INS 23 = Commercial Property Insurance, Part 11

Jim's Barber Shop has a Building and Personal Property Coverage Form (BPP) with a $100,000 limit on the building and a $1,000 deductible. The building suffers a $15,000 fire loss. Which one of the following amounts will Jim's insurer pay?

$14,000

Billy owns a baseball souvenir store in Cooperstown, NY. He insured his store under a Building and Personal Property Coverage Form (BPP) with a $275,000 limit and a $1,500 deductible. A large fire in the store caused significant damage amounting to $310,000 in covered damages. How much would Billy's insurer pay under his BPP?

$275,000

Special form offers these advantages to the insured:

- Certain causes of loss that are omitted or excluded under the broad form are not excluded - and are covered - under the special form. Most significantly, the special form covers theft of covered property under a wide variety of circumstances, subject to some exclusions and limitations. Basic & Broad forms cover theft by looting at the time of a riot or civil commotion, but in no other circumstances - By covering direct physical loses other than those that are specifically excluded, the special form covers losses that the insured might not have anticipated - The special form shifts the "Burden of proof" from the insured to the insurer. Under a named perils form, such as the basic or broad form, the insured must prove that the loss was caused by a covered cause. Under special form, an accidental loss to covered property is presumed to be covered unless the insurer can prove that it was caused by an excluded peril

Six Additional Coverages in the BPP

- Debris removal - Preservation of property - Fire department service charge - Pollutant cleanup and removal - Increased cost of construction - Electronic data

All of the following are Special Form coverage extensions that insure certain losses not otherwise covered

- Property in Transit - Glass - Water Damage, Other Liquids, Powder or Molten Material Damage

Special form exclusion of causes of loss to trees, shrubs, palnts or lawns that are part of a vegetated roof:

- dampness or dryness of atmosphere or of soil supporting the vegetation - Changes in or extremes of temperature - Disease - Frost or hail - rain, snow, ice or sleet

THe following loss to these kinds of property under special form is covered only if it is causwed by specified causes of loss:

- valuable papers and records - animals, and then only in the event of their death - fragile articles if broken, such as glassware, statuary, marble, chinaware, and porcelain (but not including building glass and containers of property held for sale) - Builder's machinery and equipment owned or held by the insured unless on or within 100 feet of the described premises

Special form excludes loss caused by these:

- weather conditions that contribute to other excluded causes of loss... flood waters caused by high winds, flood waters not covered - Acts or decisions, including failure to act or decide, of any person, group, organization, or governmental body. If flooding occurs because municipal authorities fail to take proper flood control measures, the flood exclusion cannot be overcome by the insured's claim that the municipality's failure to act was the cause of loss - Faulty or inadequate planning, zoning, surveying, siting, design, specifications, workmanship, repair, construction, renovation, remodeling, grading, compaction, materials, or maintenance

The owners of Uncle Reggie's Steakhouse are insured under a Building and Personal Property Coverage Form (BPP) that covers their building and business personal property for $350,000 and $100,000, respectively. The policy has a $2,500 deductible. A fire results in $350,000 worth of damage to the building and a $70,000 loss of business personal property. In what amounts should the policy provide coverage for this loss?

. $347,500 Building and $70,000 Property

Vandalism losses will not be paid if the building has been vacant for how many consecutive days?

60

Proof of loss

A statement of facts about a loss for which the insured is making a claim.

The cost to replace property with new property of like kind and quality less depreciation is referred to as the

Actual cash value.

Deductible

An insurer is not obligated to pay anything to the insured unless the loss exceeds the deductible shown in the policy declarations. The limit of insurance then applies to the loss in excess of the deductible.

Coverage Extensions

Apply only if at least 80 percent coinsurance or a value reporting period symbol is shown in the decs. The amounts payable under the coverage extensions are payable in addition to the overall limits of insurance stated in the decs, subject to the special limits that apply to the coverage extensions. Coverage extensions: - Newly acquired or constructed property - Personal effects and property of others - Valuable papers and records (other than electronic data) - Property off-premises - Outdoor property - Non-owned detached trailers - Business personal property temporarily in portable storage units

The condition of the Building and Personal Property Coverage Form (BPP) that establishes a method for the insurer and the insured to resolve disputes about the insured property's value or amount of loss is referred to as the

Appraisal condition.

