Most business owners agree it’s important to maintain insurance to protect business assets. When thinking about coverage, many consider hazards such as fire, flood or theft at company sites, which are important protections to have.
There are other types of hazards that may not be as high on the list but can cause significant financial loss. Below are five examples that underscore the need for comprehensive business insurance protection.
Company vehicle contents: If you operate a business with employees on the road making service calls, chances are there is valuable equipment contained in the company vehicles. A typical auto policy often won’t cover tools or equipment left in a vehicle, so consider specialized coverage; for businesses with many vehicles, see Commercial Fleet Auto Standard Insurance for related options.
Tenant property improvement insurance: Do you rent space to conduct your business and have you built out the interior or made improvements for your operations? Those tenant improvements can represent a considerable investment, and many standard property policies don’t include their value. If you’ve invested in a build-out, look into coverage to protect those improvements; if you operate a specialized practice, you may find relevant guidance at Dentists, Specialists and Oral Surgeons — Business Property Insurance.
Home-based business equipment: More people work from home at least part of the time. Many assume homeowner’s insurance covers business property kept at home, but homeowner policies generally exclude or limit business equipment. If you keep expensive equipment at home, consider additional coverage or a rider to protect that property.
Business interruption insurance: Natural disasters or other large-scale events can halt operations for weeks or months. Business interruption insurance can help replace lost income and cover fixed expenses while you recover and resume normal operations.
Key person insurance: In many companies, one or a few individuals hold essential knowledge or skills. Key person insurance can provide funds to help a business continue operating, search for a successor, or bridge short-term gaps if an essential employee dies or becomes disabled.
As you can see, many hazards businesses face aren’t covered under a typical insurance policy. Since you invest time, money and effort into your business, it pays to make sure you have the protection you need — if you’d like to talk to an agent, they can review options with you.
Frequently Asked Questions
Does my standard business property policy cover tools in my work vehicle?
Often it does not; tools and equipment in vehicles may require separate inland marine or commercial auto equipment coverage.
Are tenant improvements automatically insured by the building owner’s policy?
Not always—tenant improvements are frequently excluded from the landlord’s policy, so tenants should consider their own coverage or negotiate protection in the lease.
Will homeowner’s insurance cover my home office equipment?
Homeowner policies typically limit coverage for business property, so you may need a business endorsement or a separate policy for significant equipment.
What does business interruption insurance typically replace?
It usually replaces lost income and helps cover ongoing fixed expenses while your business recovers from a covered loss.