Property damage, lawsuits and theft can be financially devastating for small businesses. Office insurance is a broad category of business insurance policies meant to protect businesses against common risks. A typical business office insurance package would include coverage for business contents (commercial property), public liability, professional liability, and business interruption.
While many small businesses start from home (or the garage), there comes a time when the business and team outgrows the spare bedroom and you need to venture out and lease office space.
At this growth stage, there’s likely a lot for business owners to manage: staffing, securing a favourable lease in a good location, furniture, renovations, and insurance all while running the business. Luckily, many insurance companies make this easy by offering comprehensive business office insurance package policies with coverage for all of the common risks you might face.
Business Property Insurance (Contents)
Many businesses spend a significant amount of money on getting comfortable office furniture and renovating their office space to attract employees and create a positive brand image with clients.
As with any significant asset, prudent business owners should consider purchasing insurance to protect their investment. In addition, many landlords will make carrying business property insurance a requirement in the lease agreement.
Business property insurance (sometimes called commercial property or contents insurance) is insurance for offices. It covers everything within the 4 walls such as furniture, renovations, office equipment, merchandise, etc. Many tiers of coverage are available depending on your specific needs and budget covering just named perils or all risks coverage.
Another important coverage provided by most office insurance packages is office liability insurance. If a client coming in for a meeting slips and falls in your office, the resulting lawsuit to cover their medical fees could be huge. Carrying public liability insurance would protect you against that.
To put it simply, public liability insurance protects your business against any lawsuits alleging bodily injury or property damage. The insurance company will step in and pay for your legal defense (including lawyers fees, expert witnesses, etc.) and if any judgements are awarded against you in court, they would pay for those as well up to your chosen policy limit.
Just like contents insurance, many landlords will require you to carry public liability insurance with a tenant’s legal liability component added on.
While your public liability policy will insure you against most things to do with your legal liability to 3rd parties arising out of your business premises or operations, there is a glaring gap in coverage for many professional firms.
Your public liability policy does not insure you against liability for alleged or actual financial loss, bodily injury or property damage to 3rd parties arising out of your professional activities.
If you provide professional services (ie. IT consulting, marketing consulting, insurance broker, lawyer, medical professional, real estate agent, etc.) you could face severe financial consequences from clients alleging your failure to properly rendering your professional services which is why you should consider professional indemnity insurance.
This coverage is often overlooked because it isn’t as tangible as some of the protection offered by the other policies. The truth is, most businesses can have their operations interrupted by a loss of their tangible property.
When a fire, windstorm, or some other insured peril damages your business property or premises, you may find yourself unable to operate your business. During this period of interruption, you will have reduced revenues but still the same amount of expenses to pay.
Business owners can get covered for this shortfall in revenue through a business interruption policy. Some higher end policies will even pay for extra expenses like renting an alternate location during your period of interruption or paying contractors overtime to expedite business recovery.
Although perhaps your office is not as susceptible to crime losses as a retail store, this is still a major exposure. Someone could steal your equipment, cash, or even forge your signature on cheques.
A typical crime insurance policy offered as part of a business office insurance package would include coverage for things like the theft of cash, burglary, robbery of property your employees take off premises, and even employee dishonesty.
Buying Office Insurance
Package policies make it very convenient for clients to get the coverage they need without having to spend a lot of time on it. That said, not every package is the same and it pays to consult with a business insurance advisor from Trusted Union to help you choose the right coverages for your business, needs, and budget.