Commercial Flood Insurance – What’s Covered in the Event of Flooding

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Commercial Flood Insurance – What’s Covered in the Event of Flooding

You’ve probably already gathered (well, at least I hope you have) that commercial flood insurance is extremely important to safeguard you against the risk of flooding for both the building and the contents within it. It only takes an inch or two of water to cause thousands of dollars worth of damage you know, and flooding happens in all 50 states so don’t presume that your business is safe. There are not many businesses which can operate profitably under the water . . . maybe a fish farm, but then again if your fish farm flooded all of your fish would be able to swim away and escape . . . not a good idea.

Commercial Flood Insurance – Is This Covered?

Anyway, the next thing we have to discuss is exactly what is covered by commercial flood insurance, and maybe more importantly, what isn’t.

Personal Contents Property Flood Insurance – What’s Covered

  • Any personal stuff inside the property – furniture, electronic equipment, machinery, clothes etc.
  • Air conditioners – the window type or other portable ones, not the ones which are part of the building, that comes later.
  • Drapes and Curtains, the price of these can’t half add up, and many of them are “dry clean only” so are liable to shrink if they get wet, that’s not to mention the muddy stains which are so difficult to remove, I don’t care what the washing powder commercials tell you . . .
  • Carpets which are not fitted and therefore are not covered by the buildings insurance (on the next bit).
  • Clothes washers and dryers.
  • Freezers including any food which is inside them . . . it doesn’t take long for stuff to defrost in water (that’s the best way to make sure that your frozen turkey is thawed in time for Thanksgiving – in a tub of water . . . wow, I bet you weren’t expecting foody tips on a flood insurance site were you? It’s all part of the service!)
  • Other valuables, although if you have anything really valuable like a painting by one of the Grand Masters or something like that, insure it separately because it won’t be covered.

Now then, obviously nobody keeps receipts for everything, well, nobody normal anyway, but if you do make sure that you have kept the receipts for the bigger and electrical type stuff it will really help to get your claim sorted out quicker in the case of a flood.

Building Commercial Flood Insurance – What’s Covered

  • The commercial property is covered, (of course), which fortunately includes the foundation . . . otherwise it might fall down!
  • Carpets which are fixed down permanently over unfinished floors (I told you we’d come to those in a minute)
  • Any permanent type “fixtures and fittings” – cupboards, panelling, cabinets, bookcases etc.
  • Built in appliances like stoves, refrigerators, dishwashers etc.
  • Water heater, furnaces and other equipment which is part of the fabric of the building. Oh, and any built in air condition appliances too . . .  I almost forgot about them.
  • Debris removal – not all floods are caused by a wave of pure, clean water, in fact, not many floods are caused by pure clean water. It’s more usual to have a muddy landslide of sludge carrying with it everything and anything which it has carried along with it – rocks, tree branches, bricks, bicycles, trash cans . . . It’s often a mammoth task to get everything cleared out before you can even think about repairing any of the damage.
  • Plumbing and electrical systems in the building (that one should have probably been nearer the top, anyway, never mind, I’ve remembered now).
  • Detached garages which make up less than 10% of your total business building. If you have any other buildings, maybe a store room or a boiler house or something like that, then you’ll need separate cover – put that on the list to ask your flood insurance agent, just to be on the safe side.

I think that’s just about covered everything that’s covered. If I’ve forgotten anything I’m sorry, check it with your insurance agent anyway, this is for information purposes only! Right, now let’s look at another bunch of stuff, the stuff which is  not covered . . . this might make interesting reading for you (well, I hope it does anyway).

  • Temporary accommodation for your business. Even if you can rescue some of your business and trade from another premises whilst yours is being dried out and repaired, the expenses associated with this will not be covered by your commercial flood insurance.
  • Financial losses because of interruptions to your business aren’t covered either. We know that businesses need to keep trading in order to make a profit, but if your trading is interrupted because of a flood then you aren’t covered for that. “Wot you doin?” . . . “Business” . . . “Wot business you in?” . . . “I’m in the business of doin’ business” . . . “Cool”.
  • Any stuff which is outside the building will not be covered by your flood insurance policy. This includes the trees and planting around your business which makes it look nice, as well as other stuff like septic tanks, and maybe even stock which was waiting to be turned into something special or is waiting to be collected by the man from Fedex.
  • Cars and other vehicles which are located on the premises aren’t generally covered by your commercial flood insurance either . . . so if your business is a car lot then you’d better make sure that you’ve got extra cover. Oh, and don’t forget things like the Forklift (remember the Fedex man?)
  • Any damage which could have been avoided but wasn’t isn’t covered either. This means things like mildew and mold which develop over a period of time after the flooding happened.
  • Currency, important documents and all that sort of stuff isn’t covered either . . . just to warn you!

If you notice on the Commercial Flood Insurance Policy Rates page that there’s a different in some prices available, that’s because lots does depend on where your contents are located in your commercial property.  Only limited flood insurance is available in:

  • basements
  • crawl spaces (either inside or out)
  • enclosed areas beneath the building

Can you guess why? Anyway, if much of your business is conducted below ground or in the basement then you need to point that out to your insurance agent and he’ll make sure that you’ve got it covered!


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