Property insurance – cover for your building and your contents
Property insurance is generally divided up into two types of cover – buildings cover and contents cover – and both are essential to ensure your office and all the things in it are properly protected. Buildings cover deals with the bricks and mortar, while contents cover protects the things inside it.
If you rent your office space in a large commercial building then the chances are your buildings insurance is taken care of by the person or company who actually owns the building and it is their responsibility to make sure the building has adequate cover. However, it’s always wise to double check, as, if the building isn’t properly insured, then you may find yourself forking out to pay for any structural damage caused by accidents or natural disasters.
In general, buildings insurance will cover damage caused by fire, floods, subsidence (i.e. where the building starts to ‘sag’ because it has not been built on stable foundations), lightning, storms, and explosions. Not all incidents will be covered, so do make sure you double check the summary of cover when you’re shopping around. It’s also really important to make sure that your office building is valued properly and that you have the right level of cover in the event of a rebuild. If you’re underinsured then you’ll have to cover the difference yourself which could put huge pressure on your cash flow and, ultimately, your business.
Once you’ve got your buildings cover sorted out, the next thing you need to look at is contents cover and this almost certainly won’t be covered by the landlord of your building. This type of insurance covers all the things that are actually housed in the office and includes fixtures and fittings like furniture, computers, filing cabinets, server room equipment, phones, kitchen appliances if you have an office kitchen, stationery and also portable equipment like laptops and company mobile phones. Again it’s really important to take a yearly inventory of your contents and make sure that you haven’t undervalued them. Most contents insurance policies will offer cover up to an agreed limit, but if your contents add up to a lot more than this standard limit and you haven’t paid for extra cover then you are going to be out of pocket if something happens and you have to replace everything. It’s also important to bear in mind that some office equipment will be much more valuable than others. For example if you run a design studio, or you’re an architect, then you’re likely to use expensive Macs rather than PCs, and the cost of replacing them will be much higher. If you’re not sure how to value the contents yourself then chat things through with an office insurance expert and they will make sure you’ve got the right level of cover for your business. They’ll also be able to let you know whether they offer a replacement service, which means brand new equipment will be delivered direct to your office door, or whether they will simply issue you with a cheque for the replacement value. The former option might be great for the convenience factor, but you might like to upgrade or get newer versions of your equipment, in which case a cheque would be the better option for you. Again this is something you can discuss with your provider – at the end of the day, they are there to make sure the options you select are the right ones for your business.
