Commercial Property Insurance
A guide to commercial property insurance: what it covers, what it excludes, what actually goes wrong, what reduces it, and what an underwriter asks. Every statement cites a published source.
Overview
What this line is, and who or what it is designed to protect.
Commercial property insurance pays for direct physical loss of or damage to a business's buildings and business personal property caused by a covered cause of loss. This page is general information about how specific published forms are written. It is not legal advice, it is not a coverage determination, and it does not decide whether any particular loss is covered. Whether a loss is covered is decided by the insurer on the policy actually issued and the facts of the claim, and disputes about that are legal questions for a lawyer. In the common ISO structure, the property insured is described in one form and the perils are supplied by a second form: the Building And Personal Property Coverage Form CP 00 10 10 12 insures Building, Your Business Personal Property and Personal Property Of Others as separately scheduled coverages, and that form states that Covered Property means the types of property described in its section A.1 and limited in its section A.2 Property Not Covered, and only if a Limit Of Insurance is shown in the Declarations for that type of property [1]. A causes of loss form sets what counts as a Covered Cause of Loss; the one read for this page is CP 10 30 09 17, which states that when Special is shown in the Declarations, Covered Causes of Loss means direct physical loss unless the loss is excluded or limited in the policy [2]. Loss of income is not covered by CP 00 10 10 12. Business income is written as its own coverage form, CP 00 30 10 12, separate from the Building And Personal Property Coverage Form, with its own limit of insurance, its own coinsurance condition and its own definitions [3]. Several provisions of CP 00 10 10 12 bear on how much is paid on a covered loss. The main ones, and this is not the whole form, are the Limit of Insurance shown in the Declarations for the affected property; the section D Deductible; the Coinsurance Additional Condition, which states that the insurer will not pay the full amount of a loss where the value of Covered Property at the time of loss times the coinsurance percentage shown in the Declarations is greater than the Limit of Insurance for that property; and the Valuation loss condition, which sets actual cash value as of the time of loss as the default except as its own subparagraphs b. through e. provide [1]. The section G Optional Coverages, which apply only where shown as applicable in the Declarations, change several of those, and the section C Limitations in the causes of loss form and the sublimits inside the Additional Coverages and Coverage Extensions bear on the figure as well [1][2]. Everything below describes CP 00 10 10 12, CP 10 30 09 17 and CP 00 30 10 12 as published. Edition dates, state variants and carrier forms differ, so read the forms actually attached to the policy.
Buildings and structures, including completed additions, permanently installed fixtures, machinery and equipment, as described in the Building coverage of CP 00 10 10 12, insured only if a Limit Of Insurance for Building is shown in the Declarations and only as limited by that form's A.2 Property Not Covered [1]
Business personal property such as furniture, fixtures, machinery, equipment and stock, insured as Your Business Personal Property under CP 00 10 10 12, which that form describes as property located in or on the described building or structure or in the open, or in a vehicle, within 100 feet of the building or structure or of the described premises, whichever distance is greater [1]
Property of others in the insured's care, custody or control, insured as Personal Property Of Others under CP 00 10 10 12, which that form limits to such property located in or on the described building or structure or in the open, or in a vehicle, within 100 feet of the described premises [1]
A lender's interest in buildings or structures, through the Mortgageholders Additional Condition at F.2 of CP 00 10 10 12, which by its terms pays covered loss of or damage to buildings or structures to each mortgageholder shown in the Declarations in their order of precedence [1]
Earnings and continuing normal operating expenses after a suspension of operations, where CP 00 30 10 12 Business Income coverage is purchased and its trigger is met [3]
The extra costs of continuing to operate after a loss, through the Extra Expense coverage in CP 00 30 10 12 [3]
What it covers
Each note carries a policy-form caveat, because what a form covers is read in that form.
