At Crusberg-Decker Insurance Services, Inc., we understand that risk management plays a vital role in the long-term success of your business. Likewise, we recognize that one of the most important risk management strategies is to have comprehensive commercial insurance coverage. More specifically, having a commercial property insurance package that protects your physical assets may be your business’s best defense against loss.
Protection for Your Physical Assets
Consider the amount of money you have already invested into your business. The purchase of your commercial space, the cost of your equipment, and the time and money spent building your inventory are all investments you’ve made into a company you believe in. Now, imagine if you lost those assets. Could your business continue to function if your equipment was stolen? What if a pipe burst and your inventory was lost? If a fire damaged your commercial space, could you ever financially recover? For large and small business owners alike, these questions should be considered.
What Commercial Property Insurance Covers
As the name suggests, commercial property insurance covers the physical space on which your business exists. It protects your commercial real estate—including the building’s structure, landscaping, signage, fencing etc.. But, commercial property insurance also protects the following physical assets at your company:
- Computers and electronics
- Important documents
How Compensation Is Calculated
There are essentially two methods that insurance carriers may use to calculate the amount that you’ll be compensated for loss:
Replacement cost (RC):
A policy that provides RC compensation will reimburse you for the cost of your lost assets without taking depreciation into account. For example, if 10 years ago, you bought a piece of equipment for $5,000, that is the amount you would receive if the equipment was stolen or damaged in accordance with the stipulations of your policy.
Actual cash value (ACV):
For a lower monthly premium than an RC policy, a policy that provides ACV compensation takes depreciation into account when determining compensation payouts.
To make your commercial property insurance work for you at a minimal cost, it’s important to take a complete inventory of your physical assets and determine if an RC or ACV policy makes the most sense for your business. Additionally, consider including commercial property coverage as part of a comprehensive business owners policy (BOP). Contact Crusberg-Decker Insurance Services, Inc. by calling 800.640.1712 or by filling out the form on this page.
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