The insured had a wine leakage loss that we are covering under the LEAKAGE COVERAGE _ BUSINESS PERSONAL PROPERTY under the CP-358W Endorsement. The leak was due to faulty corks and we agreed to cover it under b. Errors or omissions in the workmanship of "you" or "your" employee(s). The coverage has a limit of $25,000 unless a higher amount is shown on the declarations. (page 2 of the attached form). Our company does not offer any endorsement for additional coverage for leakage under this provision.
The agent is arguing that the policy limit for BBP on the policy dec page should apply because it is the "higher limit shown on the declarations". The dec page has $410,400 for BPP.
I tried to explain that this is the limit for all his BPP and not just the wine that leaked. Can you shed some insight on this and what the limit should be?
Virginia Subscriber
The limit on the declarations for business personal property applies to the entirety of the business personal property exposure. As an enhancement, endorsement CP 358W 0310 permits part of that BPP limit to be applied to winery products. Endorsements supersede coverages and/or limits that would otherwise be provided under the policy. As such, the limit of $25,000 on the endorsement supercedes the business personal property limit but only with respect to the coverages provided under the Winery endorsement.
We do not have access to the declarations, but the endorsement refers to a maximum of $25,000 for the wine leakage unless a higher limit is shown on the declarations. This means that the coverage referred to under the endorsement would need to be a higher limit, not the BPP limit as that limit has been superseded by the endorsement.