Specified (named) perils, where the causes of loss form lists what is insured against
CDI describes specified perils as consisting of a list of each peril to be insured against, such as fire, explosion, windstorm and vandalism [5]. That is a regulator's general description of the specified perils approach, not the text of any form. The only causes of loss form read for this page is CP 10 30 09 17, which is the special form rather than a named perils form; no ISO basic or broad causes of loss form was reviewed here. Which causes of loss form is attached, and what it lists, is what governs, so read the form on the policy.
Open perils, under the Causes Of Loss - Special Form
CP 10 30 09 17 states that when Special is shown in the Declarations, Covered Causes of Loss means direct physical loss unless the loss is excluded or limited in the policy [2]. CDI describes open perils coverage as covering all losses unless they are specifically excluded [5]. That structure is broader than a list of named perils, but it is not all-risk in the plain-English sense, because CP 10 30 09 17 runs sections A through G and devotes section B to exclusions and section C to limitations [2]. This describes CP 10 30 09 17 only; read the causes of loss form attached to the policy.
Business income loss during the period of restoration
CP 00 30 10 12 states that the insurer will pay for the actual loss of Business Income the insured sustains due to the necessary suspension of its operations during the period of restoration, and that the suspension must be caused by direct physical loss of or damage to property at premises described in the Declarations for which a Business Income Limit Of Insurance is shown [3]. That form defines Business Income as Net Income, meaning net profit or loss before income taxes that would have been earned or incurred, plus continuing normal operating expenses incurred, including payroll [3]. This describes CP 00 30 10 12 only; read the business income form attached to the policy.
Extra expense
CP 00 30 10 12 defines Extra Expense as necessary expenses incurred during the period of restoration that the insured would not have incurred if there had been no direct physical loss or damage to property caused by or resulting from a Covered Cause of Loss [3]. Under that form, the period of restoration begins immediately after the time of direct physical loss or damage for Extra Expense Coverage, with no 72-hour wait [3]. This describes CP 00 30 10 12 only; read the form attached to the policy.
Rental value
Under CP 00 30 10 12, coverage may be written as Business Income Including Rental Value, or as Rental Value only, depending on which option is selected in the Declarations, which matters where the loss is rent rather than operating profit [3]. That form's definition of Suspension also covers the case where part or all of the described premises is rendered untenantable, where Rental Value coverage applies [3]. This describes CP 00 30 10 12 only; read the form attached to the policy.
Additional coverages and coverage extensions in the property form
CP 00 10 10 12 carries Additional Coverages at A.4 and Coverage Extensions at A.5 [1]. The Coverage Extensions are not automatic: that form states that, except as otherwise provided, they apply to property located in or on the described building or in the open, or in a vehicle, within 100 feet of the described premises, and that the insured may extend the insurance as described only if a coinsurance percentage of 80 percent or more, or a Value Reporting period symbol, is shown in the Declarations [1]. Those Additional Coverages and Extensions have their own limits and conditions inside the form, so read the specific amounts printed in CP 00 10 10 12 and in the Declarations rather than assuming a standard figure. This describes CP 00 10 10 12 only.
Collapse, and limited coverage for fungus, wet rot, dry rot and bacteria, as additional coverages
In CP 10 30 09 17, collapse appears at section D as Additional Coverage - Collapse, and that form states the coverage applies only to an abrupt collapse as described and limited in D.1 through D.7 and that it will not increase the Limits of Insurance provided in the Coverage Part [2]. Section E is Additional Coverage - Limited Coverage For Fungus, Wet Rot, Dry Rot And Bacteria, which the form says applies only where the fungus, wet or dry rot or bacteria result from a specified cause of loss other than fire or lightning, or from flood where the Flood Coverage Endorsement applies, occurring during the policy period, and only if all reasonable means were used to save and preserve the property from further damage at the time of and after that occurrence [2]. That form limits the coverage described at E.2 to $15,000 as the most it will pay for the total of all such loss or damage taking place in a 12-month period, and states the Limited Coverage does not increase the applicable Limit of Insurance [2]. Neither is an open-ended peril; each is a defined additional coverage with its own conditions. This describes CP 10 30 09 17 only; read the form attached to the policy.
