Commercial property and business interruption insurance in Ottawa

Part of the series: Business insurance in Ottawa →

A fire, burst pipe or storm can damage what your business owns, then keep you closed for weeks. Commercial property insurance helps repair or replace your building, equipment and stock. Business interruption insurance helps replace lost income and pay ongoing costs while you recover.

What property insurance can cover

• The building, if you own it
• Improvements you’ve made to leased space, such as flooring, fixtures and built-ins
• Equipment, furniture, computers and tools kept at your premises
• Stock and inventory
• Property of others in your care, such as customer items you repair
• Outdoor signs, and money and securities, usually with lower limits

Ask whether your policy pays replacement cost (what it costs to replace with new) or actual cash value (replacement cost minus depreciation). The difference can be large for older equipment.

Business interruption: protecting your income

After a covered loss, business interruption insurance can help pay:

• Lost profit while you can’t operate normally
• Ongoing costs such as rent, payroll and loan payments
• Extra expenses to keep running, such as a temporary location or rented equipment

It usually applies only after direct physical damage from a covered cause, and only for the indemnity period you choose. Choose a period long enough to rebuild and win back customers; after a major loss, permits, contractors and replacement equipment can take many months.

Extensions worth asking about

• Off-premises power or utility interruption: an outage caused by damage away from your premises
• Civil authority: when authorities block access to your premises because of nearby damage
• Contingent business interruption: when damage at a key supplier or customer stops your business
• Spoilage: stock that spoils because of a power outage or equipment breakdown

The co-insurance penalty: why underinsuring costs you

Many commercial property policies include a co-insurance clause, often 80% or 90%. If you insure your property for less than that percentage of its value, the insurer can reduce even a partial claim in proportion.

Update your values every year, since construction and equipment costs change. Ask whether an agreed amount or stated amount endorsement is available to remove the co-insurance condition.

Ottawa weather and water

• Storms and power outages. The May 2022 derecho damaged more than 400 Hydro Ottawa poles and cut power to 180,000 customers; some waited nearly two weeks. Check how your policy handles wind damage, power outages and spoilage.
• Water. Sewer backup, overland flooding and ground water are often excluded unless you add coverage, and availability depends on your location. This matters for businesses near the Ottawa River and in older buildings.
• Earthquake. The Ottawa area is in the Western Quebec Seismic Zone. Earthquake damage is usually excluded from standard property policies but may be available by endorsement.
• Frozen pipes and vacancy. Policies often limit coverage if premises are vacant or unheated for a period, commonly 30 days. Tell your broker before you close for renovations or a long break.

Source: Hydro Ottawa, “Derecho: our biggest storm yet”

Running a business from home?

A home insurance policy usually gives limited or no coverage for business equipment, stock, lost business income or liability to clients. If clients visit, you store stock or you rely on expensive equipment, tell your home insurer and ask about a home-business endorsement or a separate small business policy.

This guide is general information, not legal or insurance advice. Coverage depends on each insurer’s policy wording, including exclusions, conditions, limits and deductibles. Requirements from the City of Ottawa, WSIB and other sources were checked in September 2026 and can change, so always confirm the requirement in your own contract, lease or permit.