Commercial Package Policy (CPP)

Bailee vs Bailor

Bailee: Someone who *receives* the property. Bailor: The party of *owns* the property

Condo Association Coverage Form (Commercial Property Policy CPP)

Covers the buildings, permanent fixtures, and facilities. *Does not* Cover Personal Property owned by the Condo Unit Owner (instead it would be insured under HO-6) Condo unit owners may also purchase *Condo Commercial Unit Owners form* which provides coverage for *business personal property of the insured*. *It does not cover* the building, and it is only used for commercial condos, such as various types of businesses of retail shops.

Spoilage Coverage Endorsement (CPP)

This optional endorsement provides coverage for spoilage of perishable stock *due to power outage, mechanical breakdown, or contamination* This endorsement can be added to Commercial Building and Personal Property form, or Commercial Condo owners form as well.

Peak Season Endorsement (CPP)

Used to increase coverage only temporarily for businesses personal property for businesses that have *seasonal fluctuations*. For example, ski shops during winter have a lot of sales and thus need more insurance coverage. But anytime besides Winter, they don't have a lot of sales so they don't need as much coverage. Peak Season Endorsement may cover the temporary increase for up to *30 or 60 days*

Legal Liability Form (Commercial Property Policy CPP)

Covers property damage to the property of others, *only if the insured is negligent* (Legally liable)

Causes of Loss Form

*Basic*- Named Peril *Broad* - Named Peril *Special* - All Risk

Commercial General Liability Policy (CGL) Coverages

*Coverage A*: BI and PD for Premises Liability, Operations Liability, Product Liability, Completed Operations Liability, Contractual/Assumed Liability. Independent Contractor Coverage: Coverage A for General Contractors, because Contractors may be vicariously liable for the negligent acts of their Sub-contractors and be sued for BI or PD caused by negligent act by a sub-contractor. So Coverage A also covers General Contractor under Independent Contractor Coverage. *Coverage B*: Personal Liability, Advertising Injury Liability *Coverage C*: Medical (No fault, similar to auto and homeowner, to prevent lawsuits, only BI) Supplementary Payments in addition to limits: Defend lawsuits under Coverage A and B, and with the request of the insured pay max $250/day for loss of earnings because insured has to go through court process.

Commercial Building and Personal Property Form (Commercial Property insurance policy; CPP)

*Coverage A*: Covers buildings + Permanently installed equipment (like air conditioning) + Personal property used to maintain or service the building (like fire extinguisher) + Built in Appliances *Coverage B*: Covers business personal property + Business Personal Property Within 100 feet of the described premises. *Coverage C*: Personal Property of others that was left in insured's care, custody or control. *Additional Coverage*: Debris Removal, Removal of business personal property to a place of safety during a covered loss, and it is covered up to *10* days, Up to *$1000* for fire department service charge, *Up to $10,000* for cost of extracting pollutants caused by covered loss. *no stacking coverage* *There is no Coverage for building or business personal property, even though this Form is for Commercial building adn personal property, if you don't actually Name what you want to cover in the Declarations page!*

Business Income Coverage Form/Business Interruption (Commercial Property insurance policy)

*Endorsement form that provides coverage for indirect losses.* This is utilized if the business must *shut down* due to covered loss, and if business shuts down then they will lose business income. This endorsement will cover that income loss. *no deductible* *Only losses incurred during the Period of Restoration is covered* This Endorsement pays the *net profit before Taxes PLUS continuing operating expenses* *Contingent Business Interruption insurance (Business income from Dependent Properties)* is also covered under this endorsement. It covers losses of income incurred by a loss on a Dependent Property that the insured needs in order to stay in business. The coverage applies until the Dependent property is rebuilt.

The Extra Expense Coverage Form (Commercial Property Policy CPP)

*Endorsement* that can be added to CPP that covers indirect loss. This Endorsement is utilized for businesses that *must continue to operate in order to stay in business*. This Endorsement coverage *does not* cover your loss of business income, it covers the extra expense incurred by the business because you had to move to a temporary location to continue business. *no deductible*

Commercial Crime Policy can be written as *loss sustained form* or a *discovery form*

*Loss sustained form* will cover losses that occur during the policy period and are discovered either during the policy period, or 1 year after the policy expires. *Discover form* will cover losses that occur at any time as long as they are discovered either during the policy period of 60 days after policy expires. *These basically determine how long the insured as to turn in a claim*

