SMART Client Testimonial – Brenda Freeman
Client Testimonial – Brenda Freeman Meet Brenda Freeman from Global Options Brenda Freeman is co-founder of telecommunication specialists Global Options. Brenda’s Toowoomba based business, are
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Commercial property insurance can help your business recover after a destructive event. Disasters can strike with little or no warning, leaving commercial buildings devastated. Within a matter of minutes, the business property you lease, or have worked so hard to call your own, could be severely damaged from heavy winds, electrical damage, storms, or fire.
Construction costs are escalating due to the global demands of materials and workforce. The cost to rebuild may be significantly higher today than just a year ago. Additionally, many commercial property owners have cutting-edge and expensive equipment and supplies at risk.
After a serious event, you may face a substantial loss of income as you rebuild. While commercial property insurance can help you repair your building, other types of business insurance can protect your income. We discuss these below.
Commercial property insurance is called business property or commercial building insurance. A sufficient policy offers coverage that protects business owners from damage or loss of essential business equipment, as well as damage to the commercial building. This coverage helps protect the business from significant loss due to a weather disaster, fire, or theft.
The purpose of commercial property insurance is to cover the loss or damage to buildings, property, and contents. A commercial property insurance policy can help keep your business afloat when an unexpected loss occurs. Dollar-for-dollar, a commercial property policy is one of the best investments you can make in your business.
Here are a few of the most important reasons why business owners buy a commercial property insurance policy.
If a covered event damages your business property or the contents, this insurance coverage can help pay for the repair or replacement of these assets. Additionally, if you are a tradie, material theft is a significant risk as timber and other costs increase.
You have peace of mind when you know you have protected your commercial building and equipment from sudden damage, accidents, or theft. When disaster strikes, you are well prepared to withstand even a significant loss.
For sole traders who run their enterprises from home, a commercial property insurance policy offers coverage that you will not find in your traditional home insurance policy.
While all insurance companies provide somewhat different coverage options, many providers can include the following.
While standard commercial property insurance covers damage caused by fire and accidental damage to buildings, contents, and when included, stock, it does not include loss of income from business interruption.
Many business owners also purchase business interruption insurance to protect against lost income after a covered loss. They may buy protection via a tailored business insurance pack, or a “biz pack.” This comprehensive policy can bundle the following.
It is important to understand that flood damage may or may not be covered. Please check your policy carefully. A SMART Business Insurance broker can help you obtain the specific coverage you seek.
You typically can select coverage for theft under a commercial property insurance “biz pack.” Generally, insurance companies will pay for loss or damage to the contents of the building and company inventory due to theft, attempted theft, armed hold-up, or vandalism. Many commercial property insurance policies will also allow you to cover damage to glass or signs, which often occurs during vandalism or a break-in.
Events that a commercial property policy may cover include the following*
The Situation Address must be the address of either the physical risk being covered (like a property) or, in the case of Liability policies, the physical address for the normal place (or places) of business.
If you have multiple business locations, e.g., a number of branches, shops, factories or depots, then ALL location addresses must be shown on the schedule and advised to the insurers. And the multiple location addresses then needs to be kept up to date with the insurers at all times, in the event of any changes.
Insurers will not accept a Post Office box as a “normal place of business”, because you cannot do business from a PO Box.
A PO Box is fine for a mailing address, but cannot be used as the address of the “Situation” on any policy.
For example, Public Liability policies usually operate “at and from” an address, which should be the normal place of business for a business policy.
If the business was run from home, for example, then the home address would be shown as the normal place of business. The “at and from” nature of the cover would then cover any transitory business conducted away from the home address (or away from a real business address, as the case may be).
If the business was run from home but was selling through stands or kiosks at markets or shopping centres then that would have to be disclosed to the insurer, as it affects the risk.
When trying to determine how much coverage you need for your business location, keep in mind that insurers design this type of policy to restore your company to the same financial state as before the damage occurred. That means being able to rebuild and replace the buildings and contents at today’s prices without depreciation for wear and tear. This is known as replacement cost coverage. Businesses with highly customised or specialised property will typically mean greater replacement costs.
Insurance coverage can vary significantly from one company to the next. When purchasing a business policy for the first time, know that exclusions exist in all property policies. Exclusions carve out coverage and can create unexpected out-of-pocket expenses if not fully understood. Therefore, it is important to consult with an insurance broker before you make a final decision on your company’s new or renewal insurance policy.
To learn more about commercial property insurance, contact our insurance brokers today. Our licensed professionals will be happy to answer your questions.
Several key factors influence commercial property insurance rates, including the following.
Many factors influence the cost of commercial property insurance. Not sure how much coverage you need? Call 1300 542 573 and talk to a SMART Business Insurance broker who may be able to assist you in finding suitable cover at an affordable cost.
Whether your business property is a factory, warehouse, or office building, our team of Smart Business Insurance brokers can provide you with multiple quotes for suitable policies from leading insurance companies.
For a property insurance quote for your commercial business property needs, talk to a Smart Business Insurance broker on 1300 542 573 or enquire online.
As a commercial property owner you are aware that when your commercial property becomes vacant for an extended period your insurance could be voided? Or that a change in your tenant’s occupation can impact your premiums and in some cases even affect your insurer’s willingness to cover your property?
As all commercial property owners know, re-tenanting a commercial property that becomes vacant can take some time. Take a walk down Brunswick Street Fitzroy or Chapel Street South Yarra and even the casual observer will see the number of “for Lease” signs that signal the change in commercial fortunes.
While the financial loss of rent can be significant, property owners need to protect themselves against other unforseen risks once a property becomes vacant to avoid more potential losses.
Vandals and squatters often target empty shops, warehouses and factories because they see them as easy targets. Insurers are all too aware of this and rate unoccupied premises accordingly.
The increased risks associated with vacant property generally means an increase in premium and / or an increase in excess in the event of claim. This is a small price to pay relative to a claim being denied or your cover being significantly reduced because you did not inform your insurer if your property was untenanted for more than 90 days. If your property is untenanted for more than 90 days some insurers will not want to provide cover so it is critical you contact your broker in this event.
Property owners also need to inform their broker/ insurer if there is a change in tenant. When a property is rated for risk it is done so based on your declared tenant. From example if your tenant changes from a tile warehouse to a wood working business the risk of fire is greatly increased and hence your insurer will rerate your property with a likely increase in premium and/or changes to the insurance terms and conditions. Failure to notify your insurer of a change in tenant may void or significantly reduce your cover in the case of a claim.
In some extreme cases you may not even find an insurer who is willing to insure your property. For example Tattoo Parlours are notoriously difficult to insure due to the moral risk / associations with bikie gangs, even if your tenant has no association with any bikie gang.
Unfortunately these considerations are often overlooked leading to significant financial loss in the event of a claim for property owners who are not well advised.
If you would like to review your current commercial property insurance arrangements please call 1300 542 573 and speak to one of the SMART Business Insurance Commercial Property Specialists.
Although specific information has been prepared from sources believed to be reliable, we offer no guarantee as to its accuracy or completeness. The information stated, opinions expressed and estimates given constitute best judgement at the time of publication and are subject to change without notice to you. Consequently, although this document is provided in good faith, it is not intended to create any legal liability or advice on the part of SMART Business Insurance Pty Ltd.
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Client Testimonial – Brenda Freeman Meet Brenda Freeman from Global Options Brenda Freeman is co-founder of telecommunication specialists Global Options. Brenda’s Toowoomba based business, are
Are You Gambling With Your Commercial Property Insurance? Commercial investments can be a risky business at the best of times, especially in a perpetually changing
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