Understanding Property Coverage

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Your property needs protection, whether it's your home and collection of watches, art, and sports memorabilia or your business location, goods, and inventory. Luckily, property coverage is designed to protect your property if something goes wrong. Which type of property insurance is right for you? Let's take a look at the most common property insurance policies.

Understanding Commercial Property Insurance

Commercial property insurance is a type of property insurance policy that protects business owners from financial loss resulting from damage or destruction to property owned by the business. Commercial property insurance is also referred to as commercial property coverage or commercial property and casualty insurance.

What does commercial property insurance cover?

The type of property insured under a commercial property insurance policy can vary depending on the nature of the business. For example, in industries such as manufacturing, it is typical for a commercial property insurance policy to cover any equipment or machinery used in the manufacturing process.

Commercial property insurance may also cover the business's inventory, raw materials, work in progress, and finished goods.

If a fire or other disaster were to break out at a business location, commercial property insurance is intended to help compensate the business for any loss of business income resulting from the inability to use its facilities.

If an insured loss results in the interruption of business operations, business income coverage may help offset any lost income that results from being forced to close down one or more facilities for repairs or rebuilding after a disaster strikes.

In addition, it may help cover any additional costs incurred by the business as a result of being forced to use a temporary location after a disaster strikes their primary location.

How does a commercial property policy work?

Commercial property insurance works like most other types of insurance policies. The policyholder pays an annual premium in exchange for the right to receive compensation if certain events occur. These events are known as covered losses and typically include losses due to fire, windstorms, vandalism, and theft.

Note: be sure you understand what your policy covers and what it excludes. You may need additional coverage for floods and earthquakes, which are routinely excluded. Your policy may also exclude business losses arising from a pandemic or intentional acts.

Understanding Homeowners Insurance

Homeowners insurance is a type of property insurance that covers a private residence. It is an insurance policy that combines various personal insurance protections, which can include:

  • damage or loss of one's home
  • damage or loss of your personal property and possessions
  • liability coverage for accidents occurring at the covered location

What does homeowners insurance cover?

Homeowners insurance is meant to cover your home against such perils as fire, wind and hail, and vandalism. However, check your policy for exclusions. Some common risks, such as earthquake and flood damage, will likely be excluded and require a separate policy.

Your homeowners policy isn't intended to cover personal belongings when they are away from home, either. For example, the policy would not cover items stolen from your car or personal items damaged while in storage.

Check with your agent if you have additional questions about what is covered. Your insurance agent can explain your policy in more detail and help you decide what coverage is best for your situation.

How does homeowners insurance work?

Homeowners insurance policies limit how much they will cover if a covered peril occurs. The limit is usually expressed as a dollar amount or a percentage of the value of your home. Your policy will also state a deductible amount, which is the amount you pay out of pocket before your insurance coverage will kick in to pay for damages. If you have questions about policy limits or deductibles, talk with your agent or insurance company representative.

Understanding Renters Insurance

What if you don't own a home or a business? You can still get property coverage to protect your belongings. Renters insurance protects your personal property against a variety of covered risks.

What does renters insurance cover?

You can purchase a policy to cover your personal belongings in a rented home, apartment or condominium. The coverage will vary depending on the policy. For example, most policies provide coverage for damages due to fire, smoke, vandalism, and theft.

Just like other commercial properties, your rental policy won't cover every possible disaster. You can also purchase additional coverage to protect against common exclusions such as floods, earthquakes, and hurricanes.

Some policies may even cover your personal belongings when they are away from your home. For example, you may be covered if your laptop is stolen from your car while you are parked at the mall.

How does renters insurance work?

Just like other forms of property insurance, your renters insurance policy is a legal contract where you agree and your insurance carrier agree on:

  • The amount of your annual insurance premium (what you pay for the coverage)
  • What perils are covered
  • What perils are excluded
  • The specific property covered/ excluded
  • What your policy limit is (how much your carrier will pay per incident/ annually for losses)
  • The amount of your deductible (what you're responsible for paying before insurance kicks in)

Ask Your Insurance Agent How to Protect Your Property

Insurance is the best way to protect the belongings and building structures that you've invested your money in. From speakers and stereo equipment to manufacturing machines and inventory, property insurance is there to protect you against financial losses when something unexpected occurs. Call your trusted insurance agent today to find out just how affordable protecting your property can be.

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