Property Liability Insurance

 

Property Insurance is any type of commercial insurance that reimburses an insured party who has suffered a financial loss because property has been damaged or destroyed.

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• Property is considered to be any item that has value and can be classified as real property or personal property. Real property is land and the attachments to it, such as buildings. Personal Property is all property that is not real property.

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• The Building and Personal Property coverage form is used to insure almost all types of commercial property.

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• The insuring agreement in the Building and Personal Property coverage form promises to pay for direct physical loss or damage to covered property at the premises as described in the policy under covered cause of loss.

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• Coverage for the building includes the building and structures, completed additions to covered buildings, outdoor fixtures, permanently installed fixtures, machinery and equipment. The building material used to maintain and service the premises is also insured.

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• Business Personal Property owned by the insured party and used in business is covered for direct loss or damage. This type of commercial insurance policy is also intended to protect against loss or damage to the personal property of others while in the insured party’s care.

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• Basic property insurance policies are written to cover fire, lightning, explosion, windstorm, hail, smoke, aircraft or vehicle damage, riot or civil commotion, vandalism, sprinkler leakage, sinkhole collapse and volcanic action.

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• Other property insurance policies add coverage for water damage, weight of snow, ice or sleet, breakage of glass and coverage for falling objects.

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• Most commercial insurance companies use two approaches to determine value of a property:

  • The replacement cost of a property is the cost to replace it with new property.

  • Actual cash value (ACV) is replacement cost, minus the accumulated depreciation for age and condition.