What is Commercial Property Insurance?

Businesses that own property in New Jersey have invested a significant amount of financial assets into their buildings and land, and those assets need to be protected. Few businesses could afford to replace their commercial property if something happened to it. Commercial property insurance helps make sure businesses don’t have to if their property is damaged in a covered incident.

Commercial property insurance (also known as business property insurance) is somewhat similar to homeowners insurance, except commercial property policies are designed to insure commercial buildings and land rather than personal residences.

Just as homeowners policies usually provide both dwelling coverage and personal property coverage, commercial property policies typically provide coverage for a business’ building(s) and contents kept within the insured building. The list of covered contents may include equipment, fixtures, furniture, decorations, supplies, and inventory, depending on a policy’s terms and conditions.

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Unlike homeowners policies, however, commercial property policies often don’t include liability coverage. While this coverage is commonly part of homeowners policies, businesses frequently must purchase general liability insurance through a separate policy. In some cases, a liability policy may be lumped together with a commercial property policy (and other policies) in a business owners policy, but the property and liability coverages usually remain separate policies with different terms and conditions.

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What Businesses in New Jersey May Benefit from Business Property Insurance?

Business property insurance is typically only needed if a business owns property. For example, a restaurant that leases space in Newark, NJ probably doesn’t need this type of insurance, nor would a store that rents space from a shopping center in Camden, NJ. The businesses that own these buildings that house the restaurant and store would likely need insurance for the buildings, but tenant businesses usually aren’t responsible for maintaining and insuring the buildings they’re in (always make sure to know your situation before assuming which coverages you need).

New Jersey businesses that lease space still may need insurance coverage for equipment, supplies, inventory, and other items. It’s often possible to get coverage through a different type of policy that doesn’t also provide coverage for a building, though -- and, therefore, usually costs less.

What Kinds of Perils Does Commercial Property Insurance Guard Against?

The exact perils that a particular business property policy guards against will depend on the policy’s terms and conditions. Some common perils that many policies provide protection against are:

  • Hail
  • Wind
  • Fire
  • Burglary
  • Vandalism

Some also may provide coverage against freezing water, including freezing pipes and sewer backups.

As is the case with most homeowners policies, few business property insurance policies provide coverage for earthquakes or floods. If a business wants these protections, it will likely need to purchase them as add-on coverages or through separate, specialized policies.

Make Sure You Have the Right Coverage

How Can Businesses Get Business Property Insurance?

Businesses that have property to insure should talk with an independent insurance agent who’s familiar with commercial insurance policies. A knowledgeable agent will be able to review a business’ property in New Jersey, help the business select coverages and find a business property insurance policy that provides the coverages it wants.

Meet Your Industry Specialist

Jeff Kroeger

Principal, Senior Vice President, and Head of Commercial Lines, Mr. Kroeger also manages the company's hospitality book of business and is that unit's primary producer. He is a graduate of Montclair State University and was named a 2015 Young Gun Insurance Business America.

Jeff has been providing exceptional insurance for restaurants, bars, nightclubs, and more for many years. He understands the unique challenges this industry faces and delivers the right coverage at an affordable price.

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