Commercial Crime Insurance. *Definitions of Crimes*

1. *Burglary*: Taking of property from inside the premises by someone who *forcible enter or exit the premises*. If there is no evidence that a person forcible entered or exited the premises and stole something, it is not covered as Burglary. 2. *Extortion*: The surrender of policy away from the premises because someone threatened the insured that they would harm the insured's relatives, employees or both(who are being captive) if the insured doesn't surrender the property to them. 3. *Robbery*: Taking Property from the care and custody of a person by someone who has caused or threatened to cause bodily harm *So Robbery is literally stealing a property from someone who is handling that property by threatening or harming that person* 4. *Safe Burglary*: Taking of property within a locked safe or a vault by a person who unlawfully and forcibly entered the vault or safe. Also includes removal of safe from the premises. 5.*Theft(Larceny)*: Any act of *stealing*. Theft is a broad coverage. It includes all the more narrowly defined acts of stealing, such as burglary and robbery.

Commercial Inland Marine *Different types of Coverages and Forms*

1.*Accounts Receivable Coverage Form:*Covers sums due to the insured from customers that are uncollectible because accounts receivable records are destroyed . It also covers the expense of reconstructing the accounts-receivable records. 2.*Commercial Articles Coverage Form*: Insures the owner of commercial cameras, projection machines, films, related equipment, including similar property of others that is in insured's care, custody, control. Like if you are shooting a movie and you carry all the movie equipment with you to travel the equipments would be covered under this form. 3.*Equipment Dealers Coverage Form*: Covers the interest of a dealer of mobile equipment, including equipment used primarily for agriculture and construction. *Autos, trucks, motorcycle, boats are not covered* 4.*Jewelers Block Coverage Form* 5.*Installation Floater* 6.*Sign Coverage Form* 7.*Valuable Papers and Records Form* 8.*Bailees Customers Goods Floater* 9.*Contractors Equipment Floater* 10.*Electronic Data Processing Floater*

Commercial Insurance types of Policies

1.*Commercial General Liability* 2.*Commercial Property* 3.*Commercial Crime* 4.*Commercial Inland Marine* 5.*Commercial Auto* 6.*Equipment Breakdown Protection* 7.*Farm Coverages* Any one of these policies can be bought alone as a *monoline* coverage(that is, all by itself), or it can be attached to another policy which then makes it a *Commercial Package Policy (CPP)*

Commercial Crime Insurance *Definitions of People and Places*

1.*Custodian*: The named insured, any of the insured's partners, or any employees, while having care and custody of insured property *inside the premises* Does *not* include any person acting as a janitor or watch person. 2.*Messenger*: Named insured, insured's partners, or any of the employees while having care and custody of insured property *outside the premises* 3.*Premises*: The interior of that portion of any building occupied by the insured for the purpose of conducting business. 4.*Watchperson*: Any person the insured retains to have care and custody of property inside the premises and has no other duties

Commercial Crime Insurance *Different types of Coverages and Forms*

1.*Employee Dishonesty*: A type of *Fidelity Bond* which is insurance that covers businesses from losses caused by dishonest employees. *Does not* provide coverage where the loss can only be proved by inventory computation. Can be written on a *Blanket basis*, covering all employees, on *Per Loss basis or Scheduled Basis* which coverage applies per employee. Scheduled Basis may be written on *Named Schedule Basis* in which each covered employee is named, or on *Position schedule basis* which just the job title is named and anyone holding that job title is covered. 2.*Forgery or Alteration*: Protects insured from losses resulting from *forgery or alteration of outgoing checks* drawn against the insured's account(by third party, not employees), but *not incoming checks*. Losses caused by dishonest or criminal acts of any of insured's employees are not covered. 3.*Theft, Disappearance, and Destruction*: *This is the Broadest/Comprehensive type of Crime coverage*. Covers loss of money and securities inside the premises, or outside the premises *while in the care and custody of a messenger*. Coverage for money and securities outside the premises *while in the custody of an armored-care company*. *All-Risk Crime Insurance* policy. 4.*Inside the Premises-Robbery or Safe Burglary of Other Property*: Covers property other than money and securities against loss or damage due to actual or attempted robbery. It also covers robbery of a custodian inside the premises, damage to the premises resulting from an actual or attempted robbery and safe burglary to property other than money and securities 5.*Premises Burglary*: Covers property *other than money and securities* inside the premises, including loss of covered property by actual or attempted burglary or *robbery of a watch person.* It also covers damages to the premises from a covered burglary or robbery 6.*Computer Fraud*: Covers theft of property, *including money and securities*, directly related to the use of any computer to fraudulently cause a transfer from inside the premises to a person or place outside the premises. The form *does not cover acts of employees or inventory shortages* 7.*Extortion*: Covers Extortion. We learned what Extortion was. *Does not cover for extortion by employees or loss of property surrendered before a reasonable effort is made to report the extortionist's demands to an associate, the FBI and the local police. 8.*Outside the Premises Theft and Robbery*: Covers property *other than money and securities* against theft or robbery *outside the premises*, including robbery of a messenger and loss of or *damage to covered property while in the custody of an armored-car company* 9.*Funds Transfer Fraud*: Covers losses resulting *when a financial institution follows fraudulent instructions to pay money from an insured's account*. However, losses resulting from the use of a computer to fraudulently transfer money or other property is not covered. 10. *Money Orders and Counterfeit Money*: Covers losses when an insured accepts fake money as payment for goods sold or services provided. *These Crime Coverage Forms may be added to the CPP for an additional Premium*

