Commercial Disaster

Frequently Asked Questions & Answers

Disclaimer

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 Insurance Consumer Services, Bureau of Education, Advocacy and Research.

 

(Click a question to display the answer)

 

 

Recent storms blew out the windows of my store. Am I covered for glass breakage?

If you have a comprehensive glass insurance policy your loss should be covered. However, the policy may require safeguards, such as hurricane shutters or a specific grade of plywood, be put in place prior to the loss for coverage to be extended.

 

Recent storms blew debris into our Condo Association’s pool and damaged the fence. Do we have coverage under the Condo Association policy?

You do not have coverage under the Condo Association policy for debris removal from the pool. However, the policy may cover the damage to the fence. Contact the Association’s Board to obtain a copy of the policy to read the coverage and exclusion sections.

 

Wind blew down some trees that landed on cars parked at my dealership. Is there coverage for the cars for sale on the lot? Are my employees’ cars covered while they are parked on my lot?

Your auto dealer’s physical damage policy would provide coverage for the new cars if you included comprehensive or combined additional coverage (CAC- comprehensive coverage excluding theft) in your policy. The coverage would extend to the new cars. Sometimes, the manufacturers provide coverage for the new cars. The used cars would only be covered if coverage was added to the policy for an additional premium. The damage to your employees’ cars would be covered by the comprehensive coverage on their own auto policies.

 

Wind blew over the steeple on our church and caused several trees on the church’s property to fall and damage the fence around the building. Do we have coverage?

The damage to your steeple is covered under the multi-peril special building form or a fire and EC form. The fence would only be covered if it was added to the policy by endorsement.

 

Windstorm damaged the satellite dish used to provide cable to the rooms in my motel. Am I covered?

Yes, if windstorm was covered in your policy and electronics coverage wasn’t excluded from the policy.

 

Windstorms knocked out the power in my restaurant for three days. I had food spoilage and was unable to serve customers or pay my employees. Do I have coverage?

Food spoilage is covered if you have a consequential damage endorsement on your policy. Your business interruption policy, if you have one, may cover loss of receipts and/or your employees’ loss of income. Review your policy for coverage details.

 

Due to recent rains and windstorms, the Governor declared that our county must be evacuated. We had to shut down our hotel, evacuate guests, and cancel reservations for the days we were required to close. Do we have any coverage for this?

Generally, there is no coverage, as a defined loss has not occurred. Some companies will provide this coverage by endorsement under Business Interruption by removing the “defined loss” wording; however, this is very expensive.

 

The water system in our city was destroyed. I run a business that requires a generous amount of water, which the city is unable to provide. Do I have coverage for the loss of income on the days I could not operate my business due to the restriction on water supply?

If you purchased an endorsement to cover this type of loss, you should make a claim for lost income.

 

My grocery store was flooded and a windstorm knocked out power for several days. All the food on the lower shelves was ruined and had to be thrown away. Some food in the freezer also spoiled. Do I have any coverage for this?

Your flood policy would only provide coverage if you insured the contents and you can prove the food was ruined by the floodwaters. The spoiled food in the freezer could be covered by your policy under the consequential damage section. Check your policy for details.

 

Heavy rains from the storm caused my daycare center to be flooded. The children had to have a place to stay so I rented several rooms in another building. Does my flood policy have to pay for this extra expense?

No, flood policies do not provide coverage for loss of use. Business package policies may have an endorsement adding Extra Expense Coverage, however, flood is also excluded from this coverage.

 

Heavy rains and high winds knocked out the computer system at my business for a week. Am I covered for “down time?”

Not unless you have a special computer endorsement at an additional cost on your policy that provides this coverage.

 

Civil authorities closed the local hospital. Fortunately, the hospital’s generators were on long enough to evacuate all the patients. Is the hospital covered for loss of power?

No.

 

Is business interruption coverage triggered when a business is not in the evacuation area, but is economically affected because their usual flow of customers has been cut off?

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”. It is always best to review your claim questions with your adjuster after the loss. If coverage is agreed upon, the deductible for business interruption insurance applies.

 

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

Business interruption coverage isn’t a required coverage, therefore, it will depend upon the company’s form filing. Business interruption coverage may be provided under the BOP and may be provided under the CPP. If the property policy is written to exclude wind the business interruption coverage would be endorsed to exclude business interruption losses caused by wind damage whether direct or indirect.

 

I am a contractor who has several insured buildings around town under construction. Recent rains and wind have caused damage at several sites. Does my multi-peril builder’s risk policy provide coverage for the damage?

Multi-peril builder’s risk policies are a named peril policy. There wouldn’t be coverage for the rain damage unless the contractor had an Inland Marine contract included with his multi-peril policy to cover specific materials located at a job site. There is coverage for the wind damage subject to contractual provisions. Some policies require the construction to be at a certain stage, i.e. 50% or 75% complete before coverage will be extended for the wind damage.

 

 

 
 
 

PAGE HISTORY

STATUS OF HELP TOPIC
DATE OWNER

STATUS

REASON FOR STATUS

05/2008  Knowledge Center ACTIVE

NEW TOPIC

     

 

VOLATILITY OF HELP TOPIC
DATE OWNER

VOLATILITY

REVIEW DATE

COMMENTS

    MEDIUM

 

 

     

 

 

CHANGES TO HELP TOPIC
DATE EDITOR

DESCRIPTION OF CHANGES

   

 

   

 

TAGS RELATED TO THE HELP TOPIC (SINGLE-WORD LABELS)