Question

Derrick holds the position of senior risk and compliance officer of the Zerillo Company, located in western Massachusetts. He wants to obtain protection for direct physical loss under the business and personal property (BPP) coverage form. Which causes of loss form should Derrick complete in order to obtain this coverage?

	1.	broad form
	2.	basic form
	3.	standard form
	4.	special form

Answer 1

Option 4 is the correct answer.

Business and personal property coverage forms insure against all categories of peril except those that are specifically excluded from the policy. - It is a case of a special form. The special form cover against all risks except the risks which are specifically excluded from the policy.

The basic form covers only from the 11 perils or causes of losses which are divided into 2 groups:

Group 1 includes Fire, Lightning, Explosion, Vandalism, Sprinkler Leakage

Group 2 includes windstorm or Hail, Aircraft or Vehicles, Smoke, Riot and Civil Commotion, Volcanic Action and Sinkhole Collapse

The broad form includes all the perils of Basic form and additionally covers the loss from the weight of snow, ice, or sleet; falling objects and water damage