Commercial building insurance is insurance that is specifically designed for businesses. So, in essence, it is insurance that covers commercial buildings against any losses that result from things like theft, vandalism, fire and natural disasters. When looking at commercial building insurance, you have to be very aware of what kinds of coverage you are getting. Some types of commercial building insurance protect only the structure of the building. Other types will include protection for furnishings and business equipment. You might even see coverage that extends to personal injury, or death that occurs on the premises.

Commercial building insurance is divided into two basic types of insurance. These are named-peril policies, and all-risk policies. Each is exactly what the name implies.

Named peril policy coverage will protect your property in the event there is an unforeseen calamity. Specific coverage instances are named in the policy document. A named peril policy could be set up to cover damage that results from only fire and explosions, if you so choose. It may or may not include floods and earthquakes. With this type of policy, the only events covered are those specified in the policy.

In writing up a named-peril policy, a list is generated of potential damage causes. These perils will then be listed, and there will be a clause stating any damage caused by something not specifically listed in your policy, will not be covered.

A named-peril plan is the exact opposite of an all-risks plan. All-risk coverage plans protect against all probable sources of damage, except those designated in the policy as a specific exclusion. Floods and earthquakes are generally two such events that might be excluded. However, coverage for these natural disasters can be added into the policy if you wish. An all-risk coverage policy protects business property in the event of an unexpected or unplanned for disaster.

The named-peril coverage plan is more expensive, but that is because it covers so much more. Most businesses find a named-peril coverage policy is more than sufficient, but they generally include a rider that covers flooding. Only the business owner can determine their insurance needs. To a large extent, it depends on the location of the business, as well as the property and equipment involved.

There’s such a wide variety of companies and packages, that most business owners can find a small business package that meets their precise needs. It is important to be mindful, however, when determining what you wish to insure, and for how much. Take stock of your business property, and figure out the value involved. Decide what things need insuring, and what does not need to be insured. When you take stock, be sure to consider the buildings involved, equipment and machinery, inventory, documents and business records. Also, include any databases and vehicles used for the business, as well.

Susan Reynolds is the webmaster for a leading South African Insurance Provider who specialises in Commercial Insurance Policies.