CIC- Commercial Property

Additional coverages: Fire department service charge

$1,000 fire department service charge for EACH PROPERTY. no matter how may departments arrive or what services are provided max of $1000. NO DEDUCTIBLE APPLIES

Electronic Data- Additional Coverages

$2,500 AGGREGATE limit available for each policy year limit applies regardless of the number of occurrences/premises/locations/computer systems coverage applies to data that has been detroyed/corrupted by one of the named causes of loss if a covered cause of loss is added by endorsement, the additional cause of loss will not apply to this additional coverage -perils for this coverage are virus, harmful code or similar instructions introduced into or enacted on a computer system (unless installed by a employee) IN ADDITION TO LIMIT OF INSURANCE

What is the coinsurance equation?

(Amount carried/ amount required) x loss = recovery minus deductible equals settlement

Debris Removal Equation

(Paid Loss+ Deductible)x25%+$25,000= Debris Removal

Disadvantages for blanket coverage

1. 90-100% co insurance required 2. Underwriting restrictions 3. Statement of values required 4. Rates for one year only 5. Same causes of loss for all property 6. List all ownership interest w multiple locations

Seven Loss Conditions

1. Abandonment 2. Appraisal 3. Duties in the event of loss or damage 4. Loss payment 5. Recovered Property 6. Vacancy 7. Valuation

Endorsments available to Outdoor Property

1. Additional covered property -used to insure fences -definition of covered property includes fences -subject to the causes of loss form selected (basic, broad, special) 2. Radio or television antennas 3. Trees, Shrubs plants (loss caused by vehicles can be excluded)

What is BPP

1. Any contents in or working 100 feet of the structure or premises 2. Fixtures that can be removed 3. Machinery & equipment 4. Stock (merchandise held in storage or for sale, covers labor and materials put into customers property) I.e a bunch of fixed computers

First named insureds rights and duties

1. Authorized to cancel 2. Receive notice of cancellatoon 3. Make changes with insurer consent 4. Responsible for payment of all premoums 5. Payee for return premoums

Blanket coverage advantages

1. Can apply Ins where needed 2. Handles fluctuating values 3. Reporting forms are easier 4. Insured my have 100% insurance to value but only carrying 90% for all locations combined

What is considered building for coverage

1. Completed additions 2. Fixtures including outdoor furniture 3. Machinery and equipment (permanently installed) 4. Personal property used to service the building or premises A. Fire extinguisher and other equipment B. Outdoor furniture like park benches C. Floor coverings (large rugs) D. Cooking appliances, refrigerators dishwashers washers dryers 5. If not covered by other insurance (like additions to the building) (I don't understand how this is possible considering builders risk)

CPP conditions

1. Concealment misrepresentation or fraud 2. Control of property 3. Insurance under two or more coverages 4. Legal actions against us 5. Liberalization 6. No benefit to bailee (waiver of subrogation) 7. Other insurance 8. Policy period coverage territory

6 additional coverages in BPP

1. Debris removal 2. Preservation of property 3. Fire Department service charge 4. Pollutant Clean up and removal 5. Increased cost of construction 6. Electronic Data

What triggers coverage

1. Direct physical loss or damage 2. Must be a covered property 3. Must be at the premises described in the dec 4. Covered cause of loss

Common policy dec info

1. Eff date 2. Named insured 3. Description of premises 4. Coverages provided (building, bpp, business income; limit of insurance; covered causes of loss-by item; coinsurance, rates)

What items are separate from the limit of insurance shown in the dec?

1. Fire department service charge 2. poolutant clean up and removal 3. increased cost of construction 4. electronic data

What are the seven coverage extentions

1. Newly Acquired or Constructed Property 2. Personal effects and property of others 3. valuable papers and record (other than electronic data) 4. property off premises 5. outdoor property 6. non-owned detached trailers 7. business personal property temporarily portable storage units

Blanket coverage

1. One limit that applies to more than one type of property. Building $500,000 BPP $300,000 blanket on building and ybbp $800,00 2. One limit that applies to one or more types of property.. all building values and bpp added (no matter where it is located) to equal blanket amount

When can you waive your right?