What it excludes
Exclusions and limitations as the published forms state them.
Earthquake and other earth movement
In CP 10 30 09 17, exclusion B.1.b Earth Movement covers earthquake including tremors and aftershocks, landslide, mine subsidence, earth sinking other than sinkhole collapse, rising or shifting, and volcanic eruption, explosion or effusion [2]. The carve-out of sinkhole collapse from b.(4) matters, because sinkhole collapse is one of the specified causes of loss defined at G.2 of that form [2]. The exceptions are not uniform across that list. The form states that if Earth Movement as described in b.(1) through (4) results in fire or explosion, the insurer will pay for the loss or damage caused by that fire or explosion; separately, it states that if volcanic eruption, explosion or effusion under b.(5) results in fire, building glass breakage or Volcanic Action, the insurer will pay for the loss or damage caused by that fire, building glass breakage or Volcanic Action [2]. Building glass breakage is therefore an exception to the volcanic paragraph, not to earthquake or landslide. The form defines Volcanic Action inside that exclusion, as direct loss or damage resulting from the eruption of a volcano caused by airborne volcanic blast or airborne shock waves, ash, dust or particulate matter, or lava flow, treats all volcanic eruptions within any 168-hour period as a single occurrence, and states that Volcanic Action does not include the cost to remove ash, dust or particulate matter that does not cause direct physical loss or damage to the described property [2]. The form also states that the Earth Movement exclusion applies regardless of whether any of b.(1) through (5) is caused by an act of nature or is otherwise caused [2]. CDI likewise describes earth movement including earthquake as one of two common perils excluded under open perils coverage [5]. Whether earthquake coverage can be added by endorsement or requires a separate placement, and on what terms and deductible, is a carrier underwriting decision. This describes CP 10 30 09 17 only; read the form attached to the policy.
Flood and other water
In CP 10 30 09 17, exclusion B.1.g Water removes flood, surface water, waves including tidal wave and tsunami, tides, tidal water, overflow of any body of water or spray from any of these whether or not driven by wind; mudslide or mudflow; water that backs up or overflows or is otherwise discharged from a sewer, drain, sump, sump pump or related equipment; water under the ground surface pressing on or flowing or seeping through foundations, walls, floors, paved surfaces, basements, doors, windows or other openings; and waterborne material moved by that water [2]. The form states that this exclusion applies regardless of whether any of paragraphs (1) through (5) is caused by an act of nature or is otherwise caused, and gives as an example the failure, in whole or in part and for any reason, of a dam, levee, seawall or other boundary or containment system to contain the water [2]. The exception is narrower than it is sometimes described: the form states that if any of paragraphs (1) through (5) results in fire, explosion or sprinkler leakage, the insurer will pay for the loss or damage caused by that fire, explosion or sprinkler leakage, and it qualifies the sprinkler leakage branch with the parenthetical if sprinkler leakage is a Covered Cause of Loss [2]. There is no defined term Water in that form: section G Definitions of CP 10 30 09 17 contains exactly two defined terms, Fungus and Specified causes of loss, and water damage is defined only inside the Specified causes of loss definition at G.2.c [2]. CDI describes flood as one of two common perils excluded under open perils coverage [5]. This describes CP 10 30 09 17 only; read the form attached to the policy.
Ordinance or law
In CP 10 30 09 17, exclusion B.1.a Ordinance Or Law removes the enforcement of or compliance with any ordinance or law regulating the construction, use or repair of any property, or requiring the tearing down of any property including the cost of removing its debris, and states that it applies whether the loss results from an ordinance enforced even if the property has not been damaged, or from increased costs incurred to comply with an ordinance in the course of construction, repair, renovation, remodeling or demolition following a physical loss [2]. CP 00 30 10 12 has a parallel carve-out: the period of restoration in that form does not include any increased period required due to the enforcement of or compliance with any ordinance or law that regulates the construction, use or repair, or requires the tearing down, of any property [3]. These notes describe CP 10 30 09 17 and CP 00 30 10 12 only; read the forms attached to the policy.
