No matter what kind of business facility you have, or where it is located, you will need insurance coverage to protect your business from property damage and liability risks.

You will need insurance to protect your business against personal injury and other liability claims arising from your use of the facility. You'll also need coverage to reimburse the business for any property damage to the building and its contents caused by fire, wind, lightning damage, and the like, as well as damage caused by the acts of people, such as theft, vandalism, and negligent damage to your business property.

The choices you make in connection with your business facility will influence the cost of your business insurance coverage.

When you first went into business, you chose the type of business you would operate. Both as a general category (such as retail, wholesale, or manufacturing businesses) and as a specific type of business (such as a bookseller open nine to five on weekdays only, or a 24-hour convenience store), this decision affects your business insurance rates. Additionally, the crime and fire loss experience of the community and area where you locate may have a large effect on these rates. In some areas, business insurance may not be available at all because of a high crime rate or a very high likelihood of hurricanes, floods etc.

The portion of your business insurance rates that are determined with reference to the choice of business and business location are largely out of your control — the insurance company figures the likelihood of claims and amounts to be paid out for each category that applies to your business (such as kind and location of business) and computes your rates accordingly.

There are business choices, however, that can give you much more direct control over your facility-related insurance rates. The condition, security, and fire protection features of your building are examples of this. A modern, well-lighted building with good access to police and fire departments and good security and fire protection features will make a difference in your premium rates. How safe and claim-free your business has been in the past will also affect your rates.