Commercial Property Insurance – What cover do I need?

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Are you a Landlord of a Commercially Let property?

Commercial property insurance helps businesses pay for repair or replace property that was damaged by a fire, storm, or other event covered by the policy. It also pays to replace stolen or lost property.

 

You can buy a single policy to cover a business with more than one location, unless the locations have different functions and risk profiles. For instance, you might have an administrative office at one location and a factory at another. If your business has operations at multiple locations, you may need separate policies.

 

If you rent or lease a building to a tenant the property they own inside the building usually won’t be covered by the property owner’s policy. Your tenant needs to insure their machinery, furniture, stock and contents.

 

Cover Required

• Material Damage this cover can be “All Risks” cover
• Public/Property Owners’ Liability- You can obtain cover for €2.6m or €6.5m
• Business Interruption / Loss of Rent
• Legal protection

 

Understanding Commercial Property Premiums

Insurance companies use a process called underwriting to determine the frequency and the likelihood of a possible property claim. The greater the likelihood of a claim, the higher the premium will be.

Fire Risk is usually the primary factor that determines a business’s commercial property rates. Insurance companies sometimes carry out inspections or surveys as part of the underwriting process. Fire inspectors use a standard rating system and weigh five factors to determine a structure’s fire rating.

 

• Construction materials:Buildings made of potentially combustible materials will have higher premiums, while those made of fire-resistant materials could earn a discount. Additions to an existing structure might affect a fire rating, so it’s a good idea to talk to your broker before remodelling. Internal structural elements can also affect a fire rating. Using wood partitions, floors, and stairways in an otherwise fire-resistant building will likely nullify any rate reduction. Fire-resistant interior walls, floors, and doors can help maintain a good fire rating. Composite panelling can be a considerable fire risk.

 

• Location: Buildings in cities or towns with good fire protection typically cost less to insure than buildings outside a city or in areas with limited fire protection.

 

• Occupancy: A building’s use also affects its fire rating. An office building will likely rate better than a restaurant or motor repair shop. In a building with multiple tenants, one hazardous occupant will negatively affect the fire rating of the entire building. If your business is in a building with a more hazardous tenant, your premiums will be higher.

 

• Fire protection measures: Integrated Fire Alarm system can reduce a building’s fire rating.

 

• Exposure: Nearby hazards increase a building’s fire risk. Proximity to external fire hazards, such as a lumberyard, a tyre storage facility or an oil storage tank, will affect a fire rating even more. Other things that could affect your fire risk include cluttered buildings and grounds, heavy mechanical or electrical equipment, or volatile materials stored on site.

 

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