Wear and tear, rust, corrosion, decay and other gradual deterioration
Exclusion B.2.d of CP 10 30 09 17 runs d.(1) through d.(7) and excludes loss or damage caused by or resulting from: (1) wear and tear; (2) rust or other corrosion, decay, deterioration, hidden or latent defect or any quality in property that causes it to damage or destroy itself; (3) smog; (4) settling, cracking, shrinking or expansion; (5) nesting or infestation, or discharge or release of waste products or secretions, by insects, birds, rodents or other animals; (6) mechanical breakdown, including rupture or bursting caused by centrifugal force; and (7) dampness or dryness of atmosphere, changes in or extremes of temperature, and marring or scratching, each as to personal property only [2]. Two exceptions inside that paragraph matter and are easy to miss. The mechanical breakdown subparagraph states that if mechanical breakdown results in elevator collision, the insurer will pay for the loss or damage caused by that elevator collision [2]. And the paragraph closes with a general ensuing-loss exception: if an excluded cause of loss listed in 2.d.(1) through (7) results in a specified cause of loss or building glass breakage, the insurer will pay for the loss or damage caused by that specified cause of loss or building glass breakage [2]. Faulty or inadequate maintenance is not in B.2 at all; it appears separately at B.3.c(4), and section B.3 carries its own exception stating that if an excluded cause of loss listed in 3.a. through 3.c. results in a Covered Cause of Loss, the insurer will pay for the loss or damage caused by that Covered Cause of Loss [2]. So under this form deterioration and faulty maintenance are excluded as causes, but what they lead to can still be paid where one of those stated exceptions applies. That is a statement about CP 10 30 09 17, not a universal rule of the property line; read the causes of loss form attached to the policy.
Dishonest or criminal acts by the insured or its employees
Section B.2.h of CP 10 30 09 17 excludes dishonest or criminal act, including theft, by the named insured, any of its partners, members, officers, managers, employees including temporary employees and leased workers, directors, trustees or authorized representatives, whether acting alone or in collusion with each other or with any other party; the same exclusion carries a second branch covering theft by any person to whom the insured entrusts the property for any purpose, whether acting alone or in collusion with any other party [2]. The exclusion states that it applies whether or not the act occurs during the insured's normal hours of operation, and it carries a stated exception: it does not apply to acts of destruction by the insured's employees, including temporary employees and leased workers, or authorized representatives, but theft by those same people is not covered [2]. So under this form employee vandalism can be a different question from employee theft. Coverage for employee theft would have to come from something other than this causes of loss form. This describes CP 10 30 09 17 only; read the form attached to the policy.
Fungus, wet rot, dry rot and bacteria
Exclusion B.1.h of CP 10 30 09 17 removes presence, growth, proliferation, spread or any activity of fungus, wet or dry rot or bacteria, and states that the exclusion does not apply where those result from fire or lightning, or to the extent coverage is provided in the Additional Coverage at section E, Limited Coverage For Fungus, Wet Rot, Dry Rot And Bacteria, and that second branch is itself qualified in the form to loss or damage by a cause of loss other than fire or lightning [2]. The form also states that if fungus, wet or dry rot or bacteria result in a specified cause of loss, the insurer will pay for the loss or damage caused by that specified cause of loss [2]. This describes CP 10 30 09 17 only; read the form attached to the policy.
