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  • Business Contents Insurance Explained

    Business Contents Insurance

    Business contents insurance is essential part of business insurance cover to reimburse you for the cost of replacing your business’s contents, stock or electronic equipment in the unfortunate event that it may be damaged or stolen. The insurance can cover a range of items from as small as mobile phones and laptops, to office furniture, raw materials and large machinery. Should your business suffer a theft or attempted theft or is damaged in an unexpected event, then your contents insurance will help to safeguard your ability to continue trading.

    Whether you run an office, retail outlet, pub, restaurant, hotel or factory, the value of your business contents is likely to be substantial, with a great deal of your assets being tied up in your premises. If these assets aren’t insured correctly, this could affect the day to day running and the immediate revenue of your business.

    Business contents insurance coverage will differ from one provider to another, and they may offer specialist insurance for different industries, such as the retail industry, offices and surgeries, and home businesses. As well as your tangible assets, don’t forget that you are also able to insure for intangible assets such as patents, copyrights, and valuable business data on paper or computers, etc.

    Cyber liability is another insurance coverage becoming more relevant and important than ever, this can provide indemnity in the event of a data breach or similar incident – This coverage can be vital for any business holding sensitive data, no matter how big or small.

    How to value your stock and equipment

    When taking out business contents insurance, you should always ensure it is insured for a replacement value rather than its initial purchase price. There may be certain times in the year when you know you will be holding more stock than normal, perhaps at Christmas. It is therefore important that your business contents insurance will cover this busier period too.

    You may wish to insure specific high-value items separately but either way you need to make sure you don’t under-insure your business as this can leave you out of pocket. Be aware of any specialist equipment or machinery that may have significantly gone up in value since your original purchase and your need to replace like-for-like. With up to 80% of UK businesses being underinsured and 40% unable to re-open following disaster because of underinsurance this is a big issue.

    Types of business contents insurance

    There are two types of cover that you can insure your stock and equipment against:

    Replacement as new policies will replace an item with a new one. Bluedrop Services offer the majority of their quotes on this reinstatement basis.

    Indemnity policies or actual cash value will just pay for the cost of replacing the item at its current market value, taking into account depreciation and wear and tear.

    It is important to carefully consider which form of cover is acceptable or required for your business and if you do simply require an agreed value basis then this can be discussed at the quote level.

    Insuring your business equipment anywhere in the world

    An ‘All Risks’ policy will provide cover for your portable equipment away from the office so it is not limited to your premises only. All risks cover can also be provided for specified items rather than all of your business contents, such as laptops, if you know they will be taken off the premises on a regular basis.

    Is business contents insurance a substitute for business interruption insurance?

    No. If any of your equipment or stock is damaged or destroyed then you will need to factor in the cost of replacing the items as well as any business income that you will lose as a result of the loss. Business Interruption cover is a separate form of insurance and accounts for any reduction in income or increase in cost of running in the event of damage and whilst waiting for repairs, replacements or re-builds of property. A combined retail/office/leisure package can incorporate the business interruption cover with business contents, to form a comprehensive business package.

    Click here for more information on Bluedrop’s commercial insurance or to get an online quote, or call the office on 01489 222 311

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