Additional coverages - basic and broad form

Basic and broad - fungus $15,000 broad - collapse of a building caused by: any covered loss, hidden decay, hidden insect/vermin damage, weight of people or personal prop, weight of rain that collects on roof, use of defective materials or construction methods if the abrupt collapse occurs during construction

Basic & Broad form - covered causes of losses

Basic: Fire lightning explosion windstorm or hail smoke aircraft or vehicles riot or civil commotion vandalism sprinkler leakage sinkhole collapse volcanic action Broad form only: Falling objects weight of ice, snow or sleet water damage

Book Question: Which one of the following is covered under the Building and Personal Property Coverage Form (BPP) as business personal property?

Building contents such as furniture

book question: The commercial property policy Causes of Loss Form that provides coverage for "risks of direct physical loss," unless excluded or limited by the policy is called the

Causes of Loss—Special Form.

Exclusions and limitations of special form

Contains most of the exclusions of basic & broad forms, including (but not all) of the limitations expressed in the descriptions of the basic and broad covered causes of loss. In those instances in which the special form does not contain an exclusion or limitation equivalent to any of those contained in the basic and broad forms, it provides broader coverage

Actual cash value (ACV)

Cost to replace property with new property of like kind and quality less depreciation.

Business personal property temporarily in portable storage units

Could include either a unit specifically designed for this purpose or a detached trailer or semitrailer. The unit must be located within 100 feet of the building or structure insured or within 100 feet of insured premises - whichever is greater. Truly temporary storage - coverage ends ninety days after the property is placed in the unit. No longer applies if unit has been in use >90 days. Unless a higher limit is shown in dec $10,000 is the max an insurer will pay for the business personal property under the extension regardless number of units

Earth Movement

Coverage is not provided for damage caused by earth movement other than sinkhole collapse.

Personal Property of others

Coverage protects the insured against loss or damage to the personal property of others while such property is in the custody of the insured. Covers property only while it is in the insured's care, custody, or control and in or on the building described in the decs or within 100 feet of the building structure/premises

Outdoor property

Covers loss to outdoor fences, radio & television antennas (including satellite dishes), and trees, shrubs, and plants in most instances. Has its own list of covered causes of loos: fire, lightning, explosion, riot or civil commotion, and aircraft. Does NOT cover - windstorm, vehicles, and vandalism

Book question: Which one of the following perils would be covered under the commercial property broad form but not covered under the basic form?

Damage due to weight of snow

Which one of the following statements is correct with respect to the Building and Personal Property Coverage Form (BPP)?

Due to coverage extensions, it is possible for the total payment for one loss to exceed the policy limit.

special form and theft

Excludes dishonest and criminal acts (including theft) of the insured or of partners, members, officers, managers, directors, or employees of the insured, but the exclusion doesn't apply to acts of destruction by employees.

Book question: WHich one of the following statements is correct with respect to the covered causes of loss under the causes of loss - basic form?

Explosion includes the explosion of gases or fuel in a furnace or flue

Recovered Property

If either the insurer or the insured recovers property, such as stolen merchandise, for which the insurer has paid a loss, the party that makes the recovery is obligated to promptly notify the other party. The insured has the option of taking the recovered property and refunding the loss payment to the insurer. The insurer would then pay the cost of recovering the property and the cost, if any, of repairing it. If the insured elects not to take the recovered property, the insurer may dispose of the property as it sees fit.

Loss Payment

If loss or damage is covered, the insurer has four loss payment options: -Pay the amount of the loss or damage - Pay the cost of repairing or replacing the damaged property (does not include any increased cost attributable to enforcement of ordinances or laws regulating the construction, use, or repair of the property) - Take over all or any part of the property and pay its agreed or appraised value - Repair, rebuild, or replace the damaged property with other property of like kind and quality

Vacancy

If the building where a loss occurs has been vacant for more than sixty consecutive days before the loss occurs, the insurer will not pay if the loss is caused by vandalism, sprinkler leakage (unless the sprinkler system was protected against freezing), breakage of building glass, water damage, theft, or attempted theft. If any other covered peril causes the loss, loss payment will be reduced by 15 percent.

