Business Personal Property (BPP) is standard coverage offered to businesses and organizations. (iStock) Analysis brought to you by FC&S Expert Coverage Interpretation, the recognized authority on insurance coverage interpretation and analysis for the P&C industry. To find out more — or to learn how to find answers to YOUR coverage questions — click here!
Question: This question involves a building insured for $1,239,000.
A Business Personal Property (BPP) policy is for $100,000. There is a named storm percentage deductible of 3%, with $15,000 minimum per location per attached the named storm deductible endorsement. The building deductible would thus be $37,170.
Damage to the building is approximately $25,000, so the loss does not exceed the deductible. Damage to the BPP is approximately $5,000.
Based on the endorsement language, which states that separate deductibles apply to both the building and personal property, should the deductible for the BPP be $3,000, or the residual of the building deductible?
The insured has a business income loss, as well, under a commercial insurance policy (form CP 00 30 10 12). A 72-hour waiting period applies to it separately from the building deductible, correct?
Thank you.
— Washington, D.C. subscriber
Answer: Since the deductible endorsement clearly states that the deductible applies separately to each building and personal property, the deductible for the BPP will be $3,000, and not the residual of the building deductible. You are correct that the 72-hour waiting deductible for the business income is a separate deductible that applies to that coverage.
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