Making a Possessions Claim on Business Insurance

Businesses that have property insurance will likely have coverage for the possessions inside. So, if something damages the contents of the business, then you can likely file a claim for the damage costs. However, you must do so correctly to successfully receive compensation. Some policies will include limitations on how much damage they will cover. 

Understanding Contents Insurance  

Contents coverage is business insurance that will help you replace or repair possessions if they get damaged or destroyed by unexpected events. It might pay when hazards like fires, theft, vandalism or severe weather damage belongings. Some of the items it might compensate you for include:  

  • Computer equipment  

  • Machinery and materials  

  • Furnishings  

  • Business stock and inventory  

  • Equipment 

Restrictions on Your Contents Coverage  

When getting your contents policy, you will choose a maximum limit to your coverage. You’ll want to base this limit on the cumulative value of all your belongings in case a total loss occurs. For example, if a fire destroys your business, and you have $100,000 worth of possessions, you'll need up to $100,000 to replace the items. That will require a $100,000 policy limit. 

Yet, besides the policy limit, there are other restrictions that might affect how and when you can make a claim. Keep these potential limits in mind: 

  • Most contents coverage includes deductibles. You agree to pay this amount towards the cost of repairing or replacing the items. If you have a $1,000 deductible and claim furniture damage worth $5,000, then your policy will only pay you up to $4,000.  

  • Policies might exclude or limit coverage on certain items. For example, outdoor furnishings or signage might have limited coverage. To insure these items, you might need to add a specialty endorsement to the policy.  

  • The policy might include sub-limits that it imposes on certain items. For example, the policy might only pay up to $500 for damaged computers. To get more coverage, see about scheduling the item on your policy through an endorsement.  

  • The policy will not cover contents damaged in certain hazards. For example, weather-related flooding typically does not have coverage. To get such protection, you might need to buy flood insurance. This coverage will still include its own limits and deductibles.  

If you ever need to file a claim on your contents insurance, then immediately call the insurer. They can tell you what they require to process the claim. You might need to take pictures, receive damage estimates and preserve the scene until the insurer can review the damage. All these steps can aid the insurer in providing you ample compensation.