Newly acquired or constructed property

If the policy covers a building, the newly acquired or constructed property extension provides automatic coverage for a new building being constructed at the premises described in the decs. Also provided for newly acquired buildings at other locations as long as the usage is the same or used as a warehouse. The coverage extension states a max amount of coverage for each building If the policy covers business personal property, the extension also provides automatic coverage for these types of property: - Business Personal property at any newly acquired location other than fairs, trade shows, or exhibitions - Business personal property located at newly constructed buildings at the location described in the decs * A stated amount of coverage applies to loss of business personal property at each building This is temporary coverage, automatically terminates at the earliest of three dates: - The expiration date of the policy - Thirty days after the acquisition of the new location or the start of construction of the new building - The date the insured notifies the insurer of the new location or new building

The owners of a restaurant are insured under a BPP coverage form that covers their building for a $400,000 limit and their business personal property for a $200,000 limit. The policy has a $1,000 deductible. A covered cause of loss results in $100,000 worth of damage to the building and a $50,000 loss of business personal property. Assuming that no coinsurance penalty applies, apply the policy's limits and deductible to this loss to determine the amount payable.

In accordance with the Deductible provision, the $1,000 deductible is subtracted from the building loss before applying the building limit: $100,000 - $1,000 = $99,000. Because this amount is less than the $400,000 building limit, the insurer will pay $99,000 for the building loss. Because the deductible applies only once per occurrence and has already been applied to the building loss, it does not apply to the business personal property loss. Moreover, the business personal property loss does not exceed the applicable $200,000 limit. Therefore, the insurer will pay the $50,000 business personal property loss in full. The insurer's total payment will be calculated as $99,000 + $50,000 = $149,000.

Book Question: Under which one of the following provisions of the Building and personal property coverage form (BPP) is the maximum payment $10,000 or fivef percent of the building limit, whichever is less?

Increased cost of construction additional coverage

Exclusions/Anti-Concurrent Causation Wording

Introductory language to the first group of 8 exclusions provides that losses caused directly by an of those perils are not covered, even if another covered loss contributed to the loss, regardless of the sequence in which the causes of events occur, unless the exclusion specifically provides otherwise The concurrent causation doctrine holds that a loss is covered when caused by two or more independent, concurrent perils if only one of the perils is covered - even if the peril or perils are clearly excluded

Preservation of property

It is sometimes necessary to move covered property to another location to protect it. The additional coverage extends the policy to protect covered property while it is being moved and for up to thirty days at the new location. Broader than normal coverage under the policy - protects against "any direct physical loss or damage" and is not limited to either the covered causes of loss or locations stipulated in the coverage form

All of these statements are true about how a deductible applies after a loss, EXCEPT:

It is subtracted from the limit of insurance.

Book Question: With respect to the non-owned detached trailers coverage extension of the Building and Personal Property Coverage Form (BPP), which statement is correct?

It permits the insured to extend "your business personal property" to include trailers to expand office space or to provide additional storage or work areas

Book Question: Which one of the following statements is correct with respect to the preservation of property additional coverage of the building and personal property coverage form (BPP)?

It protects against "any direct physical loss or damage" and is not limited to either the covered causes of loss or locations stipulated in the coverage form

Book Question: Which of the following is correct with respect to the Increased Cost of Construction additional coverage of the Building and Personal Property Coverage Form (BPP)?

It provides a small amount of insurance to cover the increased cost to comply with ordinances or laws regulating the repair, rebuilding or replacement of covered buildings

book question: The Causes of Loss—Special Form is a commercial property form that covers causes of loss that are not specifically excluded. One reason to purchase this form is

It shifts the burden of proof to the insurer to prove a loss is excluded.

