8 Reasons Why You Need Commercial Strata Insurance
financial wreck when disaster hits. Commercial strata insurance protects your premises from the financial effects of natural disasters, including floods, earthquakes, tornadoes, or wildfires. In the absence of this cover, fixing or rebuilding your property may result in overwhelming expenses that could bring you bankruptcy in the worst-case scenario.
1. Safeguarding Common Areas
Common areas like lobbies, elevators, stairways, and parking lots of commercial strata properties are shared among several unit owners. Whose is to blame if these areas are damaged or someone gets hurt? Commercial strata insurance relieves owners of the entire financial burden by providing liability coverage and property damage to these shared locations.
2. Legal Protection
Legal matters can crop up when least expected, such as a slip-and-fall on one’s premises or a quarrel between the owners over property maintenance. Business strata insurance offers a legal defence by including legal costs and settlements as part of the coverage, thus guarding against expensive litigation for your company.
3. Replacement Cost Coverage
Commercial strata insurance usually provides replacement cost coverage, which means that your property will be completely restored to its original state without any deductions due to depreciation. Through this remarkable coverage, you won’t need to use your cash to make up the difference between the replacement cost and the current value of the structure you protect.
4. Protection for Building Contents
Your commercial facility is likely home to all those important things you own, such as office equipment, inventory, and furnishings. Commercial strata insurance, in addition to the structure itself, protects the contents. Whether it is a broken pipe or theft, insurance will help you have peace of mind that your business will be recovered quickly without incurring heavy financial losses.
5. Loss of Rental Income Coverage
Say your workplace goes into exceptional circumstances caused by a covered hazard, and your tenants do not pay rent; what will you do? An advantage of commercial strata insurance is that it makes up for the rental income one would have been getting while the property is being repaired and the tenants move in. This necessary coverage guarantees that you will have no financial difficulties while the house is being repaired.
6. Risk Management for Owners Corporations
Owners and corporations are responsible for maintaining common areas and shared facilities within commercial strata properties. By offering cover to owner corporations, commercial strata insurance enables them to reduce the financial risks of property ownership. Multiple owners can join together and incur the insurance premiums, thereby guarding their common interests, and they can maintain the property’s sustainability.
7. Compliance with Lender Requirements
If you have managed to get financing to purchase or refinance your commercial property, your lender may ask for commercial strata insurance as one of the conditions. Lacking essential insurance coverage may jeopardize your finances and cause the deals to fall. As a result, your investment application may fail. By undertaking commercial strata insurance, you will meet the lender’s requirements, reduce your exposure, and safeguard your returns on investment.
Commercial strata insurance is an integral part of risk insurance for any commercial property owner. Disasters do not happen overnight—get a commercial strata insurance policy today and be assured that your investments are safe for tomorrow.
