Commercial Package Policy
Structure
The commercial package policy combines at least two coverage parts under one policy: commercial property, commercial general liability, commercial auto, crime, inland marine, boiler and machinery, farm, or liquor liability. Common declarations, common conditions, and interline endorsements sit on top, while each coverage part keeps its own insuring agreement, exclusions, and limits.
Commercial general liability
Coverage A is bodily injury and property damage; Coverage B is personal and advertising injury; Coverage C is medical payments. Five limits apply: each occurrence, general aggregate, products-completed operations aggregate, personal and advertising injury, and damage to premises rented to you. Defense costs are paid outside the limits. Key exclusions include expected or intentional injury, contractual liability (except insured contracts), employer's liability, pollution, your product, your work, impaired property, and professional services.
Trigger
Occurrence forms respond to injury or damage during the policy period. Claims-made forms respond to claims first made during the period, limited by a retroactive date and extended reporting periods.
Commercial property
Coinsurance at 80, 90, or 100%; agreed value; blanket versus specific limits; business income with a period of restoration and a 72-hour waiting period; extra expense; extended period of indemnity.
Trap: assuming the CGL pays to redo the insured's own defective work, or confusing the products-completed operations aggregate with the general aggregate.
Worked example: a $1,000,000 occurrence and $2,000,000 general aggregate CGL. Three separate $700,000 claims arise in one policy year; the third claim is limited to the $600,000 remaining in the aggregate.