Business Insurance  /  Commercial Property

Commercial Coverage

Commercial Property Insurance
for Texas Businesses.

Your building, your equipment, your inventory, your contents — and in Texas, the weather doesn’t give you much warning before it tests all of them. We help businesses across the state build property programs that actually make them whole when something goes wrong.

What Is Commercial Property Insurance

The coverage that protects what your business is built on.

Commercial property insurance covers the physical assets of your business — the building you own or lease, the equipment inside it, your inventory, your furniture, your tools — against damage or loss from covered events like fire, theft, vandalism, hail, and wind. When something happens to your physical space or the things inside it, property insurance is what pays to repair, replace, or rebuild.

One of the most important distinctions in commercial property is the difference between building coverage and contents coverage. If you own your building, you need coverage for the structure. If you lease, your landlord’s policy covers the building — but everything inside that space that belongs to you is your exposure. Equipment, inventory, furniture, computers, tools — none of it is covered by your landlord. Business personal property coverage protects your investment in your own space.

“You don’t have to own the building to have a serious property exposure. Everything inside it — and everything that makes your business run — is worth protecting.”

What commercial property typically covers:

  • Building / structure — the physical building and attached fixtures, if you own the property
  • Business personal property — equipment, furniture, inventory, tools, computers, and contents inside your space
  • Fire, smoke & explosion damage — among the most common property losses for commercial businesses
  • Theft and vandalism — break-ins, stolen equipment, and damage from vandalism
  • Wind and hail — critical in Texas where severe weather is a regular threat
  • Business interruption — lost income and ongoing expenses when a covered loss forces you to close (typically added to a property program)

Flood Is Excluded — Know Your Risk

Standard commercial property policies in Texas exclude flood damage. If your business is in a flood-prone area — including significant parts of the Houston metro, DFW lowlands, and coastal regions — a separate flood policy is required. There’s typically a 30-day waiting period after purchase before coverage takes effect.

Texas Hail Is a Real Threat

Texas leads the country in hail claims. A single hailstorm can cause significant roof and structural damage quickly. Make sure your policy covers hail and that your limits reflect current replacement costs — not what you paid for the property or what it was worth when you signed the policy.

Replacement Cost vs. Actual Cash Value

Actual cash value pays what your property is worth today after depreciation. Replacement cost pays what it actually costs to repair or replace it. The difference on a claim can be significant. We always recommend replacement cost coverage for business property — the premium difference is usually modest, the protection difference is not.

Who Needs Commercial Property

Any business with a physical space, equipment, or inventory has property exposure.

Building Owners

If you own your commercial space, the structure itself is your biggest asset. Coverage should reflect current replacement cost — not market value or purchase price — and keep pace as your property improves.

Tenants & Leaseholders

Your landlord’s insurance covers the building. Everything inside that belongs to you — equipment, inventory, furniture, computers — is your responsibility and requires business personal property coverage.

Contractors & Trades

A shop, yard, or storage facility full of equipment represents significant value. Commercial property covers your location and stored equipment; inland marine picks up when it leaves for the job site.

Restaurants & Retail

Kitchen equipment, refrigeration, inventory, POS systems, and fixtures all need coverage. A fire or storm that damages a restaurant or retail space can result in losses that extend far beyond the physical damage.

Offices & Professional Services

Computers, servers, office furniture, client files, and specialized equipment all represent real value. Even an office that doesn’t seem high-risk has property exposure worth protecting.

Warehouses & Storage

If your business stores inventory, materials, or equipment at a warehouse or storage facility, commercial property covers what’s at that location — and can be structured to reflect the value of what’s stored there.

Real Risks. Real Scenarios.

What happens when property exposure isn’t properly covered.

These are the losses Texas business owners face — and the coverage gaps that make them harder to recover from.

01
A fire damages your space and you’re underinsured
A kitchen fire, an electrical failure, an arson — fire can cause significant damage quickly. If your property limits were set years ago and haven’t kept pace with the actual cost to repair or rebuild, the gap between what the policy pays and what the repair costs comes out of your pocket. Coverage should reflect current replacement cost, not outdated values.

03
A break-in cleans out your equipment and the limits are too low
A break-in at your shop or office takes equipment, tools, and electronics. If your business has grown and you’ve added equipment since the policy was written, the current limits may not cover what was actually taken. Business personal property limits need to reflect what you actually have — not what you had when you first bought the policy.

05
A covered loss forces you to close — and you have no business interruption coverage
A fire, a storm, a burst pipe forces you to close your business temporarily. Property insurance pays to repair the damage. Without business interruption coverage, the income you lose while the doors are closed, the payroll you still owe, and the fixed expenses that keep running are all on you.

02
A hailstorm damages your roof and you find out you’re on actual cash value
Texas hail events can damage roofs and structures significantly. If your policy is written on actual cash value rather than replacement cost, the depreciation deducted from your claim can be substantial — especially on an older roof. The difference between what the check says and what the contractor charges is yours to cover.

04
A flood causes major damage — and your policy excludes flood
Standard commercial property policies in Texas exclude flood damage. This is one of the most significant and most common coverage gaps for Texas businesses in flood-prone areas. If flooding damages your space without a separate flood policy in place, your property coverage won’t pay for it regardless of how much you’ve been paying in premiums.