1. Prior to a loss in writing 2. After a loss in writing to these people: Someone insured by this insurance A business firm owned or controlled by you or that owns or controls you Your tenant

What is in the insurance agreement portions of the policy

1. Property covered 2. Property not covered 3. Covered causes of loss 4. Additional coverages 5. Coverage extensions

What are the types of property not covered

1. Some excluded because it is customarily insured under another policy 2. Some excluded because it is relatively unsusceptible to loss 3. Some excluded because it's susceptible to loss 4. Exceptions made for certain types of property held for sale by named insured 5. Restricted coverage for certain types of property

What are the four optional coverages

1. agreed value 2. inflation gaurd 3. replacement cost 4. extension of replacement cost to personal property of others

Coverage Extensions- Newly Aquired or constructed property

3 key parts 1. buildings 2. Your business personal property 3. Period of Coverage

3 categories of covered property

A. Building B. Your business personal property C. Personal property of others

BPPCF preamble

A. Coverage (insuring agreement) B. Exclusions and limitations C. Limits of insurance D. Deductible E.loss conditions F.additional conditions G. Optional coverages H. Definitions

Limitation on loss settlement- blanket insurance (margins clause)

Basically a percentage that says you can pay more than this % for a blanketed building... ex: buildings 1-3 are on a blanket of $4,500,000.. combined values of these buildings are $5,000,000. Co insurance requirement of 90%.. no penalty. Value of building 1 according to statement of values is $1,000,000 margins clause % is 110% maximum loss payable to building is $1,100,000 ($1,000,000 x 1.10)

Your business personal property- separation of coverages endorsement

Basically if your tenant adds a bunch of stuff to the store they need for them to operate and they want to insure those items this endorsement is added as we both have interest in the items

BPPCF

Building and personal property coverage form

Coverage extensions- Property off Premises

Coverage for -Temporarily at a location but NOT at location owned/leased/operated -storage at a leased location, if the lease began after the beginning of the current policy term -at any fair trade shows or exhibition This extension does not apply -in or on a vehicle -in the CCC of your salesperson unless at a fair , tradeshow, or exhibit The most paid under this extension is $10,000 endorsement available: Specified Business Personal Property temporarily away from premises

Endorsements for Deductibles

Deductibles by location -can have separate deductibles on diffrent locations -in the event of a single occurence at multple locations a separate deductible will apply for the damages at each location Multiple deductible form -has separate deductibles for windstorm/hail and theft windstorm or hail percentage deductible -specifying either 1%, 2% or %5 ded for windstorm or hail -ded is calculated separately for each building and the personal property at each building

Correct reporting

Even though loss amount is higher than reported amount, as long as reported amount is accurate and on time the loss will be paid accurately

Additional covered property endorsement

Expands definition of covered property Can be used to buy back certain property that is under property not covered Important to included values in LOI

Value reporting form

Fluctuating personal property values that are unpredictable.. goes of of actual values.. insured needs to be willing to file reports on a regular basis. Eligible property is personal property of named insured & others & stock only.

loss conditions- duties in the event of loss or damage

Gives insured duties and insurer rights 1. notify the police if needed 2. give company prompt notice 3. give description of how where when and why 4. take all responsible steps to try and rpevent futher damage 5. give complete inventories of damaged and undamaged property 6. permit us to inspect property and look at anything else of our request 7. send a signed sworn proof of loss 8. cooperate with us in the investigation or settlement of the claim

endorsement available for electronic data?

Higher limits endrosement to increase coverage amount, another way to address this issue is through Electronic data protection (EDP) Policies

Additional property not covered

In additional to modifying your building property this endorsement can modify your BPP. (Stone quarry has large amounts of rock and stone (stock) this stock poses little risk for covered cause of loss so insured doesn't want to ensure it. Ensured can you send me the address please this endorsement to his policy so he doesn't have to value in the stock value in his limit of insurance)

example of debris removal limit

Limit of Insurance $90,000 Ded $500 Amount of loss: $50,000 Amount of loss Payable: $49,500 (50,000-500) Debris Removal Expense: $10,000 Debris Removal Expense Payable: $10,000 ($10,000 is 20% of $50,000)

endorsements available for valuation conditions

Manufacturers selling price -insured paid for the profit that would otherwise have been earned from the sale if it hadnt been damaged in claim Market Value Stock -insured to be paid the market value of stock that is bought and sold Manufacturers consequential loss assumption -insured to recover the reduction in value of undamaged stock in the process of manufacture that is caused by damage to other stock (for sets of products) Functional personal property valuation (other than stock) -allows insured to replace personal property with the most closely equivalent property available coinsurance does not apply

Full reporting

Must be accurate if not accurate the did/should formula applies (reported/required) x loss = recovery (up to limit of insurance)

Reporting provisions

New policy first report due 60 days.. renewal policy firs report due 30 days, all subsequent reports due 30 days.

