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Fire & Water - Cleanup & Restoration

Does Your Business Need Commercial Flood Insurance?

11/8/2021 (Permalink)

Flood insurance form on a table with a book. Most flood policies only cover damage to your business’s physical structures. Most do not, however, cover damage to exterior parts.

Is Commercial Flood Insurance Necessary for Your Company?

The point of owning a business is to make money while selling goods or providing services. As you likely know, a flood can stop your business enterprise in its tracks. To better protect your organization from the harmful effects of floodwaters, you may want to purchase flood insurance.

Are Floods Covered by Conventional Commercial Insurance?

Because you are a diligent business owner, you have probably purchased conventional commercial insurance. Generally, commercial policies cover the following situations:

  • Damage to business property
  • General liability
  • Workers compensation

Glaringly missing from this list, of course, is damage due to flooding.

What Does Flood Insurance Cover?

If you purchase insurance coverage to protect your business from floodwater damage, you can expect it to generally cover damage to the outside and inside of your business. This includes losses from storm surges, rising rivers, excessive rainfall and other similar causes. Note, however, that a floodwater policy usually does not cover water from above your business. If your damage is due to overflowing gutters or a leaky roof, your commercial property insurance will likely cover your business loss.

What Does a Flood Policy Not Cover?

Most flood policies only cover damage to your business’s physical structures. Most do not, however, cover damage to exterior parts. Specifically, a flood policy likely exempts the following:

  • Damage to landscaping
  • Damage to septic systems
  • Damage to vehicles
  • Damage caused by work stoppages

Are You Required To Purchase a Flood Policy?

Most business owners have no obligation to purchase a flood policy. If your business is in a floodplain, however, you may have a legal requirement to purchase flood coverage. This is specifically true if you have a federal-backed mortgage. Restoration service may be able to help you restore the condition of your company after a flood, you may need to purchase flood insurance to better protect your business.

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