Commercial Property Insurance
Commercial property insurance relates to buildings used for business purposes, such as offices, warehouses, factories and retail premises. It can also extend to contents and stock.
Building owners and tenants often have different insurance responsibilities. Your lease usually spells out who insures what.
Who this insurance may suit
- Owners of warehouses, factories and industrial units
- Investors in office or retail buildings
- Owners of mixed-use or strata commercial property
- Businesses occupying their own premises
- Tenants responsible for fit-out under a lease
Why this cover may be important
Rebuilding or repairing commercial premises can be costly, and tenants may stop paying rent while the building is unusable.
Lenders often require the building to be insured as a condition of finance. Leases may also require owners to hold specific covers.
Potential areas of cover
Cover varies between insurers and policies. Depending on the policy, cover may include:
Building damage
Cover may include damage to the building from insured events such as fire, storm, impact or malicious damage.
Contents and stock
Plant, fit-out and stock may be included, subject to declared values and policy limits.
Loss of rent
Owners may be able to cover rental income lost while a damaged building cannot be occupied.
Public liability
Owners may need liability cover for injury or damage connected with the property, such as common areas.
Debris removal and professional fees
Some policies include costs to clear debris and engage architects or engineers after a loss, within limits.
Machinery breakdown
Optional cover may respond to sudden breakdown of building plant such as lifts or air conditioning.
Common risks
- Fire in a warehouse or factory
- Storm, hail or roof damage
- Burst pipes and water damage
- Vandalism and malicious damage
- Impact from vehicles or forklifts
- Loss of rent after a tenant vacates a damaged building
What may not be covered
Every policy has exclusions, limits and conditions. Some common considerations include:
- Flood cover is not always included and may depend on location.
- Vacant buildings often have restrictions or reduced cover after a set period.
- Building sums insured should reflect current rebuilding costs, including demolition and compliance upgrades.
- Hazardous activities by tenants may need to be disclosed.
- Gradual damage, rust, mould and maintenance issues are commonly excluded.
Always read the Product Disclosure Statement and policy wording. Your broker can explain how they apply to you.
Why work with Tasman Insurance Group
- We take time to understand your business or circumstances before discussing cover.
- Where applicable, we approach suitable insurers and compare the options available.
- We explain exclusions, limits and excesses in plain English before you decide.
- We help with changes during the year, renewals and claims.
Commercial Property Insurance FAQs
Who insures a leased commercial building?
Usually the owner insures the building and the tenant insures their own contents and fit-out. The lease sets out the specific responsibilities, so it is worth checking.
What is a building valuation and do I need one?
A valuation estimates the cost to rebuild. It can help set a realistic sum insured and reduce the risk of underinsurance.
Does commercial property cover include flood?
Some policies include flood, some offer it as an option and some exclude it. The definitions vary between insurers. A broker can talk through your situation.
Can I insure a building that is currently vacant?
Cover may be available, but insurers often apply conditions or limits to vacant buildings. Letting the insurer know about a vacancy is important.
Related insurance solutions
Business Interruption Insurance
Cover that may help replace lost profit and pay extra costs while your business recovers from an insured event.
Learn more about Business Interruption InsuranceLandlord Insurance
Cover options for residential rental properties, including building, landlord contents, rent default and liability.
Learn more about Landlord InsurancePlant & Machinery Insurance
Cover options for mobile plant, heavy machinery and general equipment used across sites and workshops.
Learn more about Plant & Machinery InsuranceBusiness Insurance
A package policy that can bring several types of business cover together, arranged around how your business actually runs.
Learn more about Business Insurance
Ready to talk about commercial property?
Request a quote or call us. We'll ask about your circumstances and discuss the options available.