Every business owner needs to manage risk and getting the right insurance is one of the key ways to manage them. The right protection will ensure the organisation can prosper, no matter what fate has in store. Therefore, finding the right cover is essential. However, the process can feel a little overwhelming – especially if you’re a new business owner.
To get you on the right path, we have prepared this brief overview of building insurance. With this foundation, you can find the commercial insurance protection you need at a price you can afford. With this cover, you can make sure you’re legally compliant and low risk – ensuring things are plain sailing for your organisation.
The different types of building insurance
The type of insurance you buy will depend on a number of factors, including the business niche or sector, industry, and assets. Broadly speaking, the most common types of business insurance are as follows:
General liability insurance covers liability for third-party injuries and third-party property damage. Also usually covers marketing disputes like defamation or copyright infringement.
Business owner’s policy (BOP) combines general liability insurance with commercial property insurance. This cover is usually more cost-effective than purchasing two policies separately.
Commercial property insurance covers the repair or replacement of stolen, lost, or damaged business property, including inventory, equipment, and furnishings.
Business interruption insurance may be included in a BOP or commercial property policy. This will cover operating costs if your business is forced to temporarily close due to a natural disaster or other unexpected events.
Find out what insurance is legally required
Building insurance may not just be a good investment for you – it may be an obligation. Depending on your sector, clients, and creditors, you may be required to have a certain amount of coverage. For example, if you’re renting a commercial property, the landlord may require a general liability policy to cover third-party claims for bodily injury or property damage. Mortgage lenders often have similar requirements for business property owners.
Client contracts may also require a certain level of coverage to give customers peace of mind in the event of a worst-case scenario. Research the legal obligations for your sector to ensure you have the right cover. An experienced insurance broker can advise you on the coverage you’ll need.
Don’t cut corners, get covered
Once you have identified the policy you need, the next question is usually cost. Certainly, keeping costs under control is important, it’s important to realise that building insurance plays a crucial role in protecting your organisation from financial trouble.
It can be tempting to pick the cheapest policy, but that could actually cost you more in the long run. Cheaper policies are cheap for a reason; they may offer very limited coverage that leaves you vulnerable to risk. Inadequate cover is the most common way insurers will try to wriggle out of claims, so make sure you don’t get caught out.
Make sure you get the right advice
Policies vary hugely, and each one has its own limits, premiums, deductibles, and exclusions. Make sure you understand what is covered under a policy before you buy it, although the process can be confusing. The key is to consult with an experienced insurance broker to make sure your cover is comprehensive.