Homeowners Insurance Policies vs. Commercial Insurance Policies: What’s the Difference?

In simple terms, an insurance policy is a contract between the insured and the insurer whereby the insurer, in exchange for a premium, agrees to pay in case the insurer suffers a loss. When the insurer does not pay as required under the terms of the policy, a Miami property insurance lawyer from Ver Ploeg & Marino is here to help. 

There are many different types of insurance policies that can insure against a wide range of financial losses. Homeowners insurance policies and commercial insurance policies are two types that are similar in some ways but different in many others.     

Differences Between Homeowners Insurance Policies and Commercial Insurance Policies

Named Insureds

Every insurance policy has a person or entity that is named as the insured. On residential policies, the insured is typically the person or person(s) that own the home. For commercial policies, the issue is generally not so clear-cut. While the name of the business entity is typically named as the insured, other parties may be named in the policy. When this happens, confusion regarding who the actual insured party is arises, and the assistance of a Miami property insurance lawyer may be needed, especially when the confusion leads to a denial of coverage. At Ver Ploeg & Marino, our attorneys are experienced in representing policyholders when their claim has been wrongfully denied.  

Types of Risks

Most residential insurance policies are very similar to what they cover with some variations, such as hurricane coverage for homes that are in areas prone to hurricanes. On the other hand,  there are as many different types of businesses as there are stars in the sky, and the needs of each of those businesses are distinctive and unique. Because of this, the types of risks a business must face are different from those faced by other businesses, and their insurance policy should be tailored to fit their individual needs and the risks they are taking. These risks often depend on the type of industry the business operates in as well as its location and amount of technology usage. 

According to Business News Daily, there are four main categories of risk that a business should consider:

• Operational: Day-to-day operations should definitely be addressed by your commercial insurance policy. This includes customers, workers, and the product or service being offered, as well as tangible assets.
• Strategy: Every business should have a strategy for success. If this strategy is undermined by competitors, the business may fall behind in its industry. 
• Compliance: Businesses are required to understand and comply with regulations and rules established by their industry and the government. This includes tax obligations, zoning rules, and matters addressed by HIPAA.
• Reputational: It can take years to build a good reputation, but only minutes for it to be destroyed. Businesses face and should consider the risks presented by data privacy breaches and other security issues.

If you are confused regarding the type of coverage your business has or need assistance deciding the type of coverage to obtain, a Miami property insurance lawyer can help. 

Specialized Coverage

Residential insurance policies focus on the physical property, while commercial properties require more specialized coverage. Following are some examples of specialized coverage that businesses should consider:

• Employment Practices Liability Insurance (EPLI): This type of insurance is there to provide protection when an employee files a claim against the business for anyone of a variety of issues, including wrongful termination, discrimination, or sexual harassment. 
• Professional Liability Insurance: Often referred to as Errors & Omissions (E&O) insurance, this type of insurance serves to protect against claims that the services provided by the business caused a customer/client bodily injury or financial distress.
• Business Interruption Insurance: Business interruption insurance exists to help a business cover lost income when they are forced to shut down for a time due to a natural disaster such as a fire or flood. 
• Workers’ Compensation Insurance: Workers’ compensation insurance exists to provide employees with a portion of lost wages and medical costs for work-related injuries and illnesses. In exchange, the worker is not able to sue the company for their injury or illness. 
• Cyber Insurance: Cyber insurance provides protection from cyber-attacks and data breaches. 

It is important to ensure your business has the individualized coverage that it needs so there is compensation available when the unexpected occurs. And if the insurer denies your claim, speak with a Miami property insurance lawyer from Ver Ploeg & Marino.

The Insurers

Unlike residential policies, commercial property insurance policies are typically written by surplus line insurers. A surplus line insurer is not state-licensed and regulated by the state in which they are conducting business and generally not guaranteed by a governmental fund. They may or may not be regulated by the Department of Insurance (DOI). It is critical that a business knows exactly the type of coverage they are receiving with surplus line insurers and any risk they face by obtaining coverage through any certain insurer. Speaking with a Miami property insurance lawyer is advised to ensure no surprises. 

More Than One Location

Residential properties are generally for one physical property, a home. However, it is not uncommon for a business to have more than one location and they will require adequate insurance coverage for each location. For example, a business that sells clothing may have a warehouse that is separate from the store where people actually enter to shop. Each property will need to have its own insurance policy tailored to fit its needs and purposes. 

Speak With A Miami Property Insurance Lawyer From Ver Ploeg & Marino

If your insurance carrier has denied the claim you made under your policy, a Miami property insurance lawyer from our firm can help. With over two decades of experience assisting policyholders with resolving their disputes with their insurance providers, we have the experience you are looking for. We may be reached via our contact page. 

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