Why have Property Insurance?

Property Owners Insurance


Buildings are a property owners’ key business asset. Even a seemingly minor property loss can impact the occupancy of a building, while a major event can have a serious and detrimental effect on the operation and financial condition of the business.


Property insurance provides protection against most risks to property, such as fire, theft and some weather damage. This includes specialised forms of insurance such as fire insurance, flood and home insurance.


The following causes of loss are usually covered under a Property Insurance Policy:

  • Fire, Lightning or Explosion
  • Aircraft
  • Riot, Civil Commotion or malicious damage
  • Earthquake
  • Storm or Flood
  • Escape of Water from tanks, apparatus or pipes
  • Accidental escape of water from any automatic Sprinkler Installation
  • Impact by any road vehicle or animal
  • Theft or attempted theft following forcible or violent entry to or exit from the Premises
  • Accidental Damage
  • Subsidence


The following are usually excluded from insurance coverage:

  • Loss or damage caused by wear and tear natural depreciation
  • Loss or damage caused by war, civil war, and kindred perils
  • Loss or damage caused by nuclear activity
  • Loss or damage to the stocks in cold storage caused by change in temperature
  • Loss or damage due to over-running of electric and/or electronic machines

For instance, a landlord has different property insurance needs to a homeowner. What the landlord owns is rental or investment property and the specifics involved in that property type are different from a private home. Rental property insurance also covers the damages or losses arising from negligence on the tenants’ parts.


As all property insurance, rental property insurance offers coverage for the actual building structure and its contents. Rental property insurance can pay for the cost of repairing damaged articles, such as carpets, furniture, curtains, and other house items, caused by guests or tenants.


There are several other types of property insurance available. From small business, to medium enterprise to commercial properties, ‘ there’s a different kind of property insurance coverage for each.


Don’t Guess – Know
You should know what your policy does and – more importantly – does not cover. We recommend that you chat with your Broker to confirm the conditions and exclusions on your policy.


Co-Insurance Clauses
Some property owners only want to insure a property for what they paid for it, which may bring into play a co-insurance clause. This is where the property is insured for less than say 80% of its current replacement cost. A lesser amount of coverage and the insurance company will require you to share in a percentage of the repairs above and beyond the deductible amount.


Premium Factors
Do you live in an area prone to floods? The Insurance Company will cover the property but may exclude flood cover on the policy.


Some policies have different standard excess levels. The excess on a policy is not covered and as such it is a good idea to be sure you know of any hidden excesses that may be on your policy. You will be required to pay the value of any excess on making a successful claim.


What Can I Do to Reduce My Premiums?

It may sound like common sense to have working smoke alarms, but did you know that they can help you to get a lower insurance premium. The same applies for a burglar alarm or an integrated / automated fire alarm system. Even installing more basic security features, such as a deadbolt or mortice lock, can help reduce the insurance quote you receive.


Top Tip: In the world of insurance, insurance companies price your premium based on how much risk they believe that you pose. Reducing your risk, even with the simplest preventive measures, can help drastically lower your risk in the eyes of insurance companies.