Commercial Property Coverages

Commercial property policies are regulated differently than Texas personal insurance policies.  Commercial policies are extremely flexible.  Therefore, it is important for business owners to review policies with a business insurance specialist.  Aside from price, business insurance policies can vary greatly from carrier to carrier.

Business owner program (BOP) policies are considered multi-peril policy that combines coverage for business property and liability into one policy

Commercial multi-peril (CMP) policies or Commercial package (CPP) policies generally combine multiple policy coverages and policy types into one policy.  A Commercial multi-peril policy can include commercial proprety, general liability, inland marine, commercial auto, and business umbrella policies in one policy.

Generally, commercial property policies many of the following coverages on a base policy o or through policy endorsements. Endorsements expand or amend a policy’s coverages and usually increase the policy’s insurance premium.

According to the Texas Department of Insurance, the following are some typical commercial property coverages:

• Building occupied by the insured coverage insures a building that you regularly use but do not own. This coverage can be important if you lease or borrow a building that is critical for your operations.
• Newly acquired or constructed buildings coverage insures a new building if you add it to your policy within a specified amount of time. If you don’t notify your insurer within the time period – usually 30 days – your policy won’t cover the new building. Commercial property policies generally only cover buildings named in the policy.
• Employees’ personal property coverage insures your employee’s personal property against covered losses if the property is on your premises. Generally, you must buy this coverage as an endorsement if you need more than a limited amount.
• Off-premises property coverage covers your property located off site. Some policies might not cover off-premises property or may provide only limited coverage. You can usually buy an endorsement to cover off-premises property. If you can’t buy an endorsement, you may have to buy a separate policy.
• Business interruption coverage pays for actual or projected lost income if loss from a covered peril prevents normal business operations.
• Extra expense coverage pays any additional costs to expedite your business’s return to normal operations after a covered loss.
• Valuable papers coverage provides limited coverage of your business records and other essential information. You may be able to buy an endorsement to increase this coverage.
• Ordinance or law coverage pays any additional costs required to repair or rebuild a facility damaged by a covered peril to ensure it complies with current building codes. Many policies provide limited ordinance coverage, but you can increase it with an endorsement.
• Boiler and machinery coverage covers boilers, air conditioning units, compressors, steam cookers, electric water heaters, and similar machinery. Coverage generally extends to machinery specifically listed in the policy and to any subsequent losses, such as when a boiler explosion or water heater leak causes damage to other property. You can usually purchase this coverage as either an endorsement or a separate policy.
• Inland marine coverage insures goods in transit by land, air, or inland waterways. It also covers projects under construction and transportation and communications structures, such as bridges, tunnels, and communications towers.

Other Coverages to Consider

Depending on the type of business you own and where it’s located, you might want to consider additional coverages to ensure you’re protected from an array of losses.

Crime Coverage You can buy several types of coverage to protect your business from crime.

Flood Insurance. Most flood insurance in the United States is available only through the National Flood Insurance Program (NFIP). Some insurers may provide flood coverage in addition to NFIP coverage.

Windstorm and Hail Insurance along the Texas Coast
Insurers usually exclude windstorm coverage from commercial property policies for businesses in one of Texas’ 14 coastal counties or within certain areas of Harris County. Businesses within these areas must purchase windstorm coverage through (TWIA) Texas Windstorm Insurance Association.