Commercial Property and Commercial Package Policies
The commercial property forms
Building and personal property coverage, condominium forms, and builders risk use the same causes-of-loss forms as personal lines but add business income and extra expense. Key concepts: coinsurance (often 80%, 90%, or 100%), agreed value (suspends coinsurance), and reporting forms. Extensions include newly acquired or constructed property, personal effects and property of others, valuable papers and records, and property off premises.
Business income
Business income covers lost net income plus continuing expenses during the period of restoration, beginning after a short waiting period (commonly 72 hours). Extra expense pays costs to continue operations. Civil authority, dependent property, and extended business income endorsements extend the concept. Payroll may be included or excluded.
Commercial package policy
The CPP combines property and casualty coverage under one policy with common declarations and conditions; coverage parts are selected individually, so a question may describe a package that includes property but not general liability.
Traps
Outdoor signs, fences, and antennas carry sublimits. Foundations and underground pipes get limited coverage. Water damage questions turn on whether the source was a burst pipe or a flood. Vacancy provisions reduce or eliminate recovery after a stated period. Spoilage and equipment breakdown require endorsements.
Rule of thumb: for business income, the coinsurance limit is based on projected income for the 12 months following inception (unless another period is shown), not last year's actual results.