When running a business, you must understand how to bounce back from natural disasters like fire and how Business fire insurance works.
You may wonder, “What type of insurance protects your business from fire damage.”
This article explains everything you need to know about business fire insurance.
Which Insurance Covers Your Business Fire Damages?
Fire damage is among the most frequent business insurance claims in 2023.
Here are some of the insurance policies that can cover business fire damages.
Commercial Property Insurance
Commercial property insurance covers fire damages.
When fire outbreaks in your business, you can face damage to goods and property. If you have commercial property insurance, you can get your goods compensated.
Commercial property insurance also covers the premises of the business and your equipment.
Commercial property insurance will compensate you for any losses or damage caused by a fire incident.
General Liability Insurance
General liability insurance will cover third-party injuries, property damage, and defamatory-related lawsuits.
A general liability insurance policy will also cover third-party injuries caused by fire outbreaks.
Business Owner’s Policy
A business owner’s policy combines commercial property and general liability insurance into one policy.
A business owner’s insurance policy covers your equipment in case of a fire outbreak.
The policy will also cover your customers’ property or goods that were damaged in the fire outbreak.
However, it is essential to note that not all entrepreneurs qualify for a business owner’s insurance policy.
Commercial Auto Insurance
Commercial auto insurance covers your business vehicles in case of a fire outbreak on your premises.
This policy is essential for businesses that have a higher risk of wildfires.
Business Interruption Insurance
Business interruption insurance policy covers losses if your business is forced to close due to fire damages.
Some of the expenses covered by this insurance policy include rent costs, employee salaries, debt payments, and relocation costs.
Principles of Fire Insurance
The principles of fire insurance include;
- The principle of indemnity
- Insurable Interest in fire insurance
- Warranties in fire insurance
- The doctrine of subrogation
- The principle of good faith in fire insurance
- The proximate cause of fire insurance
What is the Difference Between Marine Insurance and Fire Insurance?
The significant difference is that fire insurance covers the damages caused by the fire, while marine insurance covers the risk of goods damaged during transportation.
With fire insurance, you are not guaranteed that your business will ever catch fire, while with marine insurance, the occurrence of an event remains unpredictable.
With fire insurance, premiums are based on the property value, while with marine insurance, premiums are sed o the shipping route and the type of cargo.
In addition, fire insurance is purchased on a one-time basis, while marine insurance is bought on a lump sum basis.
Entrepreneurs need to get fire insurance for their businesses.
Business fire insurance can help you cover damages, injuries, and losses caused by a fire outbreak.
Consult with your insurance agent to guide you on the best fire insurance for your business.