Chapter 13 Businessowners Coverage Form
____ or insolvency of the insured does not relieve the insurance company of its responsibilities under the policy.
Bankruptcy
The First Named Insured shown in the Declarations may cancel this policy by mailing or delivering to the insurance company advance written notice of cancellation. The insurance company may cancel the policy by mailing or delivering to the First Named Insured written notice of a cancellation at least: 5 days before the effective date of cancellation if any of the following conditions exists. The building has been vacant or unoccupied 60 or more consecutive days. After damage by a covered cause of loss, if permanent repairs to the building: have not started & have not been contracted for within 30 days of initial payment of loss. 10 days before the date of cancellation if the insurance company cancels for non-payment of premium. 30 days before the date of cancellation if the insurance company cancels for any other reason. Notice must be mailed to the last known mailing address. All requirements of notice as contained in the policy may be superseded by state law.
Cancellation
The First Named Insured shown in the Declarations is authorized to make policy changes with the insurance company's consent & only by written endorsement issued by the insurance company.
Changes
The coverage applies when civil authorities prohibit access to the described premises due to a covered loss that occurs within 1 mile of the insured's property. The coverage begins 72 hours after the action occurs & ends 4 consecutive weeks after the coverage begins.
Civil Authority
Policy is void in any case of fraud by the insured as it relates to the policy.
Concealment, Misrepresentation & Fraud
Mercantile, wholesale, service or processing 7 contracting occupancies.
Condominium Commercial Unit-Owners
Eligible _____ include those whose total annual payroll does not exceed $300,000 & no more than 10% of total gross sales comes from subcontracted work.
Contractors
Newly Acquired or Constructed Property Personal Property Off Premises Outdoor Property Personal Effects Valuable Papers & Records Accounts Receivable
Coverage Extensions
Risk of direct physical loss (open peril), unless the loss is excluded.
Covered Causes of Loss
Buildings & structures at the premises described in the Declarations, including: completed additions, fixtures, including outdoor fixtures, permanently installed machinery & equipment, the insured's personal property in apartments, rooms, or common areas furnished by the insured as landlord, personal property owned by the insured that is used to maintain or service the buildings or structures, or the premises, including firefighting equipment; outdoor furniture; floor coverings; & appliances used for refrigerating, ventilating, cooking, dish washing or laundering, outdoor furniture, if not covered by other insurance: additions under construction, alterations & repairs to the buildings or structures; materials, equipment, supplies, & temporary structures, on or within 100 feet of the described premises. Business Personal Property located in or on the buildings at the described premises or in the open (or in a vehicle) within 100 feet of the premises, including: property the insured owns that is used in the insured's business, property of others that is in the insured's care, custody or control, tenant's improvements & betterments, which are fixtures, alterations, installations, or additions made a part of the building or structure that the tenant occupies but does not own; including structures that the tenant acquired or made at their expense, but cannot legally move, leased personal property for which the insured has legal responsibility to insure.
Covered Property
Once a loss exceeds the deductible shown in the Declarations, the policy pays the amount of the loss or damage in excess of the deductible, up to the applicable limit of insurance shown on the Declarations under Section I - Property. The standard deductible is $500 & the insured may choose a higher or lower deductible. Other special deductibles may apply to Optional Coverages, if any are chosen. No deductible applies to the following Additional Coverages: Fire Department Service Charge, Business Income, Extra Expense & Fire Extinguisher Recharge Systems
Deductibles
Up to $10,000
Electronic Data
The Businessowners policy was designed for small to medium sized businesses that don't engage in high-risk or highly specialized operations. Businesses that generate sales over $6 million or that occupy more than 35,000 square feet or space are ineligible, unless otherwise noted. Other requirements also apply. Each insurance company will have specific eligibility requirement but most conform to certain standards. The types of businesses eligible for BOP include: Apartment Buildings Office Buildings Service or Processing Wholesalers Contractors Restaurants Motels Convenience Food/Gasoline Stores Self-Storage Facilities Condominium Commercial Unit-Owners
Eligible Risks
This coverage provides insurance for Business Personal Property, including money & securities, resulting from dishonest acts committed by any of the insured's employees acting alone or in collusion with other persons.