Governmental action, nuclear hazard, utility services, and war and military action
These are exclusions B.1.c through B.1.f of CP 10 30 09 17 [2]. Three of the four carry stated exceptions that a reader must not drop, and the fourth, War And Military Action at B.1.f, carries none in that form [2]. The Governmental Action exclusion at B.1.c removes seizure or destruction of property by order of governmental authority, but the form then states that the insurer will pay for loss or damage caused by or resulting from acts of destruction ordered by governmental authority and taken at the time of a fire to prevent its spread, if the fire would be covered under the Coverage Part [2]. The Nuclear Hazard exclusion at B.1.d removes nuclear reaction or radiation, or radioactive contamination, however caused, but the form then states that if nuclear reaction or radiation, or radioactive contamination, results in fire, the insurer will pay for the loss or damage caused by that fire [2]. The Utility Services exclusion at B.1.e removes the failure of power, communication, water or other utility service supplied to the described premises, however caused, where the failure originates away from the described premises or involves equipment used to supply the service from a source away from the premises, and it also excludes loss caused by a surge of power that would not have occurred but for an event causing a failure of power [2]. The form states that failure of any utility service includes lack of sufficient capacity and reduction in supply, and that communication services include but are not limited to service relating to Internet access or access to any electronic, cellular or satellite network [2]. It excepts a Covered Cause of Loss resulting from that failure or surge [2]. This describes CP 10 30 09 17 only; read the form attached to the policy.
Neglect to protect property after a loss
Section B.2.m of CP 10 30 09 17 excludes neglect of an insured to use all reasonable means to save and preserve property from further damage at and after the time of loss [2]. Under this form, post-loss mitigation therefore bears directly on what is payable. That is a statement about CP 10 30 09 17; read the causes of loss form attached to the policy.
Business income where the form's physical damage trigger is not met
Whether any particular event triggers business income coverage is a claim question decided by the insurer on the policy issued and the facts, and contested triggers are legal questions for a lawyer. This page states only what the form requires. CP 00 30 10 12 states that the suspension of operations must be caused by direct physical loss of or damage to property at premises described in the Declarations for which a Business Income Limit Of Insurance is shown, and that the loss or damage must be caused by or result from a Covered Cause of Loss [3]. It also defines Suspension as the slowdown or cessation of business activities, or the described premises being rendered untenantable where Rental Value coverage applies [3]. This describes CP 00 30 10 12 only; read the form attached to the policy.
The section B.1 exclusions carry a lead-in about contributing causes
The section B.1 exclusions in CP 10 30 09 17 are introduced by language stating that the insurer will not pay for loss or damage caused directly or indirectly by any of the listed causes, and that such loss or damage is excluded regardless of any other cause or event that contributes concurrently or in any sequence to the loss [2]. That sentence is the wording of the clause and is all this page states about it. What effect the clause has on any particular loss is not determined by the form text and is not decided here; take it to a lawyer. This describes CP 10 30 09 17 only; read the form attached to the policy.
What goes wrong
The loss drivers, as distinct from what the policy protects. This is the question an underwriter is asking.
Direct physical loss to a building or to business personal property
The building and personal property coverage form is the document that defines what property is covered and on what basis [1]. What counts as covered property, and what is excluded from it, is read there rather than assumed.
Loss of income while the property is being repaired
Business income and extra expense is addressed by its own form rather than by the property form [3], so the time element and the physical damage are two separate grants with their own conditions.
A cause of loss the policy does not name
The causes of loss form determines which perils are in scope [2]. A named-peril and a special-form policy answer this exposure differently, and which one is in force is on the declarations page.
Underinsurance discovered at the time of loss
California law addresses the measure of indemnity and the effect of the amount of insurance carried [6]. A limit set once and never revisited is the ordinary way this exposure arises.
Liability arising from the same premises, which the property policy does not address
Property and liability are separate coverage parts: the general liability form responds to sums owed as damages because of bodily injury or property damage to others [4], which is a different question from damage to the insured's own building.
What reduces it
Things you can do, each tied to a source. None of these is a promise about price; whether an insurer credits any of them is an underwriting decision.
Read the causes of loss form before assuming a peril is covered
Scope is set by the causes of loss form attached to the policy [2], not by the property form alone. Ask which causes of loss form is in force and read it.