Transfer of Rights of Recovery Against Others to Us

Once payment is made to you & other party the right has been transferred to the company.

Specific coverage

One location, specific amount of insurance applies to each type of property

In excess report

Policy limit applies (will pay up to but no more than)

Under reported

Policy pays the percentage reported

Failure to submit reports (first report)

Policy will not pay more than 75% of what it would otherwise have paid

Subsequent reports late

Policy will pay no more than values shown. On the most recent report at the most recent location (reported auagust of $300,000.. no reports then loss in December of $700,000 amount paid would be $300,000)

Peak season endorsement

Prorated amount for higher inventory for specific dates (ex: flower shop, peak seasons are Mother's Day & weddings)

Optional coverages

Replacement cost & agreed value

Additional property not covered endorsement

Saying tenant improvements are not covered on policy

Mortgageholders

Separate rights separate duties

3 ways of writing Commercial property Insurance

Specific coverage Scheduled coverage Blanket coverage

optional coverage- agreed value

Suspends Coinsurance, this does not remove it but SUSPENDS it.. coinsurance reinstates when the policy renews or at the agreed value expiration date (there is an additional premium charge of 5%)

CE- Business Personal Property Temporarily in Portable Storage units

Temporarily stored in a portable storage unit located within 100 feet or building or structure or 100 ft of the described premises-whichever is greater -90 days maximum from when storage unit on premises -not more than $10,000 -Not applicable if otherwise covered and NOT applicable to loss or damage to storage unit itself Endorsements available: Higher Limits

any endorsmeents for CE-Valuable papers and records?

The higher limits endorsement or get an inland marine coverage form

Loss conditions- Abandonment

There can be no abandonment of any property to us.

Debris Removal Additional Insurance endorsement

This endorsement provides a way to increase the 25000 for additional debris removal expense Would want to consider for buildings attached to others or containing pollutants or hazardous substances. (anything that might increase debris removal)

The valuation loss condition under the BPPCF automatically provides coverage on an actual cash value basis except as otherwise provided True or False?

True?

Scheduled coverage

Two or more locations , still a specific amount of insurance applied to each type of property at each separate location scheduled

loss conditions-valuation

a. ACV except as otherwise provided b. Building damage $2,500 or less/coinsurance satisfied, pays cost of repairs or replacement NOT including increased costs of construction The following is ACV even when attached to a building 1. Awnings or floor coverings 2. certain appliances 3. outdoor equipment or furniture c. Stock (sold but not delivered) at selling price minus expenses not incurred d. glass at cost of any required saftey glazing materials e. special valuation for tenants improvements and betterments (if there is RC on building then RC replaces ACV in this valuation loss conditions)

optional coverages- replacement cost

a. replaces ACV in loss condition-valuation b. Does NOT apply to: - personal property of others -contents of a residence -works of art rare articles etchings pictures statuary marbles bronxes porcelains and bric a brac or -stock unless the including stock option is shown in the dec c. claim may be made for aCV-intent to make RC claim within 180 days d. must be repaired/replaced as soon as reasonably possible -special provision for tenants betterments and improvements e. least of: -the limit of insurance applicable -the cost to replace with other property (a) of comparable material and quality and (b) used for the same purpose or 3. the amount actually spent that is necessary to repair or replace f. DOES NOT APPLY to "increased costs of construction"

additional coverage: Increased cost of construction

additional coverage only applies to buildings with RC increased costs incurred to comply with enforcement of an ordinance or law in the course of repair rebuilding or replacement of damaged parts refers to current ordinance or law will not pay under certain circumstances dow not pay for loss that results from pollutants and or fungus or the costs related to cleanup and testing (this is pollution and debris removal coverage) limited to $10,000 or 5% of the buildings limit of insurance whichever is less. (under $200,000 building is 5%) IN ADDITION TO LIMIT OF INSURANCE

causes of loss-broad form

adds three named causes of loss and the additional coverage-collapse

Limits of Insurance

applicable limit of insurance shown in the dec NOT more than $2500 per sign whether attached or not certain additional coverages have separate limits of insurance Endorsements: Outdoor signs

where do coverage extenstions apply?

