How Business Insurance Coverage Works

1/14/2022 (Permalink)

Water damage in a commercial building in Colorado Springs, CO.

Your business in Colorado Springs, CO, needs protection from a variety of potential problems. Basic property insurance is a must, but you also may benefit from flood or storm insurance. While your insurance agent is able to advise you on the policies that you should include in your commercial package, it doesn't hurt to have an overview of the information before you meet with him or her.

Types of Coverage

It takes a village of policies to cover a commercial property adequately. There are several types of insurance coverage to think about:

• Property insurance – covers general repairs, such as water damage from leaks, caused by accidents or external factors
• Flood insurance – covers more extensive damage caused by prolonged rainfall, overflowing rivers and streams, and breaking dams or levees.
• Storm insurance – covers damage from wind, hail, or other elements of the specific storms listed in the policy

You may also consider a business continuity policy so that you have the working capital to stay afloat while storm remediation experts are working to return your building to an inhabitable space.

Dollar vs. Percentage

Insurance policies can have different types of deductibles. Many plans have dollar deductibles. A specific amount stated in the policy must be paid before insurance kicks in. These deductibles are often determined by the standard rate for the area, and raising the amount may result in lower premiums for the policy. A percentage deductible is sometimes used in storm and flood policies to lower the risk for the insurance company. Because the damage covered by these policies tends to be large, so do the payouts. This deductible depends on a percentage of the property's overall value.

When shopping for commercial insurance coverage, a basic property policy isn't enough to cover everything that might come your way. It's a good idea to add additional policies, such as flood and storm insurance, so that you can be confident that you will be able to overcome any damage that happens to your property.