Revisit the limit against current replacement cost, in writing
The statutory measure of indemnity turns in part on the amount of insurance carried [6]. A written, dated basis for the limit is what makes the figure defensible later.
Confirm business income is actually purchased and on what period
Business income and extra expense sits on its own form [3]. Its presence, its limit and its period of restoration are separate from the property limit and are read on that form.
Assemble the underwriting information the market asks for before you need terms
Commercial property submissions ask for construction, occupancy, protection and exposure information [5]. Having it current shortens the conversation and makes gaps visible while there is still time to address them.
Underwriting
Information commonly requested. Common practice rather than a filed requirement.
Construction type, year built, number of stories, square footage and occupancy of each building
Age and condition of roof, electrical, plumbing and HVAC, and the dates of any updates
Protection information: sprinklers, alarms, distance to hydrant and responding fire station, and public protection classification
A statement of values supporting the Building and business personal property limits, since under CP 00 10 10 12 the Limit of Insurance drives both the amount recoverable and the Coinsurance calculation [1]
A business income worksheet showing net income and continuing operating expenses including payroll for the 12 months following inception, which is the period the Coinsurance Additional Condition in CP 00 30 10 12 measures [3]
Catastrophe exposure: distance to coast, brush and wildfire exposure, flood zone and seismic exposure
Loss history, typically several years of currently valued loss runs
Whether the insured is owner or tenant, and what the lease requires the tenant to insure
Which causes of loss form is being requested, and which coinsurance percentage and valuation basis apply. CDI describes the specified perils and open perils approaches and the actual cash value, agreed value and replacement cost valuation approaches [5]
Lender requirements, including mortgageholder wording, which CP 00 10 10 12 addresses in its Mortgageholders Additional Condition [1]
This list describes information commonly requested in practice. It is common practice rather than a legal or filed requirement, and what any particular insurer asks for, and whether it offers terms at all, is a carrier underwriting decision
Limits and endorsements
How the limit is structured, and the endorsements that change it.
Limits of insurance are scheduled separately in the Declarations for Building, Your Business Personal Property and Personal Property Of Others under CP 00 10 10 12 [1].
Section D Deductible of CP 00 10 10 12 applies in any one occurrence of loss or damage: the form first reduces the amount of loss if required by the Coinsurance Condition or the Agreed Value Optional Coverage, pays nothing if the adjusted amount is less than or equal to the deductible, and otherwise subtracts the deductible and pays the resulting amount or the Limit of Insurance, whichever is less [1]. That section also states that where the occurrence involves loss to more than one item of Covered Property and separate Limits of Insurance apply, the losses will not be combined in determining application of the deductible, but the deductible will be applied only once per occurrence [1]. If a policy shows a percentage or named-storm deductible, that provision does not come from this base form; find the endorsement or Declarations entry that creates it and read its own wording.
Coinsurance is Additional Condition F.1 of CP 00 10 10 12 and applies only if a coinsurance percentage is shown in the Declarations [1]. It states that the insurer will not pay the full amount of any loss if the value of Covered Property at the time of loss times the coinsurance percentage shown in the Declarations is greater than the Limit of Insurance for that property [1].
The coinsurance calculation in CP 00 10 10 12 multiplies the value of Covered Property at the time of loss by the coinsurance percentage, divides the Limit of Insurance by that figure, multiplies the total amount of loss before the application of any deductible by the result, and then subtracts the deductible; the form states that it will pay the amount so determined or the Limit of Insurance, whichever is less, and that for the remainder the insured will either have to rely on other insurance or absorb the loss itself [1]. Because the shortfall is applied to the amount of loss, it reaches partial losses and not only total losses. That form also states that where one Limit of Insurance applies to two or more separate items, the Coinsurance condition applies to the total of all property to which the limit applies [1]. CDI describes coinsurance as a clause defining the amount of each loss the company pays according to the amount of insurance carried divided by the amount of insurance required, and warns that a policyholder can be subject to a monetary penalty at the time of a loss where a building is not insured to value [5].
