What is contents insurance for a commercial premises?
Contents and buildings insurance are two separate types of insurance, however they generally go hand in hand. Buildings insurance covers the building itself, whereas contents insurance is designed to cover you if the equipment and other contents of the building become damaged, stolen, lost or broken, so you won’t be out of pocket. It’s highly recommended you have contents insurance for any building which is used for the purposes of running a business, regardless of whether you own or lease the commercial premises you work from.
What does commercial contents insurance cover?
Everything contained within your commercial premises costs money and is expensive to replace. From tools and machinery through to office equipment and computers, it’s important to make sure you have adequate cover in place should the worst happen. When it comes to protection, there are two different options:
- Replacement as new – this is the simple replacement of anything that has been stolen, lost or damaged beyond repair with a brand new one.
- Indemnity basis – this takes into account the wear and tear of a lost, damaged or stolen item and replaces it at its current value.
In addition, you may need to consider your stock. What value of stock do you hold on the premises? Is it likely to be attractive to thieves? For example, a retailer with alcohol and tobacco on the premises will need to recognise that these are potentially attractive targets to thieves and ensure that adequate protection is in place. You may also need to think about stock when in transit – for example, when being shipped out to customers. A Goods In Transit policy may be appropriate as an ‘add on’ in this situation.
Types of commercial property
There are many different types of commercial property that you will need to have contents insurance for. These include:
- Cafés, takeaways and restaurants
- Shops and retail outlets
- Medical establishments
- Offices and warehouses
- Nursing / care homes
- Sports and leisure facilities
Naturally, a commercial contents insurance policy will need to reflect your business. If you run a manufacturing business, it’s likely that you will have expensive, business critical plant and machinery that should be insured. If you run your business from an office, it may only be office furniture and IT equipment. It’s worth speaking to an advisor, who will take time to understand your business and ensure that an appropriate level of cover is in place for your business property.
Business Interruption Insurance
Business interruption insurance will protect you if you can not run your business properly due to the damage or loss of vital equipment. If your income and profit is affected, good business interruption insurance will reimburse you for any lost revenue.
Why is business contents insurance important?
Whether you work from home or have your own premises, if something happened that meant you lost everything you rely on to run your business, it would likely have a drastic effect on your output and profitability. Not only could it lead to spiralling replacement costs but it could also take time to get you up and running again. This is where a business contents insurance policy comes in to play.
What other types of business insurance will I need?
In addition to contents insurance (and buildings insurance if you own the property), you may well also need several other types of business cover as well. The main ones are:
Public liability insurance
Vital for any business, public liability insurance will protect you if someone claims to have had property damaged or been injured as a result of your business.
Employers’ liability insurance
If you employ staff or contractors, it’s a legal requirement to be properly covered by employers’ liability insurance. It’s designed to protect against claims from employees who’ve been injured or become seriously ill as a result of working for you.
Professional indemnity insurance
Any businesses that offer advice or services to other businesses should have professional indemnity insurance. It will cover you if somebody makes a claim against you by alleging that you’ve given them poor service or bad advice that has caused them to lose money as a result.