What Factors into Commercial Property Insurance Costs?

At Oliver and Associates, we know that insurance costs can be a big burden for companies of all kinds. Knowing the kinds of factors that affect commercial property insurance costs can help you plan. Whether it’s about workers’ compensation insurance or just the safety of day-to-day operations, knowing more about the potential costs that come with commercial properties is a must.

Location

The location of the building can actually have a big effect on how much your insurance ends up costing. Commercial property insurance protects against weather like lightning, windstorms, and hail, along with environmental hazards like sinkholes. As a result, where your building is located and its surroundings are a factor. Your insurance also protects you against theft and vandalism. As a result, buildings in areas that experience more crime might have higher premiums.

Industry

The industry you’re working in can also affect the price of your commercial property insurance. A manufacturing operation could be riskier and offer more potential hazards to worry about than, let’s say, a typical office environment. The kind of inventory and items being kept inside of a commercial property can also vary based on industry and affect coverage costs. An office might not have inventory, but it does have printers and other equipment that could be stolen. Stores that sell clothing can have inventories that are worth very different amounts. As another example, an electronics store or sporting equipment retailer also would have inventories worth different amounts. The value of what needs to be protected by theft can have a significant effect on your insurance costs.

Safety Measures

Safety measures found in your building can also affect your commercial property insurance costs. Fire alarms, a security system, and sprinklers can all alert you to a problem early and limit damage. Even being located close to a fire station could help reduce how much you pay because it’s more likely that problems at your building will be mitigated by a swift response.

Construction Materials

The materials used in your building can also help determine your insurance costs. A building made with a lot of wood could be more flammable, meaning that your insurer considers it more of a liability. A building made from brick or stone could be seen as less of a risk to insure. A newer building could also mean lower commercial property insurance premiums because plumbing, electric, and HVAC systems are all more likely to be updated, reducing risks.

Future Earnings

A potential problem with your factory can affect future earnings. How much depends on the type of business you’re running and what kinds of products you sell. It might be easy to get a new office space ready to go, but a production line is a different story.

Employees

The number of employees and whether or not they can easily be relocated is also a factor. Workers’ compensation insurance costs are also something to consider.

Your Commercial Insurance Company in Carbondale, IL

So if you’re looking for a commercial insurance company that you can depend on, contact Oliver and Associates. We’ll help you find the insurance solution that works best for your company and your budget.