BPP's Property Not Covered section

Lists several classes of property losses that do not qualify as covered property. - Some kinds of property, such as smuggled goods being held for sale, are illegal to insure. - Some property may be much less susceptible to loss by most of the perils insured against. Examples: building foundations below the lowest basement floor or the surface of the ground, retaining walls that are not part of a building, and underground pipes. - Some kinds of property are excluded because they can be insured more advantageously under other forms. Example: insurers generally prefer to cover money, securities, automobiles and aircraft under other policies. Endorsements can make available coverage for almost all of the items listed in the Property Not Covered section. Only contraband or property in the course of illegal transportation or trade is totally uninsurable

Nuclear Hazard

Loss caused by nuclear reaction, radiation, or radioactive contamination is excluded. However, the exclusion does not apply to loss by fire resulting from these causes.

An exclusion contained in the causes of loss - basic form eliminates coverage for damage caused by which one of the following?

Mechanical breakdown, including rupture or bursting by centrifugal force

Stock

Merchandise held in storage or for sale, raw materials and in-process or finished goods, including supplies used in their packing or shipping. Your business property also includes labor, materials, or services furnished by the insured on personal property of others

A soft-drink producer is insured under the Building and Personal Property Coverage Form, also referred to as the BPP, with Special Form coverage. A mistake during the production process for one of its diet sodas causes too much artificial sweetener to be added to a large quantity of the beverage, forcing the soft drink producer to dispose of the entire batch. Would the cause of this loss be covered under the soft-drink producer's Special Form?

No, the cause of the loss would not be covered under the soft-drink producer's Special Form, because the Loss or Damage to Products exclusion eliminates coverage for damage to merchandise, goods, or other products resulting from production errors, such as adding wrong ingredients or measuring ingredients incorrectly

Book Question: Which one of the following statements is correct with respect to Property Not Covered under the Building and Personal Coverage Form (BPP)?

Only contraband or property in the course of illegal transportation or trade is totally uninsurable by endorsement or in the other policies

Increased cost of construction

Ordinance or law exclusion contained in the causesof loss forms that can be attached to the BPP excludes the increased cost to comply with ordinaances or laws regulating repair, rebuilding or replacement of covered buildings. The increased cost of construction additional coverage provides a small amount of ins to cover this loss exposure. 5 percent of the amount of ins or $10,000 - whichever is less, paid in addition to the policy limit. Applies only if replacement cost optional coverage has been selected. The increased cost of construction additional coverage provides no coverage for these items: - Loss to any undamaged portion of the building that an ordinance or law does not permit to remain in use - The cost to demolish the undamaged portion of the structure and remove its debris

Book Question: Under the building and personal property coverage form (BPP), which one of the following extensions covers loss by fire, lightning, explosion, riot or civil commotion and aircraft?

Outdoor property

Book Question: Which one of the following statements is correct with respect to the building coverage provided by the Building and Personal Property Coverage Form (BPP)?

Personal property owned by the insured and used to maintain or service the building or its premises is included in the BPP's definition of "building"

Special form - additional coverages and extensions

Property in transit - provides up to $5000 in additional protection for loss to the insured's property in transit. Must be in a motor vehicle owned, leased or operated by insured and cannot be in custody of insured's sales personnel. restricted covered perils Water damage, other liquids, powder or molten material damage - covers cost to tear out and replace any part of the building necessary to repair an applicance or a system from which water or another liquid - even powder fire-extinguishing agents or molten materials - has escaped. Does not repair any defect that resulted in leakage Glass extension covers the expenses of installing temporary glass plates or boarding up openings when repair or replacement of damaged glass has been delayed. THe insurer will also pay for the cost of clear obstructions that prevent replacement of the glass

Governmental Action

Seizure or destruction of property by governmental action is not covered. Exclusion does not apply to the destruction of property by governmental order to stop the spread of a covered fire

Book Question: Which one of the statements is correct with respect to the Building and Personal Property Coverage Form (BPP)?

Some property, such as building foundations below the lowest basement floor, is excluded because it may not be subject to loss by the perils insured against.

