Business renters insurance refers to any policy or combination of policies that protect businesses that rent property, such as offices, storefronts, or warehouses, against certain losses and damages.

Depending on the coverage you want from business renters insurance, a policy could include any or all of the following types of insurance:

The business renters insurance coverage needed will be largely specific to your operations and the space you’re renting. On the whole, a business renters insurance policy should protect your business from claims and damages related to the property, ideally including:

Generally, a standard business insurance policy won’t cover all of these different instances, which is why business renters insurance is typically a customized policy or a combination of standard policies.

As an example, if you own a manufacturing business and are renting a warehouse to store equipment and inventory, you’ll likely need a business renters insurance policy that focuses not only on protecting the business from damages made within the space but also from damages or loss of the inventory and equipment stored there.

If you own a small consulting agency and rent office space, you’ll likely want business renters insurance coverage for accidents and injuries within the space and damages to the property, as these types of claims could be the most costly for a business.

Cost of business renters insurance

Assuming that you’ll want a business renters insurance policy to include everything covered under a BOP, you can use the average cost of a BOP to get an idea of your costs. A BOP costs an average of about $1,200 annually, according to insurance marketplace Insureon.

The cost of your business renters insurance coverage will depend on a variety of factors, including business size, equipment, number of employees, and location. The larger businesses are and the more exposure companies have to certain risks, the higher rates will be. Getting additional coverage will also increase costs.

Replacement cost vs. actual cash value

Another important consideration when it comes to the cost of business renters insurance is replacement cost vs. actual cash value.

If your policy uses the replacement cost method, it will cover the cost of restoring or repairing property to the original state, including labor, materials or actual property replacement. With the actual cash value method, it will pay to repair or restore damaged or lost property but will deduct some of the cost to account for depreciation. You’ll receive compensation for what the property is worth at the time of the claim, as opposed to when it was originally purchased.

Replacement cost commercial property insurance is more expensive than actual cash value coverage, but if you have expensive equipment or inventory that you need to protect, paying for it may be worthwhile.

How to get business renters insurance

There are typically three different approaches you can take to find the right insurance policy for your business:

 The Hartford

Hartford is known for its BOP, which includes general liability insurance commercial property insurance, and business income insurance, also called business interruption insurance. This policy is designed to protect your business and the spaces you own or rent from fire, theft, lawsuits, and more. It’s also customizable and you can easily add data breach insurance or professional liability insurance to expand coverage.

Hiscox

Hiscox provides insurance for a variety of small businesses and offers options to customize a BOP. Usually, a business owner’s policy from Hiscox combines general liability and property liability coverage, which will protect your furniture and equipment at up to five different office locations. Hiscox gives you the option to customize your policy by adding office insurance for fire and business interruption, electronic data loss insurance, hired or non-owned vehicle liability insurance, commercial crime insurance, and terrorism coverage.

Chubb

Chubb offers impressive coverage for businesses with international interests with a customizable business owner’s policy, which combines general liability and commercial property insurance. It also offers a significant number of enhancements that can be added to create coverage for exactly what your business needs. In particular, Chubb offers property enhancements, earthquake coverage (in certain states), equipment breakdown, and crime coverage.

Many renters are under the impression that their landlord’s insurance policy will cover their belongings, unfortunately, that generally is not the case. Your landlord’s policy covers the building itself, but it may not include your personal belongings, and may not cover injuries sustained within the structure. That’s where renters insurance comes in.

Renters insurance protects your personal property in a rented apartment, condo or home from unexpected circumstances such as theft, a fire or sewer backup damage – and will pay you for lost or damaged possessions. It can also help protect you from liability if someone is injured on your property.

Renters insurance is similar in scope to homeowners insurance, with the exception that it does not provide coverage for the dwelling itself or other structures.

How does renters insurance work?

If you experience a covered loss in your rented space, renters insurance can help to cover the associated costs. The amount covered will depend on the type of loss that occurred and the amount of coverage you have.

There are two types of coverage options under a typical renter’s policy: Actual Cash Value coverage and Replacement Cost coverage. Here’s the difference between the two:

What does renters insurance cover?

A renters insurance policy offers you coverage for the loss or destruction of your personal belongings in the event of a covered peril such as:

What does renters insurance not cover?

Now that you have a basic idea of what renters insurance covers, it’s important to understand what a basic renters insurance policy does not cover so that you’re prepared:

Find out more about the benefits of renters insurance and sign up for a free online consultation with one of our attorneys today. Also, remember to always make sure to thoroughly read through your policy so that you have an understanding of what is and isn’t covered.