Commercial Inland Marine Insurance *Eligible marine risks*

1.*Imports* - Eligible for *Ocean Marine Insurance* 2.*Exports* - Eligible for *Ocean Marine Insurance* 3.*Domestic Shipments* - Eligible for *Commercial Inland Marine Insurance* 4.*Instrumentalities of Transporattion or Communication* - Eligible for *Commercial Inland Marine Insurance* 5.*Personal Property Floater Risks* - Written in Connection with personal lines of coverage, such as HO policies 6.*Commercial Property Floater Risks* -Eligible for *Commercial Inland Marine Insurance* Commercial Inland Marine policies provide *All-Risk* coverage, covering property anywhere in the world.

Commercial Crime Insurance *Definitions of Property*

1.*Money*: Currency, Coins, bank notes in current use having face value, travelers checks, registered checks, money orders held for sale to the public 2.*Property other than Money and Securities*: Any tangible property other than money and securities that has intrinsic value 3.*Securities*: *Does not* include money. Negotiable and nonnegotiable instruments or contracts representing either money or other property, including tickets, stamps in current use, and evidences of debt in connection with credit or charge cards other than cards issued by the insured.

Commercial Crime insurance Policy

Businesses that fear that people or even their employees might steal their business property may get this form. They can get this form as a Monoline Coverage, or as a CPP with any other form.

Specialized Valuation Endorsement (CPP)

Can be added to any type of Commercial Property insurance forms, except for Builder's Risk form. *When a business has constant fluctuating inventory(Business personal Property), Specialized Valuation Endorsement is added to the Property Policy in order to avoid overinsurance, or underinsurance. * This endorsement allows the *level of coverage to be adjusted* as values change by requiring the insured to *file daily, weekly, monthly, or quarterly Reporting Forms*. For example: Wal-Mart has constant change in inventory because millions of people come in and out of the store with products, and the company is constantly ordering new inventory. So in order to have the correct coverage, they might want to add Specialized Valuation Endorsement in order to prevent overinsurance, or underinsurance.

Basic Causes of Loss Form

Covered Named Perils: Fire, Lightning, Extended Coverage Endorsement/ECE(WHARVVES), vandalism, sprinkler leakage, sinkhole collapse, volcanic actions. *Volcanic Actions*=Loss caused by lava, ash or airborne shock waves. Land shock waves caused by *Volcanic eruption* is *not covered* *Exclusions*: War, flood, loss by Ordinance or Law, earth movement(other than sinkhole collapse), nuclear radiation or reaction

Broad Causes of Loss Form

Covers all perils listed in Basic Causes of Loss Form *Plus* four additional coverages: Glass breakage(limited to $100 per pane and $500 per occurrence.), falling objects, weight of ice, sleet or snow, water damage other than flood.