Examples of perils the special form specifically excludes:

Special form covers all risks except those that are specifically excluded: - wear and tear - rust, corrosion, decay, deterioration, or hidden or latent defects - smog - infestations and waste products of insects, birds, rodents, or other animals - mechanical breakdown - dampness or dryness of atmosphere, changes or extremes in temperatures, or marring or scratching (applicable to personal property only)

Book Question: "Merchandise held in storage or for sale, raw materials and in-process or finished goods, including supplies used in their packaging or shipping" is the Building and Personal Property Coverage Form's (BPP) definition for which one of the following?

Stock

Which one of the following statements is correct with respect to the Valuation condition of the Building and Personal Property Coverage Form (BPP)?

Subject to certain exceptions, insured property is valued at its actual cash value (ACV).

Book question: The cause of loss - basic form differs from the causes of loss- broad form in which one of the following ways?

THe broad form provides coverage for loss caused by collapse of a building or personal property resulting from specified perils.

A business office is insured under a BPP coverage form that specifies a $2 million limit of insurance on the office building and a $900,000 limit of insurance on business personal property at the building's address. The policy has a $5,000 deductible. A covered cause of loss results in $2.2 million worth of damage to the building and a $300,000 loss of business personal property. Two shrubs are destroyed, resulting in a $500 loss fully covered by the BPP coverage form's Outdoor Property coverage extension.Assuming that no coinsurance penalty applies, apply the policy's limits and deductible to this loss to determine the amount payable.

The $5,000 deductible is subtracted from the amount of the building loss before applying the building limit: $2,200,000 - $5,000 = $2,195,000. Because this amount exceeds the applicable limit of insurance, the insurer will pay the full $2 million limit of insurance for the building loss. The deductible applies only once per occurrence and has already been applied to the building loss; therefore, it does not apply to the business personal property loss. Moreover, because the business personal property loss does not exceed the applicable $900,000 limit of insurance, the insurer will pay the $300,000 business personal property loss in full. Finally, the $500 payment for the shrubs under the Outdoor Property coverage extension is payable in addition to the limits of insurance. Therefore, the insurer will pay a total of $2,300,500, calculated as $2,000,000 + $300,000 + $500.

book question: Under which one of the following causes of loss forms is the burden of proof on the insurer to prove why coverage does not apply?

The Causes of Loss—Special Form

Coinsurance

The Coinsurance condition requires the insured to carry insurance equal to at least a specified percentage of the covered property's ACV (or replacement cost, if that optional valuation approach is in effect).

Book Question: Which BPP components provides a small amount of insurance to cover the increased cost to comply with ordinances or laws regulating the repair, rebuilding or replacement of covered buildings?

The Increased Cost of Construction additional coverage

book question: Which one of the following statements best describes the Causes of Loss—Special Form?

The Special Form provides coverage for direct physical losses other than those that are specifically excluded

Valuation

The Valuation condition sets forth rules for establishing the value of insured property. Subject to the exceptions summarized in the exhibit, the insured property is valued at its actual cash value (ACV). ACV valuation can be changed to replacement cost valuation by activating the BPP's optional coverages for replacement cost, which are printed in the BPP.

Book question: Which one of the following would be covered under the commercial property policy causese of loss - broad form additional coverage for collapse?

The abrupt falling down of part of the insured's building

Which one of the following is correct with respect to the Vacancy condition of the Building and Personal Property Coverage Form (BPP)?

The conditions under which a building is considered to be vacant are different for a tenant than for an owner.

Which one of the following statements is correct with respect to the Mortgageholder condition of the Building and Personal Property Coverage Form (BPP)?

The insurer is sometimes obligated to make a loss payment to the mortgageholder even though it has denied coverage, for example, to an insured who has committed arson.

BPP Covered Property

The main insuring agreement of the Building & Personal Property Coverage Form (BPP) states that the insurer will pay for direct physical loss of or damage to Covered Property at the described premises caused by or resulting from any Covered Cause of Loss. The BPP can cover any combination of three bread categories of property: - Building - Your Business Personal Property - Personal Property of Others

book question: The Causes of Loss—Special Form provides coverage for which one of the following scenarios?

