Here Are Some Things to Consider Before Buying Commercial Property Insurance:
Type of Cover
Many commercial property insurance policies provide a fairly basic form of insurance protection for your property. This is called ‘Fire and Special Perils’ cover.
This usually protects your premises against damage caused by a range of hazards (or ‘perils’) such as fire, lightning, explosion, storm, flood, riot, labour disturbance, impact by vehicles etc.
If your premises are destroyed or damaged, the insurance company will only pay out if you can show that the damage was caused by one of the ‘perils’ listed in their policy. If you can’t do that (and that can happen) you’re not entitled to claim for your loss.
Many professional insurance brokers recommend a higher grade of cover – called ‘Material Damage All Risks’ cover – to their clients. It may cost you a little more – but it’s usually well worth having.
While this wider insurance cover won’t protect you against every type of loss, it helps to plug many of the gaps that can arise with standard ‘Fire & Special Perils’ insurance.
Reducing Your Insurance Premium
If you want to achieve real, long-term savings in your insurance costs, you must do something to make your business more attractive to potential insurance companies.
The best way of doing that is to put in place ‘loss-prevention’ measures to protect your property against loss or damage by fire, theft etc.
Remember: It’s only by reducing the likelihood of claims that you will secure long-term reductions in your insurance bills.
Think about improving your ‘insurance risk’ in one or more of the following ways:
Fire Prevention
- Install a fire alarm
- Fit smoke alarms/ heat detectors
- Provide fire safety training to all employees
- Prevent smoking in the workplace
- Make sure that all electrical wiring meets proper standards and is regularly checked by an approved electrical contractor
- Unplug all electrical appliances when not in use
- Place all rubbish in suitable bins
- At the end of the day, make sure that all accumulated rubbish is properly disposed of
- All fire extinguishers should be regularly tested and properly maintained
Security Precautions
- Install an approved burglar alarm system.
This should:
- Meet NSAI (or equivalent) standards
- Be installed by an approved contractor
- Where possible, the alarm should be backed up by a good 24-hour monitoring system
- Fit external doors with mortise deadlocks
- Install key-operated window locks
- Install CCTV cameras
- Erect security fencing
- Hire security staff (e.g. a night watchman)
Automatic sprinkler systems
- An insurance company will usually offer a good price reduction where the policyholder has installed an approved sprinkler system
- The use of sprinklers offers considerable benefits to both insurance companies and their policyholders:
- The level of fire loss is substantially reduced(To about one-sixth of that where there are no sprinklers)
- 97% of fires in buildings with sprinklers are controlled by fewer than 3 sprinkler heads being activated