The Agreed Value Optional Coverage in section G of CP 00 10 10 12 states that the Additional Condition, Coinsurance, does not apply to Covered Property to which that Optional Coverage applies [1]. The same paragraph carries a second clause that is easy to drop: the form states that it will pay no more for loss of or damage to that property than the proportion that the Limit of Insurance under the Coverage Part for the property bears to the Agreed Value shown for it in the Declarations [1]. The Optional Coverage also applies only to loss or damage occurring on or after its effective date and before the earlier of the Agreed Value expiration date shown in the Declarations or the policy expiration date [1]. CDI, describing the agreed value approach generally rather than this form, says it waives any coinsurance penalty and pays 100 percent of the stated amount [5]; on CP 00 10 10 12 the proportional clause above is what the form actually prints, so read the form rather than the general description.
CP 00 30 10 12 carries its own Coinsurance Additional Condition, measured against the coinsurance percentage times the sum of Net Income and operating expenses including payroll that would have been earned or incurred for the 12 months following the inception or last previous anniversary date of the policy, whichever is later [3]. That is a forward-looking figure under the form, so a worksheet built only on last year's actuals is measuring something different from what the condition measures.
The Maximum Period Of Indemnity and Monthly Limit Of Indemnity Optional Coverages in CP 00 30 10 12 each state that the Additional Condition, Coinsurance, does not apply [3].
Business income under CP 00 30 10 12 uses a waiting period rather than a dollar deductible: the period of restoration begins 72 hours after the time of direct physical loss or damage for Business Income Coverage and immediately after that time for Extra Expense Coverage [3]. That waiting period is a provision of this edition of this form; other editions and carrier forms can differ, so check what is attached.
Valuation defaults to actual cash value as of the time of loss or damage under loss condition E.7 of CP 00 10 10 12, and that form states the default applies except as provided in subparagraphs b., c., d. and e. of that condition, which are four stated exceptions rather than one [1]. Subparagraph b. pays the cost of building repairs or replacement where the Limit of Insurance for Building satisfies the Coinsurance condition and the cost to repair or replace the damaged building property is $2,500 or less; that exception itself excludes the increased cost attributable to enforcement of or compliance with any ordinance or law regulating the construction, use or repair of any property, and the form directs that awnings or floor coverings, appliances for refrigerating, ventilating, cooking, dishwashing or laundering, and outdoor equipment or furniture be valued at actual cash value even when attached to the building [1]. Subparagraph c. values Stock the insured has sold but not delivered at the selling price less discounts and expenses it otherwise would have had; subparagraph d. values glass at the cost of replacement with safety-glazing material if required by law; and subparagraph e. values tenants' improvements and betterments in three branches, not two: at actual cash value if repairs are made promptly; at a stated proportion of original cost, computed from the days remaining on the lease, if they are not; and at nothing if others pay for the repairs or replacement [1].
Replacement Cost is Optional Coverage G.3 of CP 00 10 10 12, applies only if shown as applicable in the Declarations, and replaces Actual Cash Value in the Valuation loss condition [1]. That Optional Coverage states it does not apply to four things: personal property of others; contents of a residence; works of art, antiques or rare articles including etchings, pictures, statuary, marbles, bronzes, porcelains and bric-a-brac; and Stock, unless the Including Stock option is shown in the Declarations [1]. The Stock carve-out matters for retail, wholesale and distribution risks.
Under CP 00 10 10 12, the insurer will not pay on a replacement cost basis until the lost or damaged property is actually repaired or replaced, and unless the repair or replacement is made as soon as reasonably possible after the loss or damage [1]. The form also lets the insured claim on an actual cash value basis first and still claim the additional replacement cost amount if it gives notice of intent to do so within 180 days after the loss or damage [1]. Because the form conditions payment on the repair or replacement having actually been made, the replacement cost portion under CP 00 10 10 12 is payable after that work rather than before it. Tenants' improvements and betterments have their own branch: that Optional Coverage states that where those two conditions are not met, tenants' improvements and betterments are valued as a proportion of original cost as set out in the Valuation loss condition, and that the insurer will not pay for loss or damage to them at all if others pay for the repairs or replacement [1].
