Our consumer is the owner of a flight school that is located at a local airport. He rents a small office in the terminal that requires office liability insurance. The previous tenant gave him the name and number of a company that covered him for $700 per year. When he called the same insurance agency they said they would not insure him because they are a flight school. He reiterated that they were only interested in liability policy to cover the office. That agency, as well as every other one, said they would not cover us because we were a flight school. Again, this was only for liability in the office. Nothing was done in the office but administrative activity. Finally, he had to go to the aviation company that charged 3 times the amount. He says it's a simple office so there should not be an ability of insurance agencies to say they won't cover us just because of our business. Moreover, they should not be able to charge a higher premium. The insurance would not have covered anything outside of the office. Agency's should be required to offer any business a liability policy that covers in the office liability without any determination as to the nature of the business when all that is done there are administrative activities, i.e. paper work.
In review of the BUSINESSOWNERS LIABILITY COVERAGE FORM , it appears that liability would extend beyond the physical office, and this would increase the risk and thus require a higher premium.
Georgia Subscriber
I am not sure what classification is being used to rate the risk. If only the office exposure is being insured, then the classification should be an office classification rather than an educational/aviation classification.
You are correct that the BOP liability provides premises and operations liability for the insured's operations, within the "coverage territory". However there is a way to limit the exposure to only cover the office exposure by attachment of endorsement BP 04 12 04 17 – Limitation of Coverage to Designated Premises, Project or Operations. The endorsement should be expressly and specifically completed to cover only that portion of the office the insured rents and nothing outside that office.
In addition, endorsement BP 04 01 01 06 Comprehensive Business Liability Exclusion (All Hazards In Connection With Designated Premises or Operations) should be expressly and specifically completed to exclude the flight school operations and any and all hazards in connection with the flight school and the airport.