06
A tenant thinks they don’t need property insurance because they rent
This is one of the most common misconceptions in small business insurance. Your landlord’s policy covers the building — nothing inside it that belongs to you. If there’s a fire and your equipment, inventory, and contents are destroyed, the landlord’s insurance doesn’t pay you a dollar. Business personal property coverage is what protects tenants, and it’s not automatic.

Why Get Your Commercial Property Through McKnight

The right property program covers what it would actually cost to recover — not just what’s convenient to insure.

Commercial property is one of the most commonly underinsured coverages in small business. Limits get set when a policy is first written and don’t get updated as the business grows, equipment values increase, or inventory expands. A policy that was right three years ago can leave you significantly underinsured at claim time — and by then it’s too late to change it.

We work through the key questions with every property client: Are your building limits based on current replacement cost? Have your contents limits been updated to reflect what you actually have today? Do you have business interruption coverage with a realistic restoration period? Is flood addressed if your location has that exposure? Is your policy written on replacement cost or actual cash value?

These are the questions that determine whether a property loss is a setback or a crisis. As an independent agency working with 100+ carriers, we find the right program for your location, your industry, and the actual value of what you’re protecting.

Building owners and tenants both covered
We address both structure coverage for owners and business personal property for tenants — making sure the right coverage is in place for how you actually occupy your space.

Talk to a specialist →

Limits reviewed for current replacement cost
We check that your limits reflect what it would actually cost to rebuild or replace — not an outdated value that leaves you short at claim time.

Get a review →

Same-day certificates of insurance
Need proof of property coverage for a lease or lender requirement today? We turn COIs around same day.

Call 817.277.6166 →

FAQ

Commercial property questions we hear all the time.

Does commercial property insurance cover the contents of my business?
It depends on how the policy is written. Building coverage and business personal property coverage are two separate things — a policy that covers your building doesn’t automatically cover everything inside it at the same limits. Equipment, inventory, furniture, computers, and tools all need to be specifically addressed. When we build a property program, we look at both the structure and the contents separately to make sure nothing is left unprotected. If you rent your space, contents coverage is even more important — it’s the only property coverage that applies to you.
I lease my space — do I still need commercial property insurance?
Yes — and this is one of the most common misconceptions we encounter. Your landlord’s property insurance covers the building structure. It does not cover a single item inside your space that belongs to you. If there’s a fire and your equipment, inventory, tools, computers, and business contents are destroyed, your landlord’s policy pays nothing toward your losses. Business personal property coverage is specifically what protects tenants, and many commercial leases require it as a condition of occupancy.
What’s the difference between actual cash value and replacement cost?
Actual cash value pays what your property is worth at the time of the loss — meaning depreciation is subtracted from the claim. A five-year-old piece of equipment worth $10,000 new might only generate a $4,000 check under actual cash value. Replacement cost pays what it actually costs to repair or replace the property with new property of like kind and quality, regardless of age. The premium difference between the two is usually modest, but the difference in what you receive on a claim can be significant. We recommend replacement cost coverage for business property consistently.
Does commercial property insurance cover flood damage?
In almost all cases, no. Flood is excluded from standard commercial property policies in Texas. This catches many businesses off guard — particularly in the Houston area, along the Gulf Coast, and in other flood-prone parts of the state. A separate flood insurance policy is required to cover this exposure, and there is typically a 30-day waiting period after purchase before it takes effect. If your business is in a flood-prone area, this needs to be addressed before storm season — not after water has entered your building.
What does business interruption insurance cover?
Business interruption coverage replaces lost income and covers ongoing expenses when a covered property loss forces you to close or significantly reduce operations. It typically covers lost net income, ongoing fixed expenses like rent and payroll during the closure, and extra expenses incurred to keep operating in a reduced capacity. It kicks in after a waiting period — typically 72 hours — and covers you for a defined restoration period. The cost of a property loss is never just the physical damage — business interruption is what protects you from the financial impact of being unable to operate while you recover.
How do I know if my property limits are adequate?
The honest answer is that most business owners don’t know until they have a claim — and by then it’s too late. The key questions are: Are your building limits based on current replacement cost, not purchase price or market value? Have your contents limits been updated to reflect current equipment values and inventory? Has your business grown significantly since the policy was written without a corresponding update to your limits? We review these with every property client to make sure the coverage reflects the real exposure. If you haven’t had a policy review in more than a year, it’s worth a conversation.
Does my property policy cover equipment that leaves my building?
Generally no — or only with very limited coverage. Commercial property policies protect assets at the location listed on the policy. Equipment taken to a job site, tools in a vehicle, inventory in transit, or property at a temporary location typically falls outside that protection. Inland marine coverage is specifically designed to follow your property wherever it goes — making it essential for any business that regularly moves equipment, tools, or materials between locations.
What is a Business Owner’s Policy (BOP) and is it right for me?
A Business Owner’s Policy bundles commercial property and general liability into a single policy at a discounted rate. It’s designed specifically for small and medium-sized businesses and is often the most cost-effective way to get both coverages in place. A BOP is a strong starting point for many businesses — but it typically doesn’t include business interruption, equipment breakdown, or inland marine, which many operations need on top of the base policy. We’ll help you figure out whether a BOP is the right foundation and what additional coverages belong in your program.

Get Started

Let’s make sure you’re covered for what it would actually cost to recover.

Whether you own your building or lease your space, whether you store everything on-site or move assets across Texas — we’ll build a property program that actually makes you whole. No pressure. No jargon. Just straight answers.

Serving Texas businesses across DFW, Houston, San Antonio, Austin  ·  Same-day certificates available