How Does Insurance Cover Your Business Off-Premises?
Most businesses must purchase both property and liability insurance. Lenders that have financed the purchase of buildings, equipment, furniture, merchandise and other types of property will require property insurance. In addition, many contractors and service providers find that potential customers will not do business with them if they do not have liability insurance.
Both, therefore, are essential parts of a business's financial protection, and they both protect a business for accidents that happen on the business premises. They start to differ, however, when business owners, employees and property venture off-premises.
Most standard property insurance policies cover property while it is on or within a specific number of feet of the premises, such as 100 or 1,000. That office laptop is covered while the salesman carries it to the parking lot and drops it on the back seat of his car, but not once he leaves the parking lot. Some policies may provide a small amount of coverage for personal property while in transit (in an employee's car or a company-owned truck.) However, depending on the value of the property being moved, the amount of insurance may not be enough to fully cover a loss. Depending on the policy, the amount of insurance might be $2,500 or $5,000, though some might provide more. Check with an insurance agent on the differences in off-premises coverage.
A different type of insurance, called "inland marine" insurance, covers personal property that moves off-premises. Businesses that own portable computers and tablets; contractors with expensive construction equipment; and businesses that ship inventory are examples of those that need this type of coverage. Insurers offer policies that cover multiple items under one blanket amount of insurance. When individual items have high values (such as construction machinery or valuable works of art,) the policy normally will include a list of those items and their values.
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