apply to property located in or on the building described in the dec or in the open (or in a vehicle) within 100 ft of the described premises

Higher limits endorsement

basically lists a higher limit for whatever additional coverage limit you increase m

Landlord building vacancy def

building is vacant unless at least 31% of its total square footage is rented to a lessee or sublessee and used by the lessee or sublessee to conduct its customary operations; and or used by the building owners to conduct customary operations

Tenant building vacancy definition

building is vacant when it does not contain enough business personal property to conduct customary operations

coinsurance vs 80% insurance to value

coinsurance penalizes the insured in the event of a partial loss, The BOP or homeowners clause uses the same formula for the basis for loss payment, but payment will not be less than the actual cash value

Loss conditions

conditions that apply in addition to the common policy conditions and the commercial property conditions

Coverage extenstions- Valuable Papers and records

cost to replace or restore if duplicates do not exist -NOT if electronic data -Named perils coverage only NOT more than $2,500 Such amount is additional insurance

CE- Newly acquired buildings (2 personal property)

cover extends to newly acquired locations (with exceptions) or for newly constructed or acquired buildings at described location on dec -NOT at fairs, tradeshows or exhibitions -NOT more than $100,000 -NOT property of others in temporary possession

difference between coverage extensions and additional coverages?

coverage extensions has a requirement that you MUST have at least 80% Coinsurance or a value reporting form

CE- Newly Acquired property (period of coverage3)

coverage for newly acquired property will end when any of the following first occurs: a. This policy expires b. 30 days after you acquired or started the construction c. you report values to us

causes of loss-special form

coverage for physucal loss unless excluded burden of proof is on the insurer to show exclude/limited

loss conditions- Vacancy

defines the terms building and vacant that will be used in this condition- one for tenant and one for landlord Buildings are not considered vacant when under construction or renovation

when does Electronic Data additional coverage not apply

does not apply to your "stock" of prepackaged software or to electronic data which is integrated in and operates or controls the buildings elevator, lighting, heating, ventilation, air conditioning, or security system.

CE-Non-Owned Detached Trailers

does not need to be owned by you 1. used in business/in CCC/ Contractual Responsiblity for loss or damage 2. NOT attached to any vehicle 3. NOT during hitching/unhitching/accidentally unhitched 4. NOT more than $5,000 of coverage EXCESS COVERAGE endorsement available: Higher Limits

Preservation of Property

if it is necessary to move covered property from a described premises to prevent further damage by a covered cause of loss we will pay for any direct physical loss or damage to the property while: 1. It is being moved or while temporarily stored at another location 2. Only if the loss or damage occurds within 30 days after the property is first moved DOES NOT INCREASE LIMIT OF INSURANCE

CE- Newly aquired or constructed property (buildings)

if policy covers building you may extend the insurance to apply to a. your new buildings while being built on the described premises b. buildingd you acquire at locations other than the ones on the dec intended for: -similar use as the building described on dec or as a warehouse most paid on this extension is $250,000 per building

Vacancy Provisions

if the building has been vacant for more than 60 consecutive dates coverage excludes 1. vandalism 2. sprinkler leakage 3. building glass breakage 4. water damage 5. theft 6. attempted theft payment reduces by 15% for other covered causes of loss

