The way you are covered for property insurance varies from policy to policy in two main ways:

In terms of property, some policies cover basic equipment (building structure, furniture, inventory, equipment, and supplies); others insure money and securities, such as lost revenue or cash on the premises, and hard-to-replace records, such as accounts receivable, from damage or loss.

Events that do damage are known as perils or causes of loss, and include weather-related events such as lightning strikes or hail, or human causes such as robbery or vehicular accidents.

There are two types of policies available to cover perils: a named-perils policy, which covers losses resulting from only those perils the policy names, and an all-risk policy (a.k.a. special form coverage), which offers coverage for all perils except those specifically named.

Most companies are better off with all-risk policies (which typically have higher premiums), and usually can pick and choose coverage for additional perils if necessary.

For businesses that don't qualify for a Business Owner's Policy (BOP), which lumps property insurance together with liability insurance, it's a good idea to purchase property insurance a la carte to make sure your business is protected.

Click here to learn about whether you qualify for a BOP.