Commercial property insurance

If you have business property, taking out a suitable insurance policy will ensure you are covered for damage from a variety of causes. While you should check the policy details carefully, most standard insurance contracts will cover your buildings and premises for a range of risks including:

• fire and lightning
• explosion
• riot
• malicious damage
• storms
• floods
• damage caused by vehicles

Responsibility for insuring business property

If you are a tenant, ask your landlord who is responsible for insuring the premises. Normally the responsibility is with the landlord. The tenant, however, is usually responsible for shop fronts. See commercial property: landlord and tenant responsibilities.

If you are responsible for insuring the property, you could opt for 'all risk' insurance. These insurance policies do not name the risks covered, instead, they list any risks excluded - so all unnamed risks are automatically included. Property insurance policies do not cover:

• wear and tear
• electrical or mechanical breakdown
• any gradual deterioration specified in the policy

You should tell your insurer if your business property is left unoccupied for any length of time. Insurance cover is likely to be reduced to fire only and may not include malicious damage caused by vandalism.

Reinstatement value

You need to insure your business property for the full rebuilding cost, known as reinstatement, rather than just the market value. This is because you will only be able to claim the cost of what you have insured - regardless of the amount of damage.

A chartered surveyor will be able to help you to calculate the reinstatement value. 

As well as insuring the building itself, you should also consider taking out public liability insurance if members of the public visit your premises.

Seeking advice on business insurance

To decide on the appropriate level of cover, you should seek professional advice from a regulated insurance company or broker. Insurance brokers, advisers, and other insurance intermediaries are regulated by the Financial Conduct Authority (FCA).

If you choose to deal directly with an insurer, it's worthwhile checking that they are a member of the Association of British Insurers.