9.0 Commercial Package Policy & Commercial Property Coverage
Learning Objectives
9.1 Commercial Package Policy (CPP)
A Commercial Package Policy (CPP) allows a business to combine multiple commercial insurance coverages into one policy. This gives the business flexibility to select the coverage parts that best match its property, liability, and operational risks.
9.2 Commercial Property Coverage Part
When a Commercial Package Policy (CPP) includes the Commercial Property Coverage Part, the property coverage is subject to additional conditions that apply specifically to commercial property insurance. In addition, the policy uses standard Causes of Loss forms to identify which perils are covered. A peril is a cause of loss, such as fire, windstorm, theft, or vandalism. The Causes of Loss form is important because it determines whether a particular loss is covered under the Commercial Property Coverage Part.
9.3 Building and Personal Property Coverage Form
Coverage
9.4 Builders Risk Coverage Form
The Builders Risk Coverage Form provides property coverage for buildings or structures while they are under construction. This form is designed to insure construction-related property exposures before the building or structure is completed. Covered property may include:
9.5 Condominium Association Coverage Form
The Condominium Association Coverage Form is used instead of the Building and Personal Property Coverage Form when property is insured in the name of a condominium association. This form provides coverage for property exposures commonly handled by a condominium association. The coverages provided, as well as the categories of property not covered, are generally similar to those found in the Building and Personal Property Coverage Form. The main difference is that this form is specifically designed for condominium association property, rather than property owned or insured by an individual business.
9.6 Condominium Commercial Unit-Owners Coverage Form
The Condominium Commercial Unit-Owners Coverage Form is used to insure commercial condominium unit-owners. It serves as the commercial lines alternative to the personal lines Unit-Owners Homeowners Policy (HO-6). This form provides coverage for the insured unit-owner’s business personal property, such as:
9.7 Legal Liability Coverage Form
The Legal Liability Coverage Form provides coverage for the insured’s legal liability for loss of or damage to property owned by others. Coverage applies when real property or personal property belonging to another person or organization is in the insured’s care, custody, or control and is damaged by a covered cause of loss. This form may also cover the loss of use of the damaged property. In addition, the insurer will provide a legal defense if a covered claim is made against the insured. This coverage is important for businesses that are legally responsible for property they do not own but temporarily control, use, store, repair, or service.
9.8 Business Income and Extra Expense Coverage Forms
Definitions
9.9 Selected Commercial Property Endorsements
Ordinance or Law Coverage
Recap of Chapter Nine
The Commercial Package Policy (CPP) allows a commercial insured to customize an insurance program by selecting the coverage parts that fit the needs of the business. Each CPP is subject to the Common Policy Declarations and the Common Policy Conditions. These components apply to the entire policy, regardless of which coverage parts are included. The Declarations page identifies important policy information, including: