Is Your Business Required to Have Fire Insurance?
Fires are one of the most common and costly disasters in Smith Village, OK. Nationally, there were around 500,000 structure fires in 2017 alone, with almost 30% of them being commercial, industrial or public use properties. Fire insurance covers most of these claims.
But is it required? Does it make good economic sense, or are the premiums too expensive to justify it? Don’t premiums keep rising?
The short answer is that you should always have fire coverage. However, it may not always be required.
What Does Fire Insurance Cover?
Virtually all commercial insurance policies will cover fire damage. It’s such a common cause of disaster that a lack of coverage would probably require a special policy. The standard coverage for fires is comprehensive, including:
- Fire cleanup
- Water cleanup
- Smoke cleanup
For business insurance, most insurance companies will recommend a Preferred Vendor that has been vetted and has a proven history of quality and reasonable price. Generally, the full cost of the fire restoration will be covered if you use locally-recognized cleanup and mitigation experts. Cleanup includes repairing the water damage from fire suppression efforts.
What Isn’t Covered?
Small fires that don’t produce a lot of smoke or require water suppression may not produce enough damage to exceed your deductible. You should ask your restoration specialist if it’s going to require a claim. Some cases of arson will also not be covered if you’re involved in any way.
When Is It Required?
If you have a loan or investors, they’ll probably expect you to maintain standard commercial insurance, including fire coverage. Also, if you’re renting your commercial building, the owner is likely to require you to maintain full coverage.
Should You Have It if It Isn’t Required?
Some areas, such as very rural locations, may have such limited resources to fight a fire that insurance rates may not justify the premiums. However, rates for fire coverage in Smith Village, OK, are very reasonable. It makes sound financial sense to carry a commercial insurance policy.
If you have a business, you probably need fire insurance. It’s a pretty big gamble to go without it, and your investors will certainly require it.