Increased cost of construction when moving to a new location

if you elect to rebuild at another premises the most we will pay for the increase cost of construction is the increased cost of construction at the same premises (subject to the %5 or $10,000 rule) if the ordinance or law requires relocation to another premises the most that will be paod for ICC is the increase cost of construction at the new premises IN ADDITION TO LIMIT OF INSURANCE

causes of loss- basic form

includes eleven named causes of loss includes the additional coverage- limited coverage for fungus wet rot dry rot and bacteria

loss conditions- loss payment

insurers options 1. pay the value 2. pay the cost of repairing or replacing 3. take the property at an agreed or appraised value 4. repair, rebuild or replace the proeprty with other property of like kind and quality a. the cost does not apply to increased costs of construction b. insurers option expressed within 30 days after receipt of proof of loss c. no more than the named insureds financial interest d. insurer may deal directly with the owners of the property e. insurer may defend named insured at insurers expense f. insurer payment within 30 days if all conditions are followed g. specific provisions for party wall

Optional Coverages- Inflation Guard

limit of insurance increased by the percentage shown in dec -the amount increased changes daily throughout the policy period (pro rata premium charge e.g. 8% annual increase- 4% additional premium)

CE-Outdoor Property

limited property limited perils (FLARE) Not more than $1,000 total ($250 for any one tree, shrub or plant) Coverages include debris removal expense

endorsements available for loss payable provisions

loss payable provision -this endorsment is used to change the loss payment condition to add other persons or organizations to be included in insureres payment of loss or damage used for: -loss payees -lenders loss payees -contract sellers -building owners

what is FLARE?

named perils: Fire Lightning Aircraft Riot or Civil Commotion Explosion

when is debris removal not covered

not covered mproperty deposits of mud or earth extract pollutants from land or water polluted land or water

Deductible

per occurrence AFTER application of COinsurance if more than one item of covered property is damaged and separate limit of insurance apply, losses are not combined in determining application of deductible- but deductible only applied once

coinsurance

policy will not pay the full amount of any loss if the value at the time of loss times the coinsurance percentage shown in the dec is greater than the limit of insurance for the property

Loss conditions- Recovered property

property recovered after loss settlement, that party must notify the other party (between insurer and insured) at your option the property can be returned to you. if property is returned you must return to us the amount we paid to you, we will pay recovery expenses and expenses to repair the recovered property

Example of preservation of property

there is a large wild fire that is reaching an office building, the owner loads all of the computers and furniture onto a truck to move it in order to preserve the property. while driving he gets into an accident and all of the property is ruined, this would be covered because it was in transit.

optional coverages- extension of replacement cost to personal property of others

two actions required for this optional coverage to apply 1. must have replacement cost on named insureds property 2. must "trigger" replacement cost for personal property of others Payment limited to lesser of amount required by contract/ replacement

increased cost of construction will not pay:

until the property is actually repaired or replaced at the same or another premises amd unless the repaire or replacement is made as soon as reasonably possible after the loss or damage, not to exceed two years. (this time frame may be extended in writing by the insurance company)

pollutant clean up and removal additional aggregate limit of insurance endorsement

used mto increase the amount of pollutant cleanup and removal subject to deductible amount, provides and additional aggregate limit Minimum ded of $1000

Loss conditions-appraisal

used to determine value of property or amount of loss can be requested by insurer or named insured outlines selection of appraisers process outlines appraisal process including allocation of costs may be binding but coverage can still be denied

endorsements available for vacancy provisions

vacancy permit -used to waive the vacancy loss condition (allows beyond the 60 day limit) can still exclude vandalism or sprinkler leakage Vacancy Changes -used to change the 31% minimum -all other conditions remain unchanged

when is Debris REmoval covered

when dealing with covered property as well as some other property on the described premises from a covered cause of loss. must be reported within 180 days of the direct physical loss or damage

additional coverages: Pollutant clean up and removal

will pay the expense to extract pollutants from land or water at the described premises if the discharge, dispersal, seepage, migration, release or escape of the "pollutants" is caused by or results from a covered cause of loss. must be reported within 180 days. they will not pay for original testing for pollutants, will only pay for the testing which is performed in the course of extraction of the pollutant from the land or water in one policy period, it will pay $10,000 for the sum of all covered expenses arising out of the covered cause of loss IN ADDITION TO LIMIT OF INSURANCE

Coverage Extenstions- Personal Effects and property of others

you may extend insurance that applies to yourBPP to apply to: 1. personal effects owned by you, your officers, your partners, or members, managers, employees. this does NOT include loss or damage by theft 2. personal property of others in your CCC NOT more than $2,500