Question

Vince owns a television repair shop that is insured under a commercial package policy. The policy includes the building and personal property coverage form and the causes-of-loss broad form. The declarations page indicates that coverage applies to both the building and the named insured’s business property.

Part 1: Explain whether or not the following losses would be covered under his policy. (IGNORE DEDUCTIBLES)

A fire occurs on the premises, and the building is badly damaged.

A burglar steals some money and securities from an unlocked safe.

A business computer is damaged by vandals who break into the shop after business hours.

A tornado touches down near the store. Several television sets of customers in the shop for repair are damaged in the storm.

Part 2: For those losses above that are not covered by Vince’s current policy, explain whether another causes-of-loss form would have provided coverage.

Answer 1

a.) When a fire occurs on premises and the building is damaged it is covered under causes-of-loss broad form.

b.) If a burglary happens, and money and securities are stolen, it is not covered under building and personal property coverage form or the causes-of-loss broad form.

c.) The computers are also instruments and not something fixed as part of building, so it is not covered under building and personal property coverage form or the causes-of-loss broad form either.

d.) A tornado is an event occurring naturally, and thus causes-of-loss broad form covers the damage of television sets of customers.

Part- 2.) The losses that are not covered by causes-of-loss broad form here, won't be covered by any other causes-of-loss broad form, because they all cover the same scenarios.