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Homeowners vs. Commercial Property Insurance: Which Does Your Adult Residential Care Home Need?

May 5, 2017

As an adult residential care home owner, you face plenty of daily challenges. Providing quality care for residents, maintaining state compliance, and properly training your team are just a few of the activities that keep you busy. By talking and working with other providers like you, we’ve learned that insurance, while important, isn’t always at the forefront of your mind. Finding the right insurance can be a tedious task, but we’re here to help simplify it.

One of the most commonly asked questions we hear is about property insurance. Some insureds come to us thinking, since they live in the home,  their homeowner’s insurance policy is enough to protect them in the event of a fire, theft, or other damage to their property.. Others think that since their last agent knew they had a business and never mentioned a commercial property policy, they don’t need one now.

The truth

The truth is the majority of homeowner’s insurance policies won’t protect you against catastrophic claims. To help you understand the differences between homeowners and commercial property insurance, we’ve put together a list of the top four questions we answer.

What does homeowner’s insurance cover?

Homeowner’s insurance pays to fix damages caused by fire, wind, hail, vandalism, or theft. Some policies include additional types of damage, but most don’t include flood or earthquake coverage.

Why do I need a commercial property policy?

Homeowner’s policies specifically exclude property used for business. That is why adult residential care homes need to purchase a commercial property policy to protect their bank accounts against potential losses.

Insurance companies send a claims adjuster to review the damage to your home in the event of a claim. If you run a business out of your home and the company didn’t know about it, but the claims adjuster discovers it, the insurance company will deny coverage.

What types of protection do I need to look for?

A primary coverage that pays for damages to your building and contents resulting from fire, hail, vandalism, etc. You can also buy loss of business income coverage to help pay the bills at the time of a crisis.

Loss of business income pays any lost revenue to your adult residential care home if you have to close due to the damage. For example, if you close for 30 days while the home is repaired, the insurance company will pay you thirty days of income (depending on the waiting period defined in your policy).

Where can I find property insurance for my adult residential care home?

As an agency that exclusively helps adult residential care homes like yours, PCALIC, LLC recently launched a unique property program. This program is based on the exact needs of adult residential care homes and makes sure you and your business are protected from financial ruin after damage to your property and home.

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