When you buy commercial property insurance, your policy will apply to various items on your premises. It might insure your building, possessions and equipment. The catch, however, is that this coverage will not apply unilaterally to every asset you own. There will be limits that might leave you exposed to costly effects of property losses. However, you might be able to eliminate many of these by investing in policy endorsements. How do these endorsements work? What are their purposes?
Understanding Endorsements
The basic definition of an insurance endorsement is that it is a change to your policy. By adding endorsements to your commercial insurance policies, you can meet your business's unique needs. Most commercial property insurance policies will need endorsements at one time or another. Indeed, many policies include endorsements from the moment you buy them.
Sometimes, you will add an endorsement to your policy for simple reasons. For example, if you move the business and need to change the address, then an endorsement might be necessary. Or you might need an endorsement for the policy if you build an addition to your original property. However, business owners also often need endorsements when they want to expand coverage to specialty items.
Adding Special Property Endorsements to Your Policy
Under standard commercial property insurance, certain business property might not have enough coverage. Or, it might have no coverage at all. By buying a policy endorsement, you might be able to extend protection to the items in question.
Some of the most common property endorsements are:
- Glass endorsements: Broken glass often is easy to repair. Therefore, some policies limit which types of glass they will cover. With this endorsement, your coverage can extend to most glass within the business.
- Earthquake endorsements: Businesses in areas prone to earthquakes often need this endorsement. Quakes are not usually covered by standard property insurance.
- Equipment breakdown endorsements: Should your equipment suddenly fail you could face a loss of business and high repair costs. This coverage can help you repair the item and recover income lost during a loss of productivity.
- Personal effects coverage: This endorsement will extend coverage to someone's personal belongings kept in the business.
- Papers & records coverage: Most property insurance provides limited coverage for vital paperwork and data. An endorsement can provide more expansive assistance to items vulnerable to losses.
- Outdoor property endorsements: Some items stored outside the business will have limited coverage. You can extend coverage to these items to better cover repairs or debris removal.
Work with your agent to help them understand the full extent of your owned property and assets. They can then help you choose a commercial property policy that is most accurate for you. They will then include the necessary endorsements to provide you the most wide-reaching protection.
Also Read: Understanding the 3 Main Types of Commercial Property Insurance
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