How Important is Insurance in Commercial Real Estate Property Investment?
Insurance In Commercial Real Estate Property
Insurance is a term use to protect different assets, tangible or non tangible things in the modern world. People in different parts of the world like to insure their expensive things, i.e. laptops, mobile phones, human life, home insurance and car insurance etc.The aim to insured things to overcome financial losers in real life. In first world the concept of insurance is very popular and people like to complete the process of insurance while in developing and underdeveloped countries the concept of insurance is new. Adrian Flux, State Farm,Commercial Combined Insurance, State Farm, Berkshire Hathaway, Liberty Mutual, Allstate Nationwide, Zurich etc. known as the top insurance companies in the united states and different parts of the world.What is Insurance in Real Estate?
Insurance in real estate is a system to protect assets like lands, shops, apartments and shopping malls. The world is unpredictable and environment is changing and human can only inform. while human are unable to protect equipments. Insurance is a term used to protect assets. The are different organizations which run real estate insurance. they have monthly and annual fees and when something happens in properrties these companies overcome the losses of individuals.
Why Commercial Insurance in Real Estate is Important?
Commercial real estate is always expensive in term of investments. People invest capital to get high returns in term of rents. Investment is the result of individual savings of the life. In world we can predicts natural disasters and can not protect completely human lives, structure and buildings. However, In real estate building can protects from natural disasters like in Japan or Indonesia consider the home of earthquakes there real estate building protects and build within the protection system. In Japan building are safe and flexible in earthquakes. Still tsunami and fire incidents can damage building. In commercial real estate such damages effects owners and tanents both.
Insurance in developing commercial real estate
Developing commercial real estate includes properties in structure and raw forms. Developing real estate is in the beginning process and loss of properties is lower than developed properties. Developing real estate includes land and building structure. land and gray structure can be damaged with low construction material and can be damaged with low quality work.It is very important for investors and general clients in insured land or building if they are buying after completion or going to construct themselves. In this type of real estate, insurance rates is low and give complete benefits. If land is not solid it takes high expensive, whereas, after following all procedures sometimes building can damage for many reasons such as storms, Floods, earthquakes etc. It's important to complete insurance process to protect the investment.
Insurance in Developed Commercial Real Estate
The developed commercial real estate includes commercial properties, i.e. shops, flats, studios, apartments, shopping malls and plazas. Developed commercial real estate is 10% expensive for developing real estate. Developed real estate takes time to complete the construction process. It is more important than developing real estate because of time and investment of individuals. Insurance is every essential for developed real estate to protect an individual asset.What are commercial real estate, insurance rates?
In different parts of the world insurance rates are different from country to country, and complete with local currencies. In united kingdom home insurance starts from 100£ per year to 2000£ per years depend on the locations and value of the building and properties. In the united states it starts from 500$ to 1000$ per year.Who are Commercial Real Estate Insurance Providers?
There are different insurance public and private companies provide different services of insurance in different parts of the world. Insurance companies works nationally and internationally i.e. The Hartford, Insure on, Insurance321, Nationwide and Allstate etc.6 factors that affect the cost of business property insurance include:
GeographySafety and Security
Size of Business Premises
Age of Building
Type of Equipment
Age of Equipment
Source https://www.investopedia.com/terms/c/commercial-property-insurance.asp
Top 25 Insurnace comapnies provide Services
The are top 25 companies which provide insurance services globally1. State Farm
2. Berkshire Hathaway
3. Liberty Mutual
4. Allstate
5. Progressive
6. Travelers
7. Chubb
8. USAA
9. Farmers
10. Nationwide
11. AIG
12. Zurich
13. Hartford
14. CNA
15. AmTrust Group
16. American Family
17. Auto Owners Group
18. Erie Insurance
19. Tokio Marine
20. American Financial
21. W.R. Berkley
22. Assurant
23. Fairfax Financial Holdings
24. Cincinnati Financial
25. Markel Corporation
Source : https://www.insurancebusinessmag.com/us/news/breaking-news/these-are-the-top-25-propertycasualty-insurance-companies-in-the-us-32630.aspx
