Don’t let your business sink. Safeguard your investment with commercial flood insurance.
Is your business protected with flood insurance?
As with homeowners insurance policies, many business owners don’t realize that their commercial property insurance doesn’t necessarily cover flooding. Suffering a flood can wipe out a business because it’s not just a matter of replacing damaged equipment and repairing buildings, but also the sheer time it takes where the facilities can’t be used.
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Building Coverage
Risk Factor
Floodwaters can cause severe structural damage to commercial buildings, including foundations, walls, and load-bearing systems, resulting in costly repairs or rebuilding.
Solution
Building Coverage for your commercial structure helps cover the cost of repairing or rebuilding flood-damaged walls, foundations, and structural components so your business can get back on its feet.
Inventory & Stock
Risk Factor
Items such as inventory, stock, raw materials, or finished goods can be washed away, damaged, or ruined by rising or fast-moving water.
Solution
A commercial flood policy can protect your business's belongings through the Personal Property coverage part of the policy.
Electrical
Risk Factor
Electrical systems can be particularly vulnerable to water damage. Losing power is not only expensive, but may also limit your ability to operate.
Solution
Electrical and plumbing are both covered under the Property part of a flood policy, giving you a needed boost to recover from this type of damage.
Equipment & Machinery
Risk Factor
Important business equipment like sawmills or manufacturing machines can be damaged by objects in flood waters or break down when submerged.
Solution
The Personal Property section of a commercial flood policy helps cover damage to business-owned machinery and equipment to help get your business back on track.
Personal Belongings
Risk Factor
Businesses are more than just buildings. Furniture, chairs, bookshelves, and all of the other items we surround ourselves with while we work are important parts of the business you've built.
Solution
Flood policies cover most “personal” objects owned by your business under the Personal Property coverage, helping you rebuild your work life, not just your work space.
Consider the risks of flood damage.
It’s important to note that with commercial properties, sudden excessive rainfall isn’t necessarily the biggest flood risk. You must also factor in drains getting clogged, which can turn a normal rainfall or snow storm into an unexpected catastrophic event. Just because your business isn’t in a flood zone doesn’t make it immune to flooding. Having commercial flood insurance may help to keep your business running, even after a catastrophe.
Why you should get covered for floods sooner rather than later.
In some cases, flood insurance policies don’t take effect until after a 30-day waiting period, so it’s not smart to wait until heavy rain is forecasted where your business is located.
Should you choose an NFIP or non-NFIP policy?
As a business owner, you’ll need to look at both commercial flood insurance offered through the federal National Flood Insurance Program (NFIP) and commercial flood insurance coverage from non-NFIP policies. The two big advantages of non-NFIP policies are that they may pay out full replacement costs (whereas NFIP payments account for depreciation), and they may include coverage for loss of business during the rebuilding phase (loss of business is not covered by NFIP).
What are the risks of not getting commercial flood insurance?
At least 25 percent of businesses that close after destructive events such as floods never reopen. You don’t want that to happen to your business. It’s important to have a policy that will protect your business, as well as its physical contents and assets, from the damage costs that come from floodwater.
Whether your business is located in an area of common flooding or not, commercial flood insurance is worth exploring. Contact us to go over your risk of flooding, the needs of your business, and your coverage options.
Commercial Flood Insurance FAQ
What does commercial flood insurance actually cover?
Commercial flood insurance covers two separate things: your building and its contents, each with its own limit. Through the NFIP, coverage caps at $500,000 for the building and $500,000 for your business’s contents, such as furniture, equipment, and inventory. Payouts are typically based on actual cash value, meaning depreciation is factored in, rather than the full cost to replace what was lost. Your agent can walk you through how these limits and valuation rules apply to your specific policy.
Is my business required to carry flood insurance?
In most cases, no. But if your business has a mortgage and the building sits in a high-risk flood zone in a community that participates in the NFIP, federal law generally requires your lender to make sure it’s covered. Outside a high-risk zone, coverage typically isn’t required, though that doesn’t mean the risk is zero. Check with your lender and agent to confirm whether coverage is required for your building.
What happens when you file a commercial flood insurance claim?
Filing a commercial flood claim starts with documenting the damage and contacting your insurer, which will send an adjuster to inspect the property and assess the loss. Depending on your policy, the payout may be based on actual cash value, which accounts for depreciation, so it’s worth understanding how your coverage is valued before a loss happens. Keeping records of your building and contents in advance can help the process move faster.
What determines the cost of commercial flood insurance?
Commercial flood insurance premiums are shaped by factors like your property’s flood zone, elevation, construction type, and the coverage limits and deductible you choose. Because pricing can range widely, from a few hundred dollars to several thousand a year, it’s worth getting a specific quote rather than estimating from a general range. Your agent can explain what’s driving your premium and what type of savings may be available to you.
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Commercial Flood Insurance Quote Request
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