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Understand Your Property Insurance Options

By Heather Brown
July 08, 2016

Small adult residential care homes or facilities are often found in residential houses. Many adult care home owners have the belief that a homeowner’s insurance policy is adequate coverage.  This assumption is not accurate. Many owners do not realize this until they try to file a property insurance claim and it is denied! Why?  Homeowner’s insurance policies exclude properties that run a business out of the home.  Adult residential care home owners should instead look to purchasing a commercial insurance policy for their dwelling.

Why?

Commercial property insurance is a great solution to protect your adult residential care home. It protects your business for covered damages due to fire, lightening, theft and various other causes. Commercial property insurance pays the costs of rebuilding or updating your building when damage occurs.

Benefits

Unlike homeowner’s insurance policies, commercial property insurance offers two additional benefits to help protect your business when damage occurs:

  1. Business property (contents of your home). A commercial insurance policy gives you the option to protect the contents inside your home used for business purposes. Examples include appliances, furniture, medical supplies owned by the business and other items you utilize to keep your business running smoothly.  Since homeowner’s insurance policies exclude business operations, these types of content are not able to replaced under its coverage.
  2. Loss of business income. How will you run your business if damage occurs to your adult residential care home, causing it to be uninhabitable?  Loss of business income is an insurance coverage only offered on commercial property policies. It protects you during this type of occurrence by paying the business income you would earn if damage had not occurred to your building.  This payment during rebuilding or repairing of your adult residential care home allows you to still earn an income and pay bills in a timely fashion.
  3. Extra Expense.  Extra expense can be purchased with the loss of business income coverage.  Do you have valuable employees?  Extra expense coverage is purchased by adult residential care home owners to cover payroll expenses of employees.  You risk losing valuable members of your staff if your home is damaged by a fire and you have to close for a few weeks or month. Extra expense insurance pays you payroll costs during times like this, allowing you to continue paying employees.

Additional Coverage

Commercial property insurance provides you with several options to protect your adult residential care home.  It is designed to help protect the business’s property though.  There are two additional types of insurance you should consider to make sure you are fully protected:

  1. Personal Property Insurance. Often times, adult residential care home owners live with the residents.  If you are one of these owners, make sure you purchase additional property insurance for your personal belongings like clothes, jewelry and other items not needed to run your business.  Just like homeowners insurance policies exclude business operations, commercial policies exclude personal items.

 

  1. Resident Property Insurance. Property owned by your residents is not covered under a commercial property insurance policy.  Residents can protect their personal belongings by purchasing a personal property insurance policy.

Fire, theft and other types of damage cause a great deal of stress on adult residential care home owners.  Researching property insurance options available can leave you feeling confused and unsure.  Contact your insurance agent to help you through the process and make the best decision available to your adult residential care home.

 

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