What does business property insurance cover in Tennessee?

I just opened a small business in Tennessee. I’m renting a space and have purchased some furniture and equipment. What will my business property insurance cover? What are the benefits of having business property insurance in Tennessee? What are the risks of going without it?

Answer:

Business property insurance in Tennessee offers broad coverage for a wide variety of property claims that can occur. Most basic business property policies will cover the following perils, or causes of loss:

  • Burglary and theft: Burglary and theft are two of the most common business property claims. A typical business property policy would cover most burglary or theft claims. 
  • Wind and hail damage: Wind and hail damage are typically covered claims on a business property policy. If you live in certain coastal areas, however, wind damage may be excluded from your policy, but you can purchase a wind endorsement. Note that you may be required to have separate hurricane deductibles and other special policy provisions in areas that are prone to hurricanes. Your independent insurance agent can help you get the hurricane coverage you need if you live in one of these areas. 
  • Fire: Fire is one of the most costly business property claims, and is covered under a commercial property policy. 
  • Water damage and freezing: Water damage can be caused by floods, hurricanes, burst pipes, or a simple leaky toilet. Like your home, your business is susceptible to numerous kinds of water damage, not all of which are covered by your business property policy. There is no standard for water damage coverage so you need to carefully read through your commercial property policy to understand what is covered and what is not. Here are some examples of what is usually covered:
    • Burst pipes. Commercial property insurance will usually cover water damage due to burst pipes. But if your insurance company feels that you were at fault or failed to take precautions to protect your pipes, your claim could be denied. 
    • Slow leaks. Plumbing or HVAC leaks are common and can cause a lot of damage. Damage from leaks that are deemed to be sudden and accidental will be covered by your business property policy. If your insurance company feels that you have been negligent (perhaps you failed to fix an ongoing leak or properly maintain your building systems), your claim can be denied. 
    • Roof leaks. If your roof leaks and the roof as well of the interior of your building sustain damage due to a covered peril — wind, rain, hail, or fire — the damage will likely be covered by your business property insurance policy. If the leak and subsequent damage are because you did not properly maintain your roof, your claim will likely be denied. If your roof damage is caused by a flood (e.g., storm surge during a hurricane), your business property policy will likely not cover it.  

What are the benefits of having business property insurance in Tennessee?

A: Business property insurance is one-half of a basic business insurance portfolio. It provides coverage for many of the most common types of business insurance claims. 

Commercial property insurance in Tennessee protects buildings and their contents, including computers, office equipment, furniture, artwork, and all of your business personal property — whether it is owned or leased — if it is damaged by fire, smoke, theft, vandalism, weather, or certain other covered perils. 

If you own your building, your business property insurance covers damage to the structure and what is inside, and if you lease your space, you need this coverage for your business personal property.

Is There Any Additional Coverage in Tennessee?

A: Business property insurance in Tennessee typically also includes business interruption coverage. If you sustain covered damage that forces you to temporarily close or relocate, business interruption coverage will reimburse you for ongoing expenses (rent, salaries, etc.) and lost income during the closure or relocation period.

What are the risks of not having any business property insurance in Tennessee?

A: Going without property insurance for any business with physical assets can be extremely risky. Without business property insurance in Tennessee, how would you recover if a fire or a storm destroyed your business, or even a part of it? Could you replace your inventory and equipment? How would you pay your bills if you had to close in order to rebuild?

Who Is Business Property Insurance Designed to Help in Tennessee?

A: Business property insurance is important for any business owner who wants to be able to recover after a disaster. It may be the only financial backup you have when you need it most. 

Author | Ann Herro

Article Reviewed by | Paul Martin


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