Commercial Property Insurance – Continued Chapter 10 Business Property Insurance Appendix C Building and Personal Property Coverage Form

Concurrent Causation California court rulings of the 1980s If a loss to property can be attributed to two or more causes, as long as one of the causes is not excluded the loss is covered. Examples Flood and negligent construction of flood control structures (Palm Desert) Landslide and faulty installation of drain

Other Exclusions - Maintenance Wear and tear Rust, corrosion, fungus, decay, deterioration, hidden or latent defect Smog Settling, cracking, shrinking or expansion Insects, birds, rodents, or other animals Mechanical breakdown (except elevator collision) Dampness, dryness, changes or extremes of temperature, and marring or scratching

Other Exclusions - Theft Related Employee dishonesty Voluntary parting Unauthorized instructions Inventory shortage Unexplained disappearance Theft of building materials Dollar Limitations $2500 for furs $2500 for patterns, dies, molds and forms $2500 for jewelry,….gold, silver,.. $250 for stamps, tickets (including lottery tickets held for sale, and letters of credit

Consequential Property Coverage Business Income Coverage Business interruption Net income Continuing normal operating expenses incurred Extra expense Monthly limit of indemnity Maximum period of indemnity Payroll endorsements

Other Property Coverage Commercial Crime Coverage Inland Marine Boiler and Machinery Businessowners Policy

Inland Marine Insurance Development Regulatory restrictions on other coverages Could offer all-risk coverage Less restrictive regulations

Nationwide Marine Definition Imports Exports Domestic shipments Instrumentalities of transportation and communication (bridges, tunnels, piers, power lines, television towers) Various types of individual personal property (jewelry, furs, instruments) Various types of business property (mobile equipment, animals, computers)

General Characteristics of Inland Marine Policies Coverage for property in transit Loss exposures covered Physical loss Business income and extra expense Broad coverage of perils Valuation provisions Actual cash value, replacement cost, selling price, invoice value or agreed value