Many non-profits, especially new or smaller non-profits, overlook property coverage when considering their overall insurance program. Unless coverage is required by a lender or landlord the insuring of tangible assets may not even be part of the larger insurance conversation. The reasoning behind the acquisition of insurance coverage for your organization is always the same, regardless if whether you are protecting your organization from a General Liability, Board of Directors or Property claim. Any unanticipated circumstance that can cause your organization a significant financial loss can severely curtail operations or even put an organization out of business.
With this in mind I wanted to describe the basic types of Property coverage available to your organization.
- Business Personal Property Coverage
Business Personal Property (BPP) or contents coverage is the most basic property coverage offered for businesses and organizations. Commercial property insurance protects your company’s physical assets from fire, explosions, burst pipes, storms, theft and vandalism. Earthquakes and floods typically aren’t covered by commercial property insurance, unless those perils are added to the policy. Similar to Personal Property coverage in a Homeowner's policy, Business Personal Property covers nearly all items of value that aren't considered a structure, fixture, automobile, watercraft, or aircraft. This would include items such as desks, chairs, tools, equipment, appliances, furniture, computers etc. BPP also covers Mobile Equipment, which includes items such as Bobcats, forklifts, and other mobile pieces of equipment that aren't meant for use on public roads and are not required to be licensed with the Department of Motor Vehicles. This coverage is restricted to the insured location and a certain (very limited) radius around the location. Some property policies offer coverage extensions for things like property of others in your care custody and control or a small extension of coverage for covered property away from your premises.
- Building Coverage
Building coverage is just what it sounds like, coverage for structures, either owned or where you as lessee are required to cover the building you occupy.
- Inland Marine
BPP coverage only applies for the locations listed on the policy. To have coverage for BPP items when they're away from the insured locations, an Inland Marine policy would be required. Causes of loss (the types of things that can cause damage to your property) are often much more extensive with Inland Marine coverage. Many different versions of Inland Marine exist, and they are used to provide specialized coverage.
- Electronic Data Processing
Sometimes used to cover computers. Data and Data restoration are also covered by this insurance form.
These are just the most common types of commercial property coverage. It is important to consult with a professional in order to have a better understanding of what is or isn’t covered with each type of insurance, how property is valued for insurance purposes and what types of coverage are available.