Insurance for Legal Entities' Property: what and how can you insure

What can be insured?

Property insurance provides the opportunity to insure various objects and assets belonging to legal entities. These include buildings, offices, factories, warehouses, production and office equipment, vehicles, inventory, goods, raw materials in warehouses and other assets that have a financial value for the company. Additionally, it is possible to insure losses resulting from interruptions in the company's production caused by property damage during an insured event (such as loss of profit, missed rental payments, etc.). Another type of insurance is liability insurance towards third parties: insurance against losses that a company may incur in the event of claims or lawsuits from third parties. This entire range of insurance options allows companies to protect their assets from various unforeseen events.

What risks can property be insured against?

Property insurance can be carried out under the "All risks" coverage, which includes protection against damage and loss of property resulting from any sudden and unforeseen events that are not explicitly excluded according to the insurance company's rules. It is also possible to arrange insurance policy for named perils, such as:

• Fire, explosion, lightning 
• Water damage
• Various damages, including falling trees and vehicle collisions
• All types of malicious acts
• Natural disasters like hurricanes, floods, earthquakes, and more
• Falling aircraft and their parts
• External influences
• Glass breakage
• Terrorism and sabotage

Risk assessment mechanisms

Insurance companies assess the level of risk for each type of property based on various factors, including its value, location, age, condition, the presence of fire protection and security systems, loss history and other parameters. Based on this assessment, the insurance premium is calculated, that is, the amount the company must pay for insurance.

How is the insurance value of property determined for legal entities?

The insurance value is determined by mutual agreement, but not exceeding the actual value of the property. For buildings and structures, this can be the current market price of the object or its replacement cost (the cost of constructing a similar object, taking into account depreciation and technical condition). When insuring at market value, the insurance company typically requests a property appraisal report. For engineering and production technology equipment, the actual value is the amount needed to purchase equipment identical to the insured one, minus depreciation. Specific features of each object and the company's needs are also taken into account. Assessing the insurance value requires careful analysis and may include replacement cost, year of construction, depreciation and other factors.
Document package for property insurance for legal entities
To obtain an insurance policy for legal entities, a specific set of documents is required. This package may include property ownership documents, floor plans and layouts, documents confirming the value of the property, appraisal reports and the completion of a technical characteristics questionnaire. All of this helps the insurance company assess risks correctly. At the conclusion of the contract, the insurance company may inspect the property in-house or request photos of it from the client.

Procedure for the occurrence of an insured event and indemnity for property insurance

Upon occurrence of an insured event or from the moment the client learns about the insured event, the client must contact the insurance company within the period specified in the contract or insurance regulations (usually 3-5 days). The client must also take all possible measures to save the property and prevent further damage and report the occurrence of the insured event to the relevant competent authorities. In order to receive payment, the client must submit an application to the insurance company and provide the necessary documents (usually the insurance contract, documents confirming the property interest, documents confirming the value of the property and the amount of damage caused, as well as documents of the competent authorities confirming the fact and circumstances of the insured event). In addition, the insurance company inspects the damaged property or requests photographs from the client. Typically, within 30 days after receiving all the documents, the insurance company makes a decision to pay the indemnity and draws up an insurance report. Then, within 10-15 working days from the date of signing the insurance act, the insurance company makes the payment.

When there will be no payout in insurance?

Payments may be denied if the loss is caused by actions committed with the intent of the Insured, established in the manner prescribed by criminal law. It is also possible to deny payment if the information provided by the client during the insurance was knowingly unreliable, as well as concealment of information about previous losses or deception of the insurance company.

Conclusion

Property insurance is an important tool for ensuring the financial protection of businesses from unforeseen risks and losses. It allows companies to minimize potential financial losses and maintain stability in their operations. The right choice of insurance program, based on a risk and company needs analysis, helps provide effective property protection and peace of mind to business owners and managers. However, before purchasing an insurance policy, it is essential to carefully review the insurance terms to ensure that all critical risks and assets are covered by the policy.r>