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Different Types of Commercial Insurance
The   most common types of commercial insurance are property, liability and   workers' compensation. In general, property insurance covers damages to   your business property; liability insurance covers damages to third   parties; and workers' compensation insurance covers on-the-job injuries   to your employees. Depending on your business, you may want additional   specialized coverages. Listed below are some of the different types of   business insurance.

Property   insurance pays for losses and damages to real or personal property.  For  example, a property insurance policy would cover fire damage to  your  office space. You can purchase additional coverages for business   property, including:

Boiler and Machinery Insurance
Boiler   and machinery insurance, sometimes referred to as "equipment  breakdown"  or "mechanical breakdown coverage," provides coverage for  the  accidental breakdown of boilers, machinery, and equipment. This  type of  coverage usually will reimburse you for property damage and  business  interruption losses. For example, this coverage would cover  fire damage  to computers.

Debris Removal Insurance
Debris   removal insurance covers the cost of removing debris after a fire,   flood, windstorm, etc. For example, a fire burns your building to the   ground. Before you can start rebuilding, the remains of the old building   have to be removed. Your property insurance will cover the costs of   rebuilding, but not of removing the debris.

Builder's Risk Insurance
Builder's   risk insurance covers buildings while they are being constructed. For   example, a Builder's risk policy would cover losses if a windstorm  takes  down your partially constructed condominium complex.

Glass Insurance
Glass insurance covers broken store windows and plate glass windows.

Inland Marine Insurance
Inland   marine insurance covers property in transit and other people's  property  on your premises. For example, this insurance would cover  fire-damage  to customers' clothing from a fire at your dry cleaning  business.

Business Interruption Insurance
Business   interruption insurance covers lost income and expenses resulting from   property damage or loss. For example, if a fire forces you to close  your  doors for two months, this insurance would reimburse you for  salaries,  taxes, rents, and net profits that would have been earned  during the  two-month period.

Ordinance or Law Insurance
Ordinance   or law insurance covers the costs associated with having to demolish  and  rebuild to code when your building has been partially destroyed   (usually 50 percent). For example, your three-story building is 100   years old. A flood destroys the basement and first two stories. Because   more than 50 percent of your building has to be rebuilt, a local   ordinance requires that the building be completely demolished and   rebuilt according to current building codes. Property insurance covers   only the replacement value, not the upgrade.

Tenant's Insurance
Commercial   leases often require tenants to carry a certain amount of insurance. A   renter's commercial policy covers damages to improvements you make to   your rental space and damages to the building caused by the negligence   of your employees.

Crime Insurance
Crime insurance covers theft, burglary, and robbery of money, securities, stock, and fixtures from employees and outsiders.

Fidelity Bonds
A bond company covers losses due to a bonded employee's theft of business property and money.

Liability   insurance covers injuries that you cause to third parties. If someone   sues you for personal injuries or property damage, the cost of  defending  and resolving the suit would be covered by your liability  insurance  policy. A general liability policy will cover you for common  risks,  including customer injuries on your premises. More specialized  varieties  of liability insurance include:

Errors and Omissions Insurance
Errors   and omissions ("E & O") insurance covers inadvertent mistakes or   failures that cause injury to a third party. The act must actually be an   inadvertent error, and not merely poor judgment or intentional acts.   For example, an E & O policy would cover damages arising from an   insurance agent failing to file policy applications, or a notary   forgetting to fill out notarizations properly.

Malpractice Insurance
Malpractice   insurance, or professional liability insurance, pays for losses   resulting from injuries to third parties when a professional's conduct   falls below the profession's standard of care. For example, if a doctor   makes a mistake that other doctors of his specialty would not have  made,  his patient might sue him. A malpractice policy will pay his  defense  costs and any judgment or settlement. Malpractice insurance is  available  for doctors, dentists, accountants, real estate agents,  architects, and  other professionals.

Automobile Insurance
Commercial   automobile policies cover the cars, vans, trucks and trailers used in   your business. The coverage will reimburse you if your vehicles are   damaged or stolen or if the driver injures a person or property.

Directors' and Officers' Liability Insurance
This   type of insurance is generally purchased by corporations and nonprofit   organizations to cover the costs of lawsuits against directors and   officers.

Workers'   compensation insurance covers you for an employee's on-the-job  injuries.  Businesses with employees are required by various state laws  to carry  some type of workers' compensation insurance. In most cases,  workers'  compensation laws prohibit the employee from bringing a  negligence  lawsuit against an employer for work-related injuries.
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