What commercial property insurance covers
Commercial property insurance protects business premises and what's inside them: the buildings (structure, fixtures, plant) against fire, flood, storm, escape of water, impact and malicious damage; and contents, stock and equipment against the same perils plus theft. Owners insure buildings; tenants typically insure contents and improvements while the landlord insures the shell — check the lease, which usually dictates who covers what.
Insure the rebuild cost, not the market value
Buildings must be insured for their rebuild cost — demolition, materials, labour, professional fees and VAT — which can sit far above or below market value. Get it wrong and the average clause bites: insure for half the true rebuild figure and insurers can halve every claim, not just total losses. A professional reinstatement valuation every few years keeps the number defensible.
Cover for commercial landlords
Landlords letting commercial premises need buildings cover plus loss of rent (rent that stops while damage is repaired), property owners' liability (injury claims from tenants and visitors), and terms that survive unoccupied periods between tenants — unoccupancy restricts cover under most policies, so notify insurers when a unit empties. Mixed-use property (shop with flats above) needs a policy written for exactly that.
Pair it with business interruption
Rebuilding the premises is half the loss; the trade you couldn't do is the other half. Occupiers should pair property cover with business interruption insurance sized over a realistic recovery period — and landlords with the loss-of-rent equivalent.
Getting the right policy
The essentials: an accurate rebuild valuation, lease-consistent responsibilities, unoccupancy conditions you can live with, and interruption cover alongside. A specialist broker will structure it — and for purchases, see our commercial mortgages guide. Find a business insurance specialist through Nesto — free, no obligation.