14.0 Miscellaneous Commercial Lines Coverage
Learning Objectives
14.1 Equipment Breakdown Protection Coverage Form
Commercial property insurance covers damage to property, including machinery and equipment, caused by external perils such as fire and lightning. However, it generally excludes losses caused by steam boiler explosions and other internal equipment failures. To fill this gap, Equipment Breakdown insurance—formerly known as Boiler and Machinery insurance—provides coverage for these losses.
14.2 Specialty and Professional Liability Insurance
Some businesses and professionals face specialized liability exposures that are excluded or not covered by standard commercial liability policies, creating coverage gaps. Specialty liability insurance is designed to protect against these unique risks and is written on nonstandard forms with provisions tailored to the insured's specific exposures. Two major categories of specialty insurance are Professional Liability insurance and Management Liability insurance.
14.3 Umbrella and Excess Liability Insurance
Excess Liability insurance provides an additional layer of protection above the limits of an underlying primary liability policy for covered third-party claims. Commercial Umbrella Liability is a type of excess coverage designed to protect against catastrophic losses while often providing broader coverage than the underlying policy. To purchase a Commercial Umbrella or Excess Liability policy, the insured must have primary underlying liability insurance in place.
14.4 NFIP Commercial Coverage
The National Flood Insurance Program (NFIP) defines a flood as the inundation of normally dry land caused by:
14.5 Farm Insurance
Farm and ranch owners face unique risks that require specialized insurance coverage. Modern farms often combine residential and commercial exposures on the same property, making a comprehensive farm policy the most appropriate form of protection. Because of these combined exposures, farm properties are not eligible for coverage under Homeowners or Dwelling policies.
Recap of Chapter Fourteen
Equipment Breakdown Insurance