Employee Dishonesty
The policy does not cover loss or damage caused directly or indirectly by any of the following: Ordinance or Law Earth Movement Governmental Action Nuclear Hazard Utility failure that occurs off-premises War & military action Water Certain computer-related losses relating to failure, malfunction, or inadequacy of computer hardware, software, operating systems & networks Fungi, wet or dry rot Pollution Neglect Collapse Wear & Tear Equipment Breakdown Electrical apparatus Virus or bacteria Smoke, vapor or gas from agricultural smudging or industrial operations Artificially generated electrical current Loss of use, loss of market or delay Steam apparatus Dishonesty of an insured False pretenses Exposed property Errors & omissions Installation, testing or repair Electrical disturbance Negligent work Loss or damage to products resulting from errors or omissions during production
Exclusions
Expected or Intentional Injury Contractual Liability Liquor Liability Workers' Compensation & Similar Laws Employer's Liability Pollution Aircraft, Auto or Watercraft Mobile Equipment - Transportation of mobile equipment War Professional Services Damage to Insured's Property Damage to Insured's Product Damage to Insured's Work Damage to Impaired Property or Property Not Physically Injured Recall of Products, Work or Impaired Property Personal & Advertising Injury
Exclusions Applicable to Business Liability Coverage
To any insured, except volunteer workers. To a person hired to do work for, or on behalf of, any insured or tenant of any insured. To any person, if benefits for the bodily injury are payable, or if benefits must be provided under Workers' Compensation. To a person injured on that part of the premises the insured owns or rents & that the person normally occupies. To a person injured while taking part in athletics. To bodily injury incurred within the products/completed operations hazard. To bodily injury excluded under Business Liability Coverage. Due to war, including civil war, insurrection, rebellion, or revolution.
Exclusions Applicable to Medical Expenses Coverage
The policy will pay for the necessary extra expenses the insured incurs for up to 12 consecutive months after the date of direct physical loss or damage. This additional coverage is not subject to the limits of insurance in Section I.
Extra Expense
When the policy is certified as proof of financial responsibility for the future under the provisions of any motor vehicle financial responsibility law, the insurance is provided by the policy & will comply with that law.
Financial Responsibility Laws
The BOP may be cancelled by _____.
First Named Insured
All losses, except those that fall within the products-completed operations hazard, including medical expenses personal injury & advertising injury offenses committed; aggregate limit is twice the Liability & Medical Expenses limit shown in the Declarations.
General Aggregate
The policy will pay for the expenses incurred to install a temporary plates, board up openings, & to remove or replace obstructions when repairing or replacing glass that is part of a building.
Glass Expenses
The policy will pay up to $2,500, for each building, for the increased costs incurred to comply with enforcement of an ordinance or law that regulates the repair, rebuilding or replacement of damaged parts of a covered building following a covered loss.
Increased Cost of Construction
Automobile repair & service stations; automobile, mobile home, & motorcycle dealers; & parking lots or garages are ineligible, unless these operations are incidental to an otherwise eligible risk. Restaurants, bars, grills are ineligible (unless fast-food restaurant or others with limited cooking). Places of amusement are not eligible. Manufacturers are ineligible.
Ineligible Risks
The insurance company has the right, but is not obligated, to make inspections & surveys at any time. Inspections & surveys don't warrant that conditions are safe or comply with law.
Inspection & Surveys
No person or organization has a right under the policy to sue the insurance company unless all terms of the policy have been fully complied with.
Legal Action Against the Insurance Company
Section II - Liability of the Businessowners Coverage Form contains a list of definitions that clarify policy language. The definitions in this section are similar to those found in the CGL & CPP. It's important to remember that the definition of "your product" includes: Warranties & representations relating to the fitness of the product. Warnings & instructions for safe use of the product. Containers for the product.
Liability & Medical Expenses Definitions
Bankruptcy Duties in the Event of Occurrence, Offense, Claim or Suit Financial Responsibility Laws Legal Action Against the Insurance Company Separation of Insureds
Liability & Medical Expenses General Conditions
If the insurance company adopts any revision that would broaden coverage under the policy without additional premium within 45 days prior to, or during, the policy period, the broadened coverage will immediately apply to the policy.
Liberalization
Up to $15,000
Limited Fungi, Wet Rot or Dry Rot
The most the policy will pay for loss or damage, in any one occurrence, is the applicable limit of insurance under Section I - Property, as shown in the Declarations. The most the policy will pay for damage to outdoor signs attached to the building is $1,000 per sign per occurrence. The limit of insurance for Buildings will automatically increase by 8% unless a different percentage is shown in the Declarations. An automatic seasonal increase applies to the limit of insurance for business personal property. If no percentage is shown on the declaration, the policy will automatically provides a limit increase of 25% for seasonal fluctuations in value. This seasonal increase only applies if the limit shown for business personal property in the Declarations is at least 100% of the insured's average monthly values during the 12 months immediately preceding the loss.
