Commercial Property Basics
What is the main purpose of Commercial property insurance?
To protect a business's physical assets against damage or loss.
What does Commercial General Liability insurance primarily protect against?
Claims of bodily injury, property damage, or personal/advertising injury caused by business operations.
What does a Business Auto Policy (BAP) cover?
Covers liability and physical damage for vehicles used in business.
What does Workers' Compensation insurance cover?
Medical expenses and lost wages for work-related injuries or illnesses.
What is a deductible?
The amount the insured must pay out of pocket before insurance coverage applies.
Name two types of property commonly covered under commercial property insurance.
Buildings, inventory, equipment, furniture, signs, and fixtures.
Name two common exposures covered by CGL.
Slip and fall claims, product liability, advertising injury.
What are "hired and non-owned" auto exposures?
Vehicles a business rents or employees' personal vehicles used for business purposes.
Is Workers' Compensation coverage mandatory in most states?
Yes
What does "endorsement" mean in insurance?
A policy addition that changes coverage terms.
What is the difference between "Replacement Cost" and "Actual Cash Value"?
Replacement cost pays to replace property with new items; Actual Cash Value pays replacement minus depreciation.
What coverage form part protects against bodily injury and property damage?
Coverage A - Bodily injury and property damage liability
What is Symbol 1 in a BAP?
"Any Auto" - Provides the broadest liability coverage.
What is an Experience Modification Factor (EMOD?
A factor that adjusts premium based on a business claims history.
What is a Peril?
A cause of loss (like fire, theft, windstorm).
What is a Business Income Coverage endorsement for?
To cover loss of business income when operations are suspended due to a covered loss.
What is a "Products and Completed Operations" exposure?
Liability for injury/damage caused by products after they leave your premises or from completed work.
What's typically covered under comprehensive physical damage coverage?
Theft, vandalism, fire, hail, and other non-collision damage.
Name two types of benefits provided by Workers' Compensation.
Medical benefits, wage replacement, rehabilitation, death benefits.
What does "aggregate limit" mean?
The maximum he insurer will pay for all covered losses during a policy period.
True or False: Flood is typically covered under a standard commercial property policy.
False - Flood requires a separate policy.
Name a liability that is typically excluded from CGL policies.
Professional Liability (errors & omissions), Auto Liability and Workers' Compensation.
Can personal vehicles used for business be covered under a BAP?
Yes, with hired & non-owned auto endorsement.
Who determines Workers' Compensation rates in most states?
State rating bureaus or the National Council on Compensation Insurance (NCCI).
Define "Named Perils" vs "Open Perils" coverage.
Named perils cover only specific risks listed in the policy. Open perils cover all risks except those specifically excluded.