Property Insurance is an essential tool that helps in the smooth functioning of business even after a mishap. Every SME owner remains skeptical to buy a property insurance policy but it should be the first priority for small businesses.
There are some unfortunate events such as fire, theft, earthquake, etc which could hamper the working of a business, and sometimes business is not in a position to recover from such losses. Your business property brings its own share of risks. Commercial property insurance manages that risk, making the loss as less as possible.
There are a series of property insurance every small business should opt for in order to safeguard the company’s property and assets:
1. Standard Fire Insurance:
Standard fire insurance protects your property and its content from fire and special perils such as lightning or any other natural catastrophe. If you have an insurable interest in the property and its content, buying fire insurance is worth giving a thought.
Every small business, shop, office, educational institution, hotel, industrial and manufacturing unit, hospital, bank, etc should buy standard fire insurance. It is an essential protection plan for commercial assets and buildings which otherwise if faced with a mishap, would not be able to recover.
You can raise a special request to the insurer in order to cover the valuable articles in a standard fire insurance policy. Various add-on covers can also be included in the policy by paying an additional amount.
Also Read: What will be the cost of a fire insurance policy?
2. Burglary Insurance:
If your building is in a crime-prone location, there are high chances of shoplifting and burglary. One should buy burglary insurance to protect the valuable articles, furniture, fixtures, cash, and securities kept in a locked safe, etc. Burglary insurance provides financial compensation against damages and losses faced by the insured in case of burglary.
3. Portable All-Risk Insurance:
Portable all-risk is comprehensive property insurance that provides total cover for portable equipment like laptops and mobiles. It is also known as an open-perils policy. This policy provides coverage against every potential risk exposure except a few specifically mentioned exclusions under the terms of the policy. It also covers accidental damages to portable equipment which are not covered under general fire insurance.
4. Construction All Risk Insurance:
When the building is under construction, contractors also face the risk of losses due to fire, storm, lightning, theft or burglary, etc. In order to protect the insurance interest of contractors, contractors’ all-risk insurance is the ultimate solution.
In order to mitigate the risk of loss or damages to raw materials, buying construction all risk insurance is necessary. For civil engineering project contractors, construction all-risk insurance is unavoidable since projects like building flyovers, dams, or buildings possess very high risk.
5. Factory and Warehouse Insurance:
Manufacturing units and storage of goods inhabit a series of risk exposures. Plant and machinery, raw materials, inventory, stock, and tools can damage due to any unforeseen event. Factory and warehouse insurance is a type of property insurance that provides coverage against any loss or damage to the machinery, stock, and other contents present within the factory or warehouse. Insured will get the cost of replacement and reinstatement of the assets covered under the policy.
6. Add-on Covers:
Extensions such as machinery breakdown and electrical equipment insurance cover can be included in factory and warehouse insurance or in standard fire insurance in order to gain additional insurance protection. By paying an additional premium amount, one can easily protect their commercial assets from every potential risk exposure.
Case Study: Property Insurance
L.T. Private Limited has bought standard fire insurance coverage. They have also included various add-on covers such as burglary, and machinery breakdown under the terms of the policy. The policy was having plate glass under the exclusion. Later, in the year, a plate glass worth Rs. 40,000 got damaged due to an accident. The organization was of the mindset that property insurance would cover plate glass damage. But the insurer rejected the claim. Therefore, before buying an insurance policy, it is important to read the terms of the policy carefully.
One can also opt for an office insurance package policy. It provides wider coverage and ensures your building and assets are from every possible threat. It is a single policy that covers all your commercial assets. You can also cover third-party liability cover in your office package policy as well along with covering other assets and risks for your office. You have the flexibility to customize your office insurance package policy as per your business requirement.
About The Author
Shivani
MBA Insurance and Risk
She has a passion for property insurance and a wealth of experience in the field, Shivani has been a valuable contributor to SecureNow for the past six years. As a seasoned writer, they specialize in crafting insightful articles and engaging blogs that educate and inform readers about the intricacies of property insurance. She brings a unique blend of expertise and practical knowledge to their writing, drawing from her extensive background in the insurance industry. Having worked in various capacities within the sector, she deeply understands the challenges and opportunities facing property owners and insurers alike.