Limits of Insurance
The BOP will make loss payment at the insurance company's option, in one of the following ways after a property loss: payment for the value of the loss or damaged property, payment for the cost to repair or replace the lost or damaged property, take all or part of the property at an agreed or appraised value, repair, rebuild or replace damaged property with property of like kind & quality. No loss payment will exceed the insured's financial interest in covered property. Coverage is provided for a party wall, which is a wall that separates adjoining units or buildings owned by different parties. The insured is paid a proportion of the loss based on the insured's proportion of the wall, which is a wall that separates adjoining owner's proportion of the wall. If the other owner does not repair his proportion of the wall, the insurance will pay for the entire wall & subrogate against the adjoining owner. Loss settlement includes property valuation at replacement value for most types of covered property unless the declarations page shows loss settlement is on an actual cash value basis. Although a true coinsurance provision is NOT included in the BOP, an insurance-to-value provision is included. This means that in the event of a partial loss, if property is insured for less than 80% of its replacement value, a penalty will be applies to the loss payment.
Loss & General Conditions
_____ is NOT a characteristic of an eligible risk for the BOP.
Manufacturing Occupancy
Covers necessary medical expenses for bodily injury, caused by an accident, occurring on the premises the insured owns or rents, or due to the insured's operations. The accident must take place in the coverage territory & during the policy period. The expenses must be incurred within 1 year of the date of the accident. Payments are made regardless of fault. The insurance company's will pay reasonable expenses for: first aid administered at the time of an accident, necessary medical, surgical, x-ray, & dental services, including prosthetic devices, necessary ambulance, hospital, professional nursing, & funeral services.
Medical Expenses
This coverage provides insurance for money & securities used in the insured's business against theft, disappearance, or destruction while: at a bank or savings institution; within the living quarters of the insured, or the living quarters of partners, managers, or employees of the insured; at the described premises; or in transit between any of these places.
Money & Securities
The policy will pay up to $1,000 for any one loss resulting from the insured having accepted, in good faith, money orders issued by the post office, bank, or counterfeit paper currency during the regular course of business.
Money orders & Counterfeit Paper Currency
Buildings are limited to 2 stories in height; the motel may not be seasonal in its operation, & may not contain a bar or cocktail lounge.
Motels
Each building is insured for up to $250,000 for up to 30 days. Business personal property at each building is covered for up $100,000 for up to 30 days.
Newly Acquired or Constructed Property
_____ that are occupied primarily for office purposes that do not exceed 6 stories in height or contain more than 100,000 square feet in total area.
Office Buildings
Which covered causes of loss form is used for the BOP?
Open Perils
If shown as applicable by an entry in the Declarations: Outdoor Signs Money & Securities Employee Dishonesty Equipment Breakdown
Optional Coverages
If there is other insurance in place to cover the same loss or damage, the insurance company will only pay for the amount of covered loss or damage in excess of the amount due from that other insurance. Business Liability Coverage is excess over any other insurance that insures for direct physical loss or damage.
Other Insurance
The insured may extend the insurance provided by the policy to apply to their outdoor fences, radio & television antennas, signs (other than signs attached to buildings), trees, shrubs & plants. The most the policy will pay is $2,500 but not more than $1,000 for any one tree, shrub or plant.
Outdoor Property
This coverage provides insurance for direct physical loss (open perils) of, or damage to, all outdoor signs at the described premises.
Outdoor Signs
Section I - Property of the BOP covers _____ type of property.
Outdoor furniture
Caused by or at the direction of the insured with the knowledge that the fact would violate the rights of others & inflict personal & advertising injury; knowledge of oral or written publication of material known to be false, offenses that took place before the beginning of the policy period; losses arising out of breach of contract, failure to conform to advertised quality, or the wrong price. Also excluded are injuries committed by an insured whose business is advertising, broadcasting, publishing or telecasting.
Personal & Advertising Injury
The insured may extend the insurance that applies to Business Personal Property to apply to person effects owned by the insured, the insured's officers, partners, managers or employees up to $2,500 at each described premises.
Personal Effects
The policy will pay up to $10,000 per location for pollution cleanup & removal due to a covered loss occurring during each separate 12 month period.
Pollution Cleanup & Removal
The first Named Insured shown in the Declarations: is responsible for the payment of all premiums & will be the payee for any return premiums insurance company pays.
