The Insights into the Impact of Security on Commercial Property Insurance Rate

Mar 08, 2023


commercial property insurance rate

A commercial property insurance policy is crucial for business owners, as any loss/damage to your building or assets can interrupt your business operations while causing financial liabilities. You have to pay for the losses out of pocket without property insurance. However, some business owners still refuse to buy the coverage because of its cost. The commercial property insurance rate varies depending on several factors, from the location of the building to property worth. However, improving the security of your property can help lower your insurance premiums. Do you know how? Read on to find out.

Factors That Impact the Commercial Property Insurance Rate

The cost of the commercial property insurance is calculated according to:

  • The size and condition (age will be considered) of the property
  • The location of the property (weather and susceptibility to natural calamities will be considered)
  • The nature and cost of the assets stored on-site

Besides, the safety of your property and your surroundings will be considered. While evaluating the safety and security risks of your commercial property, insurers will look into the crime rates of your community and the presence of dangerous materials on-site. Also, they will consider the nature of your work to determine whether it could pose any risks that could turn into liability claims and lawsuits. For example, if you are running a hotel or bar, you are prone to liability claims from unruly or over-served patrons.

What About Hiring Security Guards?

When it comes to increasing the security of their business property, most business owners think of hiring armed security guards. However, armed security guards will introduce firearms, increasing the risks and probability of an insurance claim. This makes it difficult for business owners to qualify for coverage or lower premiums.

Automate the Security of Your Property to Reduce Premiums

Automated security systems, such as motion sensors, burglar alarms, CCTV cameras, fire alarms, and smoke detectors, will help monitor your property 24/7, protecting it and preventing intruders from entering it, thus minimizing the risk of theft, fire incidents, and vandalism. Moreover, even if a crime occurs on your property, you can easily identify and trace the thief with the footage from your surveillance camera. You can recover the stolen goods this way rather than filing a claim with your insurer.

The Importance of Remote Guarding

You can have someone or a team monitor your property, to make the most of your automated security system. Say, for example, you can have one or two people sitting in the CCTV camera room to see who is entering and exiting your property and quickly react if they spot any unknown. Or you can have them receive alerts when your sensors or cameras spot suspicious activities.

You cannot control or prevent weather-related damages, but you can make every possible effort to increase the security of your property. Installing safety features can minimize the risk of potential mishaps, thus helping you to qualify for lower premiums or related discounts.

Cover Your Commercial Property Against Risks with Knight Insurance

At Knight Insurance Services, we are committed to helping business owners across California and the surrounding communities with all their property insurance needs for over 100 years. Contact us today to get started on your personalized commercial property insurance.