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Commercial Insurance FAQ
The answers to coverage questions are primarily based on ISO forms generally used in Florida by most companies. However, we must keep in mind that all companies’ forms are NOT necessarily the same. Some companies may provide broader coverage and some may be more restrictive. IN ALL CASES, THE CONSUMER MUST REFER TO HIS OR HER OWN POLICY FOR SPECIFIC COVERAGE INFORMATION.
In catastrophic situations, some companies may be more lenient in their handling of claims and may make concessions, such as advancing additional living expense (i.e. ALE) payments, to expedite the claim process. Other companies may handle such claims in accordance with their normal procedures.
If you have additional questions that need to be added to this list or if you find any errors, please send them to the Division of Consumer Services, Bureau of Education, Advocacy and Research, 200 East Gaines Street, Tallahassee, Florida 32399-4212.
Are outside plate glass windows covered on a commercial building?

If a comprehensive glass insurance policy/endorsement was purchased they are covered. However, there may be certain conditions which must be met for coverage to apply. Such as, a requirement to have hurricane shutters or the use of a specific grade of plywood to cover them at specified times.

Will the debris removal coverage on a Condo Association’s policy pay the cost to remove debris from their pool?

If the debris did not cause damage to covered property, no. The expense to clean out the pool is not covered.

Is there wind coverage for the inventory of new/used vehicles located at a dealership? Also, if employee’s vehicles are located on the lot during a windstorm are they covered by the dealerships policy?

An auto dealer’s physical damage policy would provide coverage for the new cars if comprehensive or combined additional coverage (CAC- comprehensive coverage excluding theft) was included in the policy. (Sometimes, the manufacturers provide coverage for the new cars.) The used cars would be covered only if coverage was included in the policy for an additional premium. The damage to employees’ vehicles is covered by their own comprehensive insurance coverage. If they did not purchase physical damage on their own policy, they would not have coverage.

Is a satellite dish providing service to hotel rooms covered if damaged by a windstorm?

Yes, if wind is not an excluded peril and if coverage for electronics is not excluded.

We own a restaurant and lost all the food in our freezers due to a power outage from a storm. We were not able to open for three days without electricity but we paid our employees so they would not look for other work. Will business interruption coverage pay for my loss?

Food spoilage is normally not covered in a commercial property policy unless a consequential damage endorsement was purchased. Business interruption coverage may cover the loss of receipts and/or the loss of income for your employees.

Our county was evacuated by order of the Governor because we were in the projected path of a hurricane. We closed our hotel, evacuated guests, and cancelled reservations for the period of time we were required to close. At the last minute, the hurricane moved West and we were not affected. Will business interruption cover our loss?

Generally, there is no coverage as the loss of income did not result from direct physical damage to insured property. This is called a “defined loss” in most contracts. Some policies provide this coverage by endorsement under Business Interruption by removing the “defined loss” wording.

Civil authorities closed the local hospital. Downed trees, located 2 streets over, caused a power outage. Fortunately, the hospital’s generators were on long enough to evacuate all the patients. Is the hospital covered for loss of power?

No, the downed trees did not cause direct physical loss on the insured premises.

Is business interruption coverage triggered when a business is not in an evacuation area, but is economically affected because their normal flow of customers has been removed?

As an example, consider a business that is adjacent to a geographical area that has been evacuated by civil authorities. The closing of that geographical area may include the closing of a highway such as an interstate (I-95 or I-75). Generally, coverage is not provided unless a “defined loss” has occurred. Some companies will provide coverage by endorsement under the Business Interruption by removing “defined loss” language. It is always best to review your claim questions with your adjuster after the loss.

Is business interruption coverage always provided under a Business Owners Policy (BOP) and a Commercial Package Policy (CPP)?

Business interruption coverage isn’t required; therefore, it will depend upon the company’s policy forms filed with the Office of Insurance Regulation. Business interruption coverage may be provided under the BOP and may be provided under the CPP. If the policy is written to exclude wind the business interruption coverage would also be endorsed to exclude business interruption losses caused by wind.

Does a builder’s risk policy cover damage from wind and rain?

Builder’s risk policies are named peril policies. Rain is not a named peril in the contract. However, there could be limited coverage for materials located at the job site damaged by rain if included by endorsement. Wind damage should be covered by the policy, subject to other contractual provisions. Some policies require the construction to be at a certain stage, i.e. 50% or 75% of completion before coverage applies for wind.