Property Insurance Basics

Property insurance covers a business's building and its contents -- money and securities, accounts-receivable records, inventory, furniture, machinery, supplies and even intangible assets such as trademarks

Some insurance companies offer property insurance by named peril, such as fire and theft. Others offer policies that cover multiple perils. Most basic multiple-peril policies include losses caused by fire and theft, but business owners can purchase additional types of coverage if they need it. For example, a business in the Midwest or on the East Coast may want to purchase coverage for snow, ice or sleet damage, while businesses on the West Coast may consider an earthquake-insurance policy.

Businesses with good loss-control measures and claim histories often pay lower insurance premiums than companies with risky procedures and poor claims histories. Taking steps to prevent loss — hiring security personnel to prevent shoplifting, installing a sprinkler system to contain fires or using an alarm system to protect against theft — can help control the cost of property insurance.