Premiums
The policy will cover on an open perils basis, for up to 30 days, property while being moved or temporarily stored at another location to save & protect it from damage by a covered peril.
Preservation of Property
Earthquake Endorsement Protective Safeguards Endorsement Named Perils Endorsement Hired Auto & Non-Owned Auto Liability Endorsement The Utility Services - Direct Damage Endorsement The Utility Services - Time Element Endorsement
Property Endorsements
If the insured is able to use damaged or undamaged property to resume operations after a covered business income loss - & doesn't do so - the policy will reduce the amount of the business income payment to the extent of the resumption of operations that should have been made.
Resumption of Operations
Business Liability Medical Expenses Exclusions Exclusions Applicable to Medical Expenses Coverage Who is an Insured Liability & Medical Expenses Limits of Insurance Liability & Medical Expenses General Conditions Liability & Medical Expenses Definitions
Section II - Liability Coverages
Cancellation Changes Concealment, Misrepresentation & Fraud Examination of Your Books & Records Inspection & Surveys Insurance under Two or More Coverages Liberalization Other Insurance Premiums Transfer of Rights of Recovery Against Others to Us Transfer of Your Rights & Duties under this Policy
Section III - Common Policy Conditions
Buildings are limited to 2 stories in height. Cold storage or storage of industrial materials, chemicals, pollutants & waste do not qualify.
Self-Storage Facilities
Insurance applies as if each named insured were the only named insured, & separately to each insured against whom claim is made or suit is brought.
Separation of Insureds
_____ businesses such as bakeries, laundromats, dry cleaners, funeral homes, & print shops.
Service or Processing
_______ regarding standard limitations under the BOP's Section I - Property limits of insurance is NOT correct.
The Buildings limit of insurance will automatically increase 10% each year
If any person or organization for whom the insurance company makes payment under the policy has rights to recover damages from another, those rights are transferred to insurance company to the extent of insurance company's payment.
Transfer of Rights of Recovery Against Others to Us
Insured's rights & duties under this policy may not be transferred without insurance company's written consent except in the case of death of an individual Named Insured.
Transfer of Your Rights & Duties under this Policy
The policy will pay the cost to tear out & replace nay part of the building or structure to repair damage to the system or appliance from which the water or other substance escaped.
Water Damage, Other Liquids, Powder, or Molten Material Damage
The insured may extend up to how much of the insurance for business personal property to property located off-premises?
$10,000
The Additional Coverage for business income pays for the actual loss of business income for up to how many months after the date of direct physical damage to the property?
12
Under Section II - Liability & Medical Expenses, ____ is covered for medical expenses after being injured while at an insured premises.
A client of the insured
Named insured, members & managers.
A limited liability company
The named insured, members, partners & their spouses.
A partnership or joint venture
Named insured & its trustees with respect to trustee duties.
A trust
The insured may extend the insurance that applies to Business Personal Property to apply to the direct physical loss of records of accounts receivable up to $10,000 at the described premises & up to $5,000 away from the described premises.
Accounts Receivable
_____ of any size, including residential condominium associations.
Apartment Buildings
Coverage Covered Property Property Not Covered Covered Causes of Loss Limitations Additional Coverages Coverage Extensions Exclusions Limit of Insurance Deductibles Los & General Conditions Optional Coverages
Businessowners Coverage Form Section I Property
____ is defined as an abrupt falling down or caving in of a building or any part of a building assumed that the building or part of the building cannot be occupied for its intended purpose.
Collapse
The total annual gross receipts from the sale of gasoline must not exceed 75% of the total annual gross receipts. Auto service repair, car wash operations, & propane or kerosene tank filling operations are not allowed.
Convenience Food/Gasoline Stores
Section I addresses the property coverages afforded by the policy. This section provides details of covered property, property not covered, additional coverages, coverage extensions, exclusions, limits of insurance, deductibles, property conditions, property general conditions, property definitions, & optional coverages - if shown on the declarations with a premium charge.
Coverage
What is the method of property valuation under the Businessowners Policy (BOP)?
Replacement Cost
Those that are designated in the Declarations as: A sole proprietorship or Individual A partnership or joint venture A limited liability company A trust Each of the following is also an insured: volunteer workers, while performing duties related to the conduct of the insured's business, & employees of the named insured. Any person or organization, while acting as the named insured's real estate manager. Any person or organization having temporary custody of the named insured's property, until a legal representative is appointed if the named insured dies. The insured's legal representative if the named insured dies. A party is an insured only with respect to the conduct of the insured business. An organization other than a partnership, joint venture, or limited liability company. The named insured, executive officers & directors, & stockholders.
