Commercial property insurance cost

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Starting and running your own business requires a level of sweat equity that few non-entrepreneurs can appreciate. But without the right insurance coverage, owning a small business can involve just as many tears if you experience property loss. Whether you’re a butcher, a baker, or a candlestick maker, make sure you factor in commercial property insurance costs to cover the unforeseeable risks your small business faces.

Commercial property insurance is essential for most small business owners because it covers the physical property owned by the business, including the building itself as well as contents in the building that you need to run your business. You may be wondering how much commercial property insurance costs to get that level of protection for your business. Let’s tally.

How much does commercial property insurance cost?

Many variables determine commercial property insurance costs — and we’ll cover them for you below — but one of the most cost-effective ways for small businesses to purchase commercial property insurance is through a Business Owners’ Policy (BOP).

In addition to commercial property insurance, BOP is a bundled insurance package that also includes general liability insurance, which covers the financial consequences of third-party claims of bodily injury, property damage or advertising injuries, like copyright infringement.

This double-whammy coverage is designed to help small businesses protect themselves against common risks. Not only is it more convenient, but it also tends to be more cost-effective to purchase these coverages in a bundle rather than buying each separately.

On average, a BOP through Thimble costs $69 per month or $828 annually (including commercial property insurance). That’s a pretty good deal for some long-term peace of mind!

What factors influence commercial property insurance cost?

Commercial property insurance premiums vary based on multiple factors. Some factors are:

Business location

Your zip code is a factor that will influence your commercial property insurance cost. Densely populated areas tend to have higher risk levels because incidents of theft or vandalism tend to be more common. If you own a grocery store in a busy urban area, you may have a higher premium than if you were located in a quiet suburb.

Crew size

The size of your crew factors into costs because, generally, the more humans you have working for you, the greater the chances of human error. “To err is human,” after all.

Coverage limits

Generally, the more coverage you buy, the higher your commercial property insurance will cost. That doesn’t mean that if you increase your coverage from a $250K policy to a $500K policy your costs will double as well, but you can expect a premium increase.

Property value

The higher your property value, the higher your limit, and therefore, the higher your commercial property insurance premium cost. This applies to the value of your building (if you own it) as well as to the value of your business contents. All things being equal, a jewelry business is likely to pay a higher cost than a pet business, due to having valuable stock that is attractive to thieves. If your business relies on specialty equipment to operate, then the cost to insure that equipment will be higher because the expense to repair or replace it is greater.

Fire risk

Fire is a common hazard for most businesses, and it factors into your commercial property insurance cost. Variables such as your building’s proximity to a fire station and the materials out of which your building is constructed will influence premiums. Steps taken to reduce the risk of fires, like installing a sprinkler system, can reduce costs.

Other tenants in your building

The number and type of other tenants in your building can also impact your premium costs. More tenants generally mean more risk. For example, if your neighbor is a glassblower and uses an extremely hot oven for her creations, that increased fire hazard will be a factor that influences your premium cost.

What does commercial property insurance cover?

Commercial property insurance includes multiple types of coverage:

  • Business building insurance covers the physical structure where a business operates if it is owned by the business, be it a barn on a dairy farm, a garage for an auto repair shop, or a laundromat.
  • Business content insurance covers the business property contained inside the building, or within 100 feet of the premises, including milk cans and hay bales, torque wrenches and air compressors, or washers and dryers.
  • Business interruption insurance covers the loss of business income resulting from physical damages or losses to a business that forces you to temporarily shut down until the cows can start mooing again, the engines start purring, and the towels and sheets can resume their perpetual spin cycle.

Protect your property with Thimble

Most small businesses today need commercial property insurance to guard against the myriad risks that could threaten their livelihood. Whether you’re running a snow plowing business or an antique store, this coverage includes business building insurance to help cover the costs of repairing or replacing your business’s four walls in the event of damages or loss. Even if you don’t own your own building, commercial property insurance includes coverage for your business contents that you rely on to operate.

Plus, taking advantage of a BOP through Thimble saves you both time and money. When you bundle commercial property insurance with general liability insurance, you can get more comprehensive coverage at an average cost of only $69 per month.

Get to work before the other guys even call you back. Click “Get a Quote” or download the mobile app, answer a quick set of questions, and get covered within minutes.

Commercial property insurance FAQs

Can you get general liability insurance without commercial property insurance?

Yes, but your property won’t be covered. Furthermore, you can’t get commercial property insurance without general liability coverage through Thimble. In most cases, your best bet is a BOP policy, which provides both coverages at a more attractive price.

I don’t own my building. Can I still get commercial property insurance via a BOP?

Absolutely. Commercial property insurance also covers the contents within your building or within 100 feet of your premises. And, if a covered risk causes you to shut down temporarily, commercial property insurance can cover your expenses and lost income until you’re back up and running.

What does commercial property insurance cost per square foot?

The size of the space you occupy is certainly a factor in determining cost. As detailed above, several factors go into the average cost of commercial property insurance. Additional factors include location, limits, fire protection, and more.

What is the difference between replacement cost and actual cash value?

While setting up the commercial property portion of your BOP, you have the option of choosing replacement cost or actual cash value for your property valuation in the event of a loss.


Replacement cost equals the amount it will cost you to purchase or replace your property with similar kind and quality items. There is no deduction for the depreciation in the value of your damaged or lost item due to age or wear and tear.


Actual cash value pays you what the item was worth at the time of its loss. So, if you had an eight-year-old computer stolen, naturally it will be appraised less than the price of a brand new one.


Not surprisingly, replacement cost is the more expensive coverage option, because it pays a higher value for a lost item. The premium is less expensive for the actual cash value option, but the claim payment also tends to be less.

Are there coverage limits with commercial property insurance through a BOP?

Yes, the building coverage limits range between $250,000, $500,000 and $1 million, and the business property coverage limits are $50,000, $100,000 and $250,000.

Is there a choice of deductibles with commercial property insurance on a BOP?

Yes, the deductible options are $500, $1,000 or $2,500. And, as a general rule, electing a higher deductible can lower the cost of your premium and vice versa.

Can I add any other coverages to my BOP?

Yes, you can add equipment breakdown coverage and hired and non-owned auto insurance as endorsements to your BOP. Depending on your type of business, these coverages may offer you more comprehensive coverage.