Direct Damage Coverage is a type of property insurance that pays the value of the property that has been damaged or the cost of the property’s repair or replacement. This is in contrast to time element property insurance, which pays for loss of income or increase in expenses that result from the unavailability of the damaged property while it is being repaired or replaced.
Most businesses obtain direct damage coverage by purchasing a commercial property policy. The latter covers loss or damage to business-owned property like buildings, production machinery, office equipment, furniture, and stock. Commercial Property may be insured for a broad list of named perils such as fire, lightning, explosion, wind, and hail.
Commercial Direct Damage policies also provide some protection for loss or damage to property owned by someone else that a company uses in its business. An example is a copy machine leased from an office supply store. However, several types of property are typically insured under other types of insurance, such as Crime Insurance for money, Commercial Auto Insurance for company vehicles, and Inland Marine Insurance for mobile equipment.