Replacement cost under CP 00 10 10 12 is also capped and carved out. That Optional Coverage states the insurer will not pay more on a replacement cost basis than the least of the Limit of Insurance applicable to the lost or damaged property, the cost to replace it with other property of comparable material and quality used for the same purpose, or the amount actually spent that is necessary to repair or replace it, and that if a building is rebuilt at a new premises the replacement cost figure is limited to what would have been incurred had it been rebuilt at the original premises [1]. It further states that the cost of repair or replacement does not include the increased cost attributable to enforcement of or compliance with any ordinance or law regulating the construction, use or repair of any property [1].
Inflation Guard is Optional Coverage G.2 of CP 00 10 10 12 and automatically increases the Limit of Insurance for property to which it applies by the annual percentage shown in the Declarations [1]. That increase accrues over the year rather than landing all at once: the form computes the amount of increase as the Limit of Insurance in effect at the most recent policy inception, anniversary or limit-amending change, times the annual percentage shown in the Declarations, times the number of days since that date divided by 365 [1].
Ordinance or Law coverage
Addresses the B.1.a Ordinance Or Law exclusion in CP 10 30 09 17 and the parallel ordinance or law carve-out from the period of restoration in CP 00 30 10 12 [2][3]. No ordinance or law endorsement was reviewed for this page, so what any particular one covers, and with what limits, comes from that endorsement's own wording.
Earthquake and flood coverage or separate policies
Needed because CP 10 30 09 17 excludes Earth Movement at B.1.b and Water at B.1.g [2], and because CDI describes earth movement including earthquake and flood as two common perils excluded under open perils coverage [5]. Whether a given risk can get earthquake or flood coverage by endorsement or by separate placement, on what terms, and whether that placement is admitted or surplus line, are carrier and broker decisions on the individual risk; no source cited on this page speaks to that, and no earthquake or flood endorsement or standalone policy form was reviewed here.
Agreed Value
Under CP 00 10 10 12, the Agreed Value Optional Coverage suspends the Coinsurance Additional Condition for the Covered Property to which it applies, and the form states that if the expiration date shown for it in the Declarations is not extended, Coinsurance is reinstated and the Optional Coverage expires [1]. It therefore has to be maintained at each renewal to keep operating. Suspending coinsurance is not the same as removing every proportional reduction: the same paragraph states that the insurer will pay no more for loss of or damage to that property than the proportion that the Limit of Insurance for the property bears to the Agreed Value shown for it in the Declarations [1]. This describes CP 00 10 10 12 only.
Replacement Cost, including the extension to personal property of others
Replacement Cost is an Optional Coverage in CP 00 10 10 12 that must be shown as applicable in the Declarations, and by its own terms it does not apply to personal property of others, contents of a residence, works of art, antiques or rare articles, or Stock unless the Including Stock option is shown [1]. That form carries a separate Extension Of Replacement Cost To Personal Property Of Others Optional Coverage at G.4, which the form says may be shown as applicable only if the Replacement Cost Optional Coverage is itself shown as applicable, and which deletes the personal-property-of-others carve-out while leaving the rest of the Replacement Cost Optional Coverage in force [1]. Under that Extension, where an item of personal property of others is subject to a written contract governing the insured's liability for loss or damage to it, valuation of that item is based on the amount for which the insured is liable under that contract, but the form caps that at the lesser of the replacement cost of the property or the applicable Limit of Insurance, and that cap is part of the same sentence [1]. This describes CP 00 10 10 12 only.
Business income options: Maximum Period Of Indemnity, Monthly Limit Of Indemnity, