Commercial Earthquake Insurance is a type of property protection that is designed to cover the business owner’s against losses arising from earth movement. Generally, losses due to an event of an earthquake are a general exclusion from all property insurances, except for damages due to fire. Business Earthquake Insurance is available to buildings that are generally used for business purposes, including condominiums.
In most cases, Earthquake Insurance could be purchased on a stand-alone policy. Also, as an endorsement to an all-risks policy or a Difference In Conditions (DIC) policy. Moreover, it can also be purchased as an additional endorsement to your existing Business Property Insurance.
Typically, Earthquake Insurance policy is subject to Per Occurrence and a General Aggregate limit. And a separate deductible for this insurance policy may apply. Typically, the cost of Commercial Earthquake Insurance varies by state and the location of the property.
Earthquake Insurance policy could provide payments for the repair of the business premises that is damaged due to the seismic activity. In most cases, the rate of Commercial Earthquake Insurance policy is based on how much it will cost to rebuild the property after an earthquake. For further illustration, suppose that the commercial property could cost $190 per square foot for the structure to be rebuilt, which could increase or decrease depending on its worth over time. The insurance professionals and insurance carrier will take time and use other tools to rate the property accurately. The rate of commercial earthquake insurance usually depends on the areas of the country where the business is situated. Also, other factors including the building’s age is also a great factor that can affect your business insurance rate.
This coverage could help pay for the damages to the properties of the insured business to rebuild after an earthquake. It could help pay for the damaged furniture and fixtures due to the earthquake.
Additionally, it could also cover the properties of the business that is within the 100 feet parameters of the insured commercial building. This could also cover other types of business properties, unless it is otherwise listed on the declarations of the insured, including:
Loss of Income or also referred to as business interruption could also be covered under this policy. However, some insurance providers do not include this coverage to the Earthquake Insurance policy that they offer. Therefore it is much better to consult our insurance solutions about the coverage of your policy.
Loss of Income coverage would cover the insured business against income losses, should the business stop its operation. This coverage could provide the income that the corporate should have earned, for the time the business premises are being repaired.
Ordinance or Law Coverage may provide an additional cost of repair if your building procured damages up to a specific extent. Usually, in the United States, if the commercial building incurs earthquake damages for more than 50%, the building must be demolished.
Also, the building must be rebuilt not on its way before the damage occurs, but in accordance with the current building codes. For example, the commercial building that has been damaged by the earthquake does not have an elevator on it. In the current building city codes, your building has to be upgraded. With this endorsement, the expenses to keep your building up to code would be covered.
An unendorsed Commercial Earthquake Insurance policies do not provide coverage for any portion of the building that was undamaged by the earthquake. With this coverage, the cost to demolish the undamaged part of the building is covered. Also, the cost of debris removal and the cost to rebuild the building up to the current building codes is covered.