Buildings insurance for your business premises

What is a building for insurance purposes?

Included are all the parts of a building for which demolition or dismantling work is required to break down the building. For example, windows, ceilings, doors, and walls. Fences and hedges also belong to the building.

When is commercial buildings insurance useful?

Buildings insurance (opstalverzekering in Dutch) is useful if you are the owner of your commercial property. It is not mandatory to take out buildings insurance. But the costs for repairing damage can be very expensive without insurance.

Do you rent your workspace, office or other business premises? If so, the owner of the property will arrange the building insurance.

Building insurance sometimes mandatory for a mortgage

Are you applying for a mortgage on your commercial premises? Your premises serve as security for the mortgage. The bank or mortgage lender may require you to take out building insurance.

What is usually covered by buildings insurance?

• Damage to your business premises
• Damage to a shed, stable, or garage, if used for your business activities

What is covered and what is not depends on your insurance company. And the conditions of your insurance policy. So always check which parts of your premises are covered by your buildings insurance. Read the policy terms and conditions carefully or ask your insurer for advice.

In some cases, you can also take out cover for the costs of a temporary workspace elsewhere if damage prevents you from working at all or from in your business premises.

Cost of commercial buildings insurance

The cost of buildings insurance for commercial premises varies and depends on factors such as:

• the type of premises
• the location
• the cost of rebuilding the premises

The cost of commercial buildings insurance is a business expense and can be deducted from your profits for income tax purposes.

When does buildings insurance pay out?

You policy states when your insurer will pay out. Common reasomns include:

• fire
• water damage
• storm damage
• vandalism
• theft

In most cases the insurer will visit you to assess the damage and the cause. They will also check what measures you had taken to prevent or minimise damage. The insurer may offer to have the damage repaired, or they may pay an amount so you can do it yourself. This depends on the terms and conditions in your policy.

What is usually not insured?

The following damage is usually not covered by buildings insurance:

• Indirect damage such as loss of income. For this you need business interruption insurance
• damage to your inventory. For this you need inventory insurance
• damage to goods or stock. For this you need goods insurance
• damage that you cause deliberately yourself
• damage caused by poor maintenance
• damage caused by illegal activities, for example a cannabis plantation
• damage caused by natural disasters, such as earthquakes and floods

Insuring a home office

Do you have an office or other workspace at home? If you own your home, you will often have taken out a private home contents insurance policy. The home contents insurance you have taken out privately does not usually cover damage to your workspace. If you want your workspace to be insured, discuss this with your insurer.

This also applies to any home contents insurance you may have taken out privately. This does not cover damage to business assets. Do you want it to? Ask your insurer about the options.