The melting ice, sleet, or snow on the building or structure

Causes of loss - Special form

The most frequently selected of the three causes of loss forms, the Causes of Loss—Special Form is designed to cover any loss that would be covered by the Basic and Broad Forms. In addition, the Special Form provides coverages not found in the Basic and Broad Forms. The Special Form offers several advantages to the insured, including coverage for certain causes of loss that are omitted or excluded under the Broad Form, coverage for losses the insured might not have anticipated, and the placement of the "burden of proof" on the insurer as opposed to the insured.

Building

The policy covers buildings or structures listed and described in the declarations. - Completed additions to covered buildings - Fixtures (including outdoor fixtures) - Permanently installed machinery and equipment - Personal property owned by the insured and used to maintain or service the building or its premises (examples: fire extinguishing equipment, outdoor furniture, floor coverings, equipment for refrigeration, ventilation, cooking, dishwashing, and laundering)

book question: Which one of the following statements is correct with regard to the Causes of loss -broad form?

The weight of snow, ice or sleet cause of loss does not cover damage to personal property in the open

Book question: WHich one of the following best describes coverage for crime losses under the commercial property policy causes of loss - basic form?

There is coverage for building damage caused by burglars breaking in or exiting the insured's property

Ordinance or law

To promote public welfare and safety, municipalities enact and regularly upgrade the building codes that set the standards for new construction or significant remodeling

ISO BPP Insurer obligated to pay

Under the ISO BPP, the most the insurer is obligated to pay for loss in any one occurrence is the applicable limit of insurance shown in the declarations. The insurer is not obligated to pay anything to the insured unless the loss exceeds the deductible; the limit of insurance then applies to the loss in excess of the deductible.

Duties in the Event of Loss or Damage

When a loss occurs, the insured must take several actions: - Notify the police if the loss appears to have resulted from a violation of law, such as vandalism, arson, or theft. -Give the insurer prompt notice of the loss, including a description of the property damaged. Prompt notice is generally held to mean as soon as feasible under the circumstances. - Provide information as to how, when, and where the loss occurred. Take all reasonable steps to protect the property from further loss. -At the insurer's request, furnish the insurer with inventories of the damaged and undamaged property and permit the insurer to inspect the property and records. - Submit to examination under oath regarding any matter related to the loss. -Cooperate with the insurer in the adjustment of the loss. Send a signed, sworn proof of loss to the insurer within sixty days after the insurer's request for one.

Deductible provision

When the occurrence involves loss to more than one item of Covered Property and separate Limits of Insurance apply, the losses will not be combined in determining application of the Deductible. But the deductible will be applied only once per occurrence.

An office building is insured under the BPP with Special Form coverage. Firefighters' efforts to extinguish a fire caused extensive water damage to the insured building. In addition, several windows were broken by the intense heat of the fire. Would the cause of these losses be covered under the Special Form? Additionally, would the Special Form cover the cost of boarding up the windows?

Yes, the Special Form would cover the cause of this loss, which was fire, because the Special Form does not exclude fire or any of the consequences of the fire.

Book Question: Coverage for improvements and betterments is provided under which type of property on the Building and Personal Property Coverage Form?

Your Business Personal Property

Business Personal Property

covers personal property owned by the insured and used in the insured's business. Except far and extension that provides limited coverage for property while away from the insured premises, coverage applies only when the property is located in or on the described Building or in the open (or in a vehicle) within 100 feet of the building or structure within 100 feet of the described premises, whichever distance is greater. Includes: furniture and fixtures, machinery and equipment, stock and all other personal property owned by the insured and used in the insured's business, except those items excluded under the Property Not Covered section

Causes of loss - special form

direct physical loss unless the loss is excluded or limited in the policy. Loss or damage must be accidental and unforseen by the insured in order to be covered

water

eliminates coverage for damage caused by - flood, surface water, tides, waves (including tidal wave and tsunami), tides, tidal water, overflow of a body of water, or spray from any of these - Mudslide or mudflow - backing up of sewers, drains, or sumps - Underground water pressing on or flowing or seeping through foundations, walls, floors, basements, doors, windows, or other openings

war and military action

eliminates coverage for loss caused by war, revolution, insurrection or similar actions.

