Commercial property insurance provides coverage for business property from a range of dangers, such as fire, wind, hail, theft and vandalism. As with most policies, however, commercial property insurance has its limits. There are some incidents and items that are not covered—including a building’s foundation.
A building’s foundation and suffer a lot of damage due to fire, floods and other disasters. Common signs that the business’ building has foundation issues are gaps in window frames or doors, uneven floors, sticking doors, and sinking foundation. Foundation issues often arise due to moist soil expanding beneath the foundation, plumbing leaks, low moisture or pre-construction issues.
Losing the foundation of a building can be a devastating loss. Replacing the foundation is expensive and putting operations on hold in order to fix the damage can lose the business a lot of money. This cost is, in part, why commercial property policies typically exclude foundation damage. Commercial property insurance also doesn’t cover normal wear and tear, which often occurs to property foundations after time.
Thankfully, there are ways to get around commercial property exclusions. Most insurance agencies offer endorsements, which is extra coverage business owners can purchase to fill in the gaps left by basic commercial property insurance.
There are two main endorsements you can add to your policy.
Besides foundation, common exclusions for commercial property insurance include:
To cover these items or risks, you will have to purchase a separate policy. Floods and earthquakes are typically excluded from all basic property coverages but is extremely important for businesses in high-risk areas for these dangers.
Common policies business owners add to their coverage are:
Obviously, carrying these coverages can be complicated if purchased all as separate policies. Thankfully, insurance agencies often offer bundles for business owners. There are two main commercial policy bundles: business owners policies and commercial package policies.
A business owners policy (BOP) combines property coverage and general liability insurance for small businesses. Commercial package policies combine the same coverage for larger businesses in high-risk industries. Both policies allow the policyholder to combine commercial coverages into one comprehensive policy that is often more affordable than purchasing coverage separately.