Building Owners Insurance Basics

If you own a building in the Commonwealth of Massachusetts it is crucial that you have the proper building owners insurance policy in place in order to protect your assets. Building owners insurance, also referred to as commercial property insurance, protects both your building and its contents against damage or destruction. This includes coverage for any outdoor equipment and fixtures. The bottom line is that property damage and destruction can occur at any time, and you need to ensure that your assets are fully protected.

That makes building owners insurance a much needed investment. You just never know when an accident, fire, or storm will happen. Although building owners insurance coverage differs from case to case, it is typically categorized by the type of things that occur to cause the damage or destruction, which is also known as loss. A fundamental building owners insurance policy covers any losses that are caused by explosions, damage from vehicles, fires, theft, and vandalism.

Commercial property owners should also purchase endorsements, which are basically add-on policies that protect against earthquakes, hurricanes, and hail storms that can lead to broken glass. Your building is covered under the basic policy and the added endorsements as well as any damage or destruction to office equipment, outdoor items, and inventor that is located on the grounds. Speaking of inventory, it is always a smart idea to take inventory of your building and building related assets. That will go a long way in determining the value of the replacement costs if any of your assets are damaged or destroyed.

It will also help determine the exact items that you would like to have covered in the insurance policy. Some items may not be worth insuring compared to the costs to insure them. That being stated, you should write everything down and then determine the coverage when meeting with your insurance agent. At this point you may be curious as to how your items are covered under the policy. Building owners insurance actually pays you for your losses in one of two ways. For example the policy will either pay the replacement cost of the asset, or the actual cash value of the asset.

The replacement cost is based on the amount of money needed to either repair, replace, or re-build the property. It factors in the use of materials of comparable cost and quality and does not deduct any money for depreciation. On the other hand, actual cash value is the cost to replace the asset with a new asset that is as similar as possible to the quality and style of the original assets minus any depreciation. It is important to note the policy costs are typically lower for the actual cash value option due to the fact that the limit amounts only take the depreciated value into account.

If you own a commercial building in the Commonwealth of Massachusetts you need to ensure that you have the proper insurance policies in place. Please consult with a professional insurance agent that specializes in providing commercial business related insurance policies. It is important to fully understand exactly what you are buying when it comes to your insurance policies. If you have any questions, please call (508) 831-0133 to contact an associate at Zawada Insurance. We are happy to walk you through the details of your insurance policies and explain your coverage options. We look forward to helping you with all of your personal and or business related insurance needs now and in the future.

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