Businesses that own properties have a lot invested in their buildings and land. If anything were to happen to a property, the financial consequences could be devastating for the owning business. Commercial property insurance policies help Massachusetts businesses protect their properties from a variety of covered risks.
In protecting properties, commercial property insurance policies are somewhat similar to homeowners policies that safeguard personal residences. The coverages found in commercial property policies differ from those provided by most homeowners policies, though.
Most business property insurance policies offer two main coverages:
Some policies offer additional property coverages, such as earthquake or flood coverage. These are often optional protections when they’re made available, and not all business property policies make them available.
Most business property insurance policies don’t include any form of liability coverage. In this way, these policies differ from the majority of homeowners policies.
It’s not because businesses are free from liability risks that business property policies don’t offer this form of coverage. It’s because businesses face varied liability risks that this coverage isn’t included in property policies.
Separating liability coverage form property coverage lets businesses purchase a property policy that suits their needs and then get liability coverages that are tailored to their risk exposure.
Businesses that own buildings or land in Massachusetts generally should have coverage for their property. In some cases, businesses that don’t own buildings or land may still want coverage for their equipment, inventory and supplies. Without coverage, businesses can face substantial financial costs if something happens to their property.
Commercial property policies are written as either open- or closed-perils policies. Open-perils policies normally cover any risks that aren’t excluded within their paperwork. Closed-perils policies usually only cover the perils that are mentioned within their documentation. In most cases, open-perils policies offer broader protections than close-perils policies.
Insurers consider many different factors when setting a commercial property policy’s premiums. Some of the items that insurance companies frequently take into account include:
The coverages and limits that a business chooses also, of course, play a large role in how much a policy costs.
Commercial property policy premiums can typically be written off as a business expense so long as the policy is only used to insure a commercial building. A policy that insures a commercial and a personal space might not be tax-deductible or may only be partially tax-deductible.
Because tax laws change and are complicated, businesses should confirm with a tax professional that their particular commercial property policy’s premiums are deductible before writing the premiums off.
Choosing commercial property coverage is an important decision and complicated decision. Businesses need to find a solution that offers robust coverage for their particular policy yet manages to be budget-friendly.
For help finding an affordable commercial property insurance policy, Massachusetts businesses should talk with an independent insurance agent from Dempsey Insurance Agency. Our knowledgeable, independent agents can compare policies from different insurers and has the knowledge necessary to accurately contrast each policy’s protections.
This material is for informational purposes only. All statements herein are subject to the provisions, exclusions and conditions of the applicable policy, state and federal laws. For an actual description of coverage, terms and conditions, please refer to the applicable insurance policy or check with your insurance professional. The illustrations, instructions and principles contained in the material are general in scope and, to the best of our knowledge, current at the time of publication.
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Our insurance agency is committed to dealing fairly with complete integrity and transparency with consumers, other insurance producers and others with whom we work in providing insurance products and services. To that end, we provide this disclosure regarding our sources of compensation from insurance companies or other parties.
Our agency may receive compensation in the form of commissions paid by an insurance company, calculated as a percentage of premiums, pursuant to an arrangement with the insurance company. These commissions are for the service we perform in placing and servicing insurance policies on the insurance company’s behalf.
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Other insurance producers who perform service in placing and servicing insurance through our agency may receive compensation from our agency in the form of service fees as determined by our agency’s arrangement with such producer.
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