Building & Commercial Property Explained

Understanding Your Building And Personal Property Insurance Policy

In general, building and personal property insurance policies offer coverage that fits into one of three categories, building, business personal property, and personal property of others. The property insurance needs from one business to the next may vary greatly. Therefore, coverages and coverage limits may be tailored to accommodate the needs of many different commercial property owners. Some companies use standard policy forms, such as ISO forms, to offer a building and personal property insurance policy. Other companies may use there own forms to create policies allowing them to offer and exclude coverages based on the risk itself. When choosing a building and personal property insurance policy it is important to review the coverages, provision, conditions, and exclusions of the policy to make sure the coverages accurately reflect the needs of your business.
Building Coverage When insuring a building, a description of the building, including its location, construction, and occupancy, is normally listed on the declarations page of the policy. Coverage for a building is commonly provided by the building’s owner. Building coverage normally includes coverage for permanently installed fixtures, machinery, and equipment. In certain situations building coverage includes personal property used by a landlord to service or maintain a building, such as refrigerating, ventilating, and laundering equipment. Personal property provided by a landlord not used for a buildings maintenance or service is generally not included in building coverage. Owner-occupied buildings may have personal property listed in the building coverages that is also covered through the business personal property coverage. In the event of a loss, an insured would want to file a claim under the section of the policy which offers them the broadest coverage.
Your Business Personal Property Your business personal property coverage normally includes the personal property owned by an insured, labor, materials, or services furnished on property of others, leased personal property, and a tennants use interest in improvements and betterment to the property. Again, policies may very and it is important to review your policy to verify coverage. Property owned by the insured, refers, as the name implies, to personal property owned by the insured and used in his or her business. For example, removable fixtures, stock, machinery, and equipment would generally be considered an insureds personal property. Labor, materials, or services furnished on the property of others covers the insureds cost of labor and materials used on a customers property while at the insureds place of business. The use interest of improvements and betterment, refers to non-removable items added at the tenant’s expense, which he or she has an interest in while renting or leasing the building. Leased personal property refers to leased property which must, by contract, be covered by the insured. If the insured is not contractually obligated to cover the leased property, coverage does not apply.
Personal Property Of Others Personal property of others coverage applies when an insured holds someones property in their care, custody, or control, for reasons that is benefit both parties. This type of coverage is commonly referred to as bailees coverage. Again, building and business personal property policies come in many forms. It is very important to review a policies coverages, provisions, conditions, and exclusions prior to purchasing the policy. You should talk to us about specific policy questions. Request a free quote