Minnesota Department of Commerce
Property insurance protects owners from losses due to damage to physical space or equipment, and as a result of theft. For insurance purposes, a business' property includes the physical building in which it resides, as well as its other assets.
All of the following, owned or leased, can be considered business property:
- The actual building
- Furniture, equipment and supplies
- Computers and other data processing equipment
- Valuable papers, books and documents
- Artwork and antiques
- Television sets, VCRs, DVD players, satellite dishes
- Signs, fences and outdoor property not attached to a building
- Non-tangible items such as trademarks and copyrights
There are three types of property insurance plans:
- Basic form, which includes losses resulting from a fire, lightning, windstorm, hail and explosion, plus the cost of removing property to protect it from further damage.
- Broad form, which includes basic plus extended coverage for other types of perils, such as a roof collapse (e.g. caused by snow or ice), riot and civil commotion, etc.
- Special form, which includes basic and broad, and covers all direct physical losses except conditions specifically excluded as listed in the policy.
Actual cash value insurance reimburses for the value of lost, damaged, or stolen goods after depreciation is taken into consideration.
Replacement cost insurance reimburses the amount it would take to replace, rebuild, or repair damages with materials of similar kind and quality, without deducting for depreciation.