Business Property Coverage

Michigan Business Insurance Basics: Property Coverage

Almost all businesses bear responsibility for the safety of their workers and are accountable for injuries suffered on the job, further highlighting the importance of commercial insurance​.”

In the United States, there are over eight million small businesses, all of which require appropriate insurance coverage to protect themselves from potential disasters or lawsuits.”

Whether you own or rent your business premises in Michigan, commercial property insurance, also known as business property insurance, is a crucial component of your operations. This insurance coverage safeguards the physical assets of your business, including inventory, tools, office equipment, furniture, and the building itself. If your business leases its space, business property insurance can cover the portion you’re responsible for, as specified in your lease.

Your business’s requirements will determine whether you need to purchase a standalone commercial property insurance policy or if it can be part of a Business Owners Policy (BOP), which offers additional coverage beyond the physical assets themselves. In this edition of “The Basics Of Business Insurance,” we will examine how commercial property coverage operates in the state of Michigan. Before diving in check out our first Insurance Basics: Understanding a Business Owner’s Policy with Climax Insurance.

What type of damage is covered?

Damage Covered

A typical business property insurance policy covers damage or destruction due to a variety of perils, from fire to theft and everything in between. While the most common causes for a claim in Michigan are wind and water damage, it’s important to account for many other types of potential claims.

Your business likely owns personal property that is vital for your day-to-day operations, and being able to replace it if it’s damaged or lost due to a storm or theft will allow you to recover from the property loss without suffering a financial loss. Appropriate commercial property coverage can make the difference between long-term success and failure when unexpected events strike your business. Please remember that property coverage does not extend liability coverage unless it’s included in your Business Owners Policy or a separate General Liability Coverage policy.

Types of Property Covered

Commercial property insurance can cover a wide range of property or physical assets, including the building where you run your business, the personal property used for day-to-day operations, and inventory that needs to be stored and accessed later. Even if the property is transported away from your commercial buildings or office space, it can be covered if the policy is carefully constructed to cover gaps in coverage.

Property Types

Businesses that lease commercial spaces can also benefit from Business Property Coverage. Leases often require tenants to provide coverage for the building itself or even the systems that you use, even though you don’t own them. If this applies to you, ensure your insurance limits can cover the items stipulated in your lease agreement.

Customized Solutions

Business property insurance policies offer different levels of coverage, and some might come with limitations. For instance, your business equipment might be covered while onsite at your business location, but there might be no coverage if it is off-premises. This could be a significant coverage gap for service contractors who haul expensive tools, equipment, and materials from one place to another.

This is where the true value of an insurance agent who specializes in business insurance comes into play. Whether you’re setting up a new business insurance policy or have been in business for many years, the independent insurance agents at Climax Insurance can help ensure your business is protected when the unexpected occurs. It’s important for us to assess your level of risk and types of potential property damage so that appropriate levels of coverage and policy limits can be set for your specific business. Working with a multitude of insurance carriers, our interests align with yours, as we can prioritize the right coverage while finding you the best price available, rather than forcing your business to fit into a single carrier’s offerings. Let us help you find the right commercial insurance in Michigan so that you can run your business without worrying about the “what ifs.”