coverage include:
Legal Obligations
Depending on the industry, state laws, and other requirements, some businesses will have differing legal obligations they must abide by when purchasing insurance. For instance, if a business owner is renting a commercial space, the landlord may require the purchase of general liability insurance, which can protect against costs associated with third-party damages or injuries. Additionally, depending on the state in which the property is located, business owners may be required to purchase workers’ compensation insurance. In Texas, however, this is not required.
Prioritizing Coverage Over Cost
While it can be tempting for smaller, more budget-conscious business owners to pick the cheapest policy available, this choice can leave them exposed to significant financial risk because less expensive policies often offer more limited coverage.
Evaluating the Policy Thoroughly
Insurance policies can vary widely among different carriers. Each will have its own limits, premiums, deductibles, and exclusions. When purchasing a commercial policy, business owners should ensure they understand what will be included and excluded to ensure there are no gaps in coverage.
When Commercial Claims Are Wrongfully Denied
Insurers make more money when claims are underpaid, delayed, or denied, so even when business owners go above and beyond to ensure their operations are fully covered, an insurer may still wrongfully deny a valid claim for damages. While claims can be appealed through traditional methods or by invoking an appraisal clause, this often only leads to lengthy periods without financial relief, leaving damaged businesses inoperable until a decision is reached. When this happens, it’s best to consult with a commercial property damage attorney.
Commercial Property Damage Attorneys
Property damage to a business caused by storms, flooding, fires, other natural disasters, or vandalism can be utterly devastating. At Raizner Law, we understand your business is an investment and that dealing with a commercial property damage claim can hurt your livelihood. If your insurance carrier wrongfully denies coverage for your loss or delays your claim, they should be held accountable. Contact us today to discuss your situation with our team of experienced insurance coverage attorneys.
