Business Property Insurance
Business property insurance is designed to replace property damage resulting from a “covered peril.” A “peril” refers to what caused the damage to happen in the first place. Some losses are obviously covered, such as fires or vandalism. Other causes may not be. Are you covered if you lose power due to a car accident two blocks down from you? Are you covered if the sprinkler in your office leaks overnight? Some policies cover these types of risks and others do not. Be sure to tell your agent all the possible risks your business may face.
Once you have determined what coverages you may need, valuation and co-insurance can rear their ugly heads to make the claims settling process difficult. What do these terms mean?
Valuation. There are three basic valuation coverages you can accept.
- Replacement Cost, the cost to replace with like kind and quality.
- Actual Cash Value, cost new less depreciation.
- Functional Replacement Cost, cost to rebuild with a functional building.
Co-insurance - A type of insurance in which the insurer and the insured split risks with each other. It often lowers the initial cost of insurance for the insured, but you will be responsible for a portion of the loss.
You need to analyze your business. Determine the coverages that you currently have and consider coverages based on “perils” you may not have considered.
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Peter Green Insurance Agency LLC is a full service agency for your business and individual insurance needs.