The Appraisal condition

establishes a method for the insurer and the insured to resolve disputes about the insured property's value or amount of loss. It does not apply to policy coverage disputes. If the insured and the insurer cannot agree on the value of the property or the amount of loss, either party may issue a written demand for an appraisal. When either party demands an appraisal, the appraisal process described in the BPP must be followed.

Utility Services

loss caused by power failure or failure of another utility service is excluded if the failure originates away from the described premises.

Fungus , wet rot, dry rot and bacteria

mold or mildew by any mycotoxins, spores, scents or by-products produced or released by fungi

Exclusions of Basic & Broad form perils

ordinance or law Earth movement Governmental action nuclear hazard Utility services War & military action water "Fungus" wet rot, dry rot, and bacteria Other exclusions that are not subject to the anti-concurrent causation wording. These exclusions eliminate coverage for loss or damage by any of these: - Electrical, magnetic, or electromagnetic energy that damages or otherwise interferes with any electrical or electrical wires or devices - Rupture or bursting of water pipes, unless caused by a covered cause of loss. The exclusion does not apply to sprinkler leakage and is included only in the basic form - Leakage of water or stream from any part of an appliance or system containing water or steam (other than an automatic sprinkler system), unless caused by a covered cause of loss - Explosion of steam boilers, steam pipes, steam turbines, or steam engines owned by, leased to, or operated by the insured. However, if such an explosion causes a fire or combustion explosion, the damage caused by fire or combustion explosion is covered - Mechanical breakdown, including rupture or or bursting caused by centrifugal force - Loss resulting from the neglect of the isnured to use all reasonable means to save and preserve property at and after the time of loss

The Abandonment condition

prohibits the insured from abandoning damaged property to the insurer for repair or disposal. Although the Loss Payment condition permits the insurer, at its option, to take all or any part of damaged property at an agreed or appraised value, the Abandonment condition clarifies that making arrangements for the repair or disposal of covered property is the insured's responsibility, unless the insurer chooses to exercise its option under the Loss Payment condition.

Personal Effects and property of others

provides a limited amount of coverage for personal effects (such as a coat or jewelry) owned by an individual insured or a partner, a member, an officer, a manager, an employee of the insured while on the premises described in the decs. Personal effects are not covered by loss of theft. Also covers property in the care, custody or control of insured

Book question: Which one of the following losses would be considered covered water damage under the commercial property policy causes of loss - broad from?

sudden and accidental discharge of water from the breaking apart of an insured's water pipe

The Loss Conditions and Additional Conditions sections of the BPP states:

the duties of the insured and the insurer after a loss has occurred, establish procedures for adjusting claims, explain methods for establishing the value of damaged property, outline requirements for coinsurance, and explain the interests of a mortgageholder (mortgagee).

Non-owned detached trailers

used to expand office space or provide additional storage or work areas at their own premises. Trailer must be used in the insured's business and be in the insured's care, custody or control at the described premises. Insured must have a contractual responsibility to pay for loss or damage to the trailer Does not apply while the trailer is attached to any motor vehicle or motorized conveyance, whether or not in motion. Does not apply during hitching or unhitching operations or when a trailer becomes accidentally unhitched from a motor vehicle or conveyance

Book question: Which one of the following is one of the covered causes of loss in the commercial property policy causes of loss - basic form?

vandalism

Book question: WHich one of the following is a covered cause of loss under the cuases of loss - basic form?

volcanic action

Sizemore Industries has a Building and Personal Property Coverage Form (BPP) that covers four buildings at one location. Each building is insured for a separate limit of $150,000, and a $5,000 deductible applies. A windstorm causes $4,000 worth of damage to each of the buildings for a combined total of $16,000 of damage. How much will the insurer pay for Sizemore's losses to its buildings?

$0