Not all business owners own the buildings where they operate. Given the cost of commercial real estate, many people opt to rent. But, even that can get expensive.
Still, any rental retail space anywhere is a cost to your business. You therefore have to take care of it. What can you do to protect it?
Property Damage Risks in Retail Spaces
You don't own a rental business space. Still, you occupy the space like your own. You need it to work efficiently to keep the business going. There is always a chance that something could happen that damages your operations. When it does, it could also damage the property itself.
Any variety of hazards could impact your business--fires, severe weather, theft, floods, vandalism and more. You might not be able to do much to prevent these hazards. However, there are other risks that you could cause that could damage the property. In these cases, the costs of damage might fall onto your shoulders.
What to do if Damage Was Your Fault
Let’s think about a scenario where you might cause damage to your rental space. For example, one of your machines might overheat, cause an electrical short and start a fire. The smoke, flames, water and more might cause significant damage to the building.
An item belonging to you triggered the fire that damaged the property. The cleanup responsibility might therefore fall onto your shoulders. The property owner might even take you to court for the repair costs. It might be up to your commercial insurance to cover the damage.
But, wait, you might not have structure insurance on a commercial rental policy. How can you pay for these losses? Don't panic yet.
Renters insurance will likely include a section called property damage liability coverage. This coverage applies to the property damage you cause to the property of other people. The building's structure is someone else's property. Therefore, liability coverage can likely help you pay for the property repairs. Since you don't own the property, you pose a liability to the person who does. That's why this coverage might come in handy.
When getting your commercial insurance, make sure you indicate that you will rent a space. Then ask a First Insurance Group agent if your coverage will pay for the property damage to that space. We can help you set up appropriate limits to your own and the property owner's benefit.
Also Read: Common Risks That Your Business Could Face