Insureon Blog

Business Liability Insurance vs. Commercial Property Insurance

18. April 2016 08:03

building and vehicles in flames

Sometimes bad things happen without warning. Take, for example, the CNN report of a massive explosion in Seattle that destroyed a building and injured nine firefighters. The report states the blast was so powerful that windows shattered in businesses as far as two blocks away. The most likely culprit? A natural gas leak.

A quick Internet search shows that gas leaks aren’t as rare as you might think, but this story is just one reason most businesses usually carry both Commercial Property Insurance and business liability insurance. In short, the two types of insurance offer two distinct protections: coverage for your property and coverage for lawsuits. Let’s take a closer look at how these policies can help a small-business owner pick up the pieces after an unexpected disaster.

What Is Commercial Property Insurance?

Commercial Property Insurance is the policy that can protect your business's physical assets, including its building, furniture, equipment, inventory, and more.

This is the policy you turn to when you need to repair or replace business property that is damaged by:

Let’s say your business is the one obliterated by the gas leak in Seattle. Your Commercial Property Insurance may help cover the cost of repairs, making it easier for you to return to business as usual.

Get details about customizing your commercial property coverage in “Property Insurance Coverage: Let’s Get Physical.”

What Is Business Liability Insurance?

Commercial Property may cover the damage to your business property, but what about the damage to your neighbors' property? If explosion is your fault, you could be on the hook for their damages. That’s why it’s important to have business liability insurance, too.

Business liability insurance helps you address the responsibilities you have to the people who come into contact with your business, such as…

Each relationship creates different exposures, so insurance companies offer different types of liability policies to fit those risks. Here's a quick rundown of some liability insurance policies and the risks they cover:

An insurance agent can help you assess your risks and determine which small business liability insurance policies make sense for you.

How to Bundle Your Business Liability and Commercial Property Policies

More often than not, accidents – even the ones that don’t involve explosions – have a bigger reach than you anticipate. A momentary distraction that keeps you from cleaning up a spill or from turning off a faucet can set off an expensive chain reaction where people get hurt and you foot the bill.

Of course, insurance isn't free, but you can reduce your coverage costs by bundling your policies. By combining General Liability and Commercial Property into a Business Owner’s Policy, insurers can often offer these fundamental policies at a reduced rate.

Bundled insurance is a practical way to get your General Liability and Commercial Property Insurance, but you may face other risks that require different coverage. Learn about important business liability insurance in the post “Got a Negligence Claim? Looks Like a Job for Professional Liability Insurance.”


Business Owner's Policy | Errors and Omissions Insurance | General Liability Insurance | Insurance Terms Explained | Professional Liability Insurance | Property Insurance | Small Business Risk Management | Tips for All Small Businesses | Workers' Compensation Insurance

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