Cancellation Changes (CPP)

For *Nonpayment of Premium*, the insurer must give *10 days* advanced notice. If the reason for cancel is anything else, the notice should be given even earlier. Most Commercial Property Coverage forms also contain *Cancellation Changes Endorsement*, which allows the insurer to cancel a policy with *5 days* notice for certain reasons such as *vacancy or occupancy for more than 60 days, unsafe premises, failure to repair a covered loss within 30 days, or outstanding tax liens against the property*

Builder's Risk form (Commercial Property Insurance Policy, CPP)

For companies that builds commercial structures. Coverage increases over time because when building a commercial structure, it's not going to be fully completed until some time. *Claims are paid on ACV value, Replacement cost is not available for this form* *Builders Risk Form Coverage automatically gets terminated whenever the insured's builders interest ceases, when the property is sold, or 90 days after construction is completed*, because this form is for commercial buildings under construction.

Commercial Inland Marine Insurance.

Generally written for businesses that have business personal property that is *movable or transportable*, such as equipment dealers, jewelers, and contractors. Usually, claims are adjusted on *ACV* basis, with the exception of *Commercial Fine Arts*, which is settled on *Valued* or *Stated Amount* basis.

If you carry at least 80% Coinsurance for your *Commercial Building and Personal Property Form*, you are granted 5 extension of coverage with *no extra premium* as an *additional amount of insurance above policy limits*

If you purchased *both Coverage A + B*: The form is extended to apply to *newly acquired property*. *Up to 25%* of the Coverage A limit, *up to max of $250,000* for each new building for up to *30 days*. *Up to 10% of Coverage B limit*, up to max of *$250,000* for up to *30 days*. If you purchased *Coverage B*: Extends coverage for *personal property of others* in the insured's care, custody, control up to max of *$2,500* If you purchased *Coverage B:* Also automatic extended coverage for the cost of researching, replacing, restoring the lost information on *valuable papers and records*, including those existing in electronic media, *up to max of $2,500* Extended Coverage also covers *Business Personal Property * that is *temporarily off premises*, up to *max of $10,000* Extended Coverage also extends coverage to cover *outdoor property*, such as fences, antennas, signs that are *not attached to the building*, trees, shrubs, and plants with *max of $1,000*, but *no more than $250 for any one tree, shrub, or plants*

Commercial General Liability Policy (CGL)

Liability for your business. Covers Bodily Injury and Property Damage to others caused by negligent act of the business. Cost of hiring a lawyer (Cost of defense) is in addition to the limit

Ordinance or Law Coverage Endorsement (CPP)

Most property insurance forms exclude loss resulting from Ordinance or Law. If you add this Endorsement, your insurer will pay for the loss of Ordinance or Law. *For example*: You own a really old building. The building gets damaged, and so you need to repair it. However, since times have passed since the building was first built, laws have changed such as buildings are required to have wheelchair lift or certain requirements for the parking lot. If you don't have this Endorsement, the insurer won't pay for the cost of having to rebuild the building with the required terms set by law, because you would have to pay out of pocket for those required my law. *But if you have this Endorsement, the insurer will pay for the loss of money created by Ordinance or Law*

Causes of Loss Forms

Perils covered here are very similar to DP-1, DP-2, DP-3 *Basic*-Named Peril *Broad*-Named *Special*-A/R *Earthquake*

Period of Restoration

Period of Restoration *starts at the date of loss*, *ends when the structure is repaired.*

Glass Coverage Form (CPP)

Provides comprehensive glass coverage for *commercial plate-glass, frames, lettering, and ornamentation* Coverage for glass does not apply if building has been *vacant for more than 60 consecutive days* Usually paid out on *ACV basis*

Special Causes of Loss Form

Since this is All Risk form, anything not excluded is covered. Theft of Business Personal Property is *not* excluded, so it is covered. However, there are special limits for Theft of certain business personal property of *$2,500* for furs, jewelry, watches, and precious stones. *Exclusions*: Wear and tear, mechanical breakdown, insects, rodents, and inherent vice. *Plus* the General exclusions which are : flood, war, earth movement, government actions, nuclear hazard, and ordinance or law.

Earthquake Form (Fourth Causes of Loss Form)

This form must be *added* to one of the three Causes of Loss Form. It can't just stand alone. This adds *two* perils that are excluded in the other causes of loss forms. *Earthquake and Volcanic Eruption* This form can be added with *additional* premium charge. *Any earthquake or volcanic eruption that happened within 168 hour period is considered as a single event* This means even if the policy period ended, if the 168 hour period is not done yet, then coverage for Earthquake or Volcanic eruption is still covered, *as long as the event began during policy period*