Who is An Insured
_____ is NOT an insured under the BOP.
A sole proprietor's minor child
Named insured & his/her spouse.
A sole proprietorship or individual
This coverage provides insurance for equipment breakdown to pressure, mechanical, or electrical machinery & equipment owned by the insured or in the insured's care, custody or control & at the described premises.
Equipment Breakdown
_____ is NOT covered under the BOP.
Errors & Omissions
Insurance company may examine & audit the books & records as they relate to the policy during the policy period & up to 3 years afterward.
Examination of Your Books & Records
Exclusions Applicable to Business Liability Coverage Exclusions Applicable to Medical Expenses Coverage
Exclusions
The policy will pay up to $2,500 for the insured's liability for fire department service charges assumed by contract or agreement prior to loss, or required by local ordinance.
Fire Department Service Charge
If two or more insurance policies apply to the same loss or damage, the policy will not pay more than the actual amount of loss.
Insurance under Two or More Coverages
For interruptions caused by the specified causes of loss & certain computer viruses - up to $10,000.
Interruption of Computer Operations
The Limits of Insurance shown in the Declarations, is the most the insurance company will pay regardless of the number of insureds, claims made or suits brought, or persons or organizations making claims or bringing suits. The Liability & Medical Expenses limit shown in the Declarations applies per occurrence for bodily injury, property damage & medical expenses, & per person or organization for personal injury & advertising injury. The Medical Expenses limit shown in the Declarations is the most the insurance company will pay for all medical expenses sustained by any one person. The Damage to Premises Rented to You limit shown in the Declarations applies to damage arising out of any one fire or explosion for property damage caused to premises rented to the insured or temporarily occupied by the insured with the permission of the owner. Two aggregate limits apply: Products-completed operations aggregate General aggregate The aggregate limits do not apply that involve Damage to Premises Rented to You.
Liability & Medical Expenses Limits of Insurance
The insurance company will not pay for loss or damage to property that is messing, where the only evidence of loss or damage is a shortage discovered when taking inventory, or other instances where there is no physical evidence to show what happened to the property. For loss or damage by theft, the following types of property are covered only up to $2,500 for: furs, fur garments, & garments trimmed with fur, jewelry, watches, pearls, precious & semi-precious stones, bullion, gold, silver, platinum, & other precious alloys or metals, patterns, dies, molds, & forms. No coverage is provided for loss to seam or hot water boilers, pipes ,engines, or turbines if it caused by an equipment breakdown, other than an explosion. Loss to the interior of a building or structure is not covered unless the exterior also sustains damage. Animals & fragile articles are only covered if loss is caused by the "specified causes of loss" or glass breakage.
Limitations
The insured may extend up to $10,000 of the insurance that applies to Business Personal Property to property while it is in the course of transit or at premises the insured does not own, lease, or operate. This extension does NOT cover money, securities, valuable papers & records, or accounts receivables.
Personal Property Off Premises
All claims for bodily injury, & property damage that occur during the policy period & fall within the products completed operations hazard; aggregate limit is twice the Liability & Medical Expenses Limit Shown in the Declarations.
Products-completed operations aggregate
Aircraft, automobiles, motor trucks, & other vehicles subject to motor vehicle registration. Money or securities, except as provided in the Money & Securities Optional Coverage or Employee Dishonesty Optional Coverage. Land, including land on which the property is located, water, growing crops or lawns. Outdoor fences, radios, or television antennas, satellite dishes, & their lead-in wiring, masts or towers, signs (other than signs attached to the building), trees, shrubs, or plants. Watercraft & associated equipment, while afloat. Accounts, bills, food stamps, other evidence of debt, accounts receivable or valuable papers & records, except as otherwise provided in the policy. Computers that are permanently installed or designed to be permanently installed in any aircraft, watercraft, motor truck or other vehicle subject to motor vehicle registration, except while held as stock. Electronic data other than as provided under additional coverages. Animals, unless held for sale or being boarded for others by the insured, or, if owned by the insured as stock while inside the building. Property transferred per unauthorized instructions is not covered.
Property Not Covered
The insured may extend the insurance that applies to Business Personal Property to apply to direct physical loss of valuable papers & records it owns or that are in its care, custody or control up to $10,000 at the described premises & up to $5,000 away from the described premises.
Valuable Papers & Records
Buildings & personal property for businesses operating as _____ provided that no more than 25% of annual gross sales are derived from retail operations, & no more than 25% of the total floor area is open to the public.
Wholesalers
The policy will pay up to an additional $10,000 for debris removal expense, for each location, in any one occurrence of physical loss or damage to covered property if the total of the actual debris removal expense plus the amount paid for the direct physical loss or damage exceeds the limit of insurance on the covered property.
Debris Removal
The insurance company must be notified, as soon as practical, of an occurrence or an offense that may result in a claim.
Duties in the Event of Occurrence, Offense, Claim or Suit
Fast-food restaurants & others with limited cooking.
Restaurants
Debris Removal Preservation of Property Fire Department Service Charge Collapse Water Damage, Other Liquids, Powder, or Molten Material Damage Business Income Extra Expense Pollution Cleanup & Removal Civil Authority Money Orders & Counterfeit Paper Currency Forgery or Alteration Increased Cost of Construction Business Income from Dependent Properties Glass Expenses Electronic Data Interruption of Computer Operations Limited Fungi, Wet Rot or Dry Rot
Additional Coverages
The policy will pay for the actual loss sustained for a period of 12 consecutive months after the date of direct physical loss or damage. However, ordinary payroll expenses are paid only for 60 days following the direct physical loss or damage, unless a greater number of days is shown in the Declarations. This additional coverage is not subject to the limits of insurance in Section I.
Business Income
The policy will pay the actual loss of business income (up to $5,000) sustained by the insured due to physical loss or damage at the premises of a dependent property caused by or resulting from a covered cause of loss.
Business Income from Dependent Properties
Section II addressed the liability coverages afforded by the policy. This section provides details of the liability & medical expenses, exclusions, who is an insured, limits of insurance, liability general conditions & definitions. Liability coverage is provided for sums for which the insured becomes legally liable to pay as damages for bodily injury, property damage, or personal injury & advertising injury, including liability assumed under an insured contract. Coverage applies to: bodily injury or property damage caused by an occurrence that takes place in the coverage territory during the policy period. Personal injury & advertising injury caused by an offense arising out of the insured's business, but only if the offense takes place in the coverage territory during the policy period. Bodily injury includes damages claimed by any person or organization for care, loss of services, or death resulting at any time from bodily injury. Includes defense. Coverage Extension - Supplementary Payments. In addition to the limit of insurance for Section II - Liability, the insurance company will pay: all expenses incurred by the insurance company, up to $250 for the cost of bail bonds, required because of accidents or traffic violations arising out of the use of any vehicle to which coverage for bodily injury applies. The cost of bonds to release attachments, but only for bond amounts within the limit of insurance. All reasonable expenses incurred by the insured, at the request of the insurance company, including actual loss of earnings up for to $250 per day for time off work. All costs taxed against the insured in a suit. Prejudgment interest awarded against the insured on the part of any judgment. All interest on the full amount of any judgment that accrues before the judgment is paid.
Business Liability
Unlike the Commercial Package Policy, which was designed to accommodate the needs & exposures of larger businesses, the BOP contains features that are automatically included & better serve the needs & exposures of small to medium-sized businesses. Such features include: the method of valuation on the building & business personal property is replacement cost, provided that at the time of the loss the limit of insurance on the lost or damaged property is 80% or more of the full replacement cost of the property. The limit of insurance for the building is automatically increases by an annual percentage shown in the Declarations, divided by 365 (the amount of insurance applicable on any given day). Business Income & Extra Expense coverages are automatically included, & the policy pays the actual loss sustained for up to 12 consecutive months during the "period of restoration" following a covered direct loss. The "period of restoration" begins 72 hours after the time of direct physical loss, & ends when repairs are completed or when business resumes at a new permanent location.
Businessowners Policy Features
Resumption of operations. The vacancy provision of the BOP is the same as that found in the commercial building & personal property coverage form. If the insured is a tenant, the rented unit is considered vacant if it doesn't contain enough personal property for the insured to conduct customary operations. If the insured is a building owner or the general lessee of an entire building, the building is considered vacant if less than 31% of the building's square footage is not rented to lessees, or used by the building owner, to conduct customary operations. Buildings under construction or renovation are NOT vacant. If the building where a loss occurs has been vacant for 60 or more consecutive days before a loss, NO coverage is provided for losses of the following types: vandalism, sprinkler leakage (unless the system was protected against freezing), building glass breakage, water damage, theft or attempted theft. If a loss caused by other perils occurs in or to a vacant building, a penalty of 15% will be applied to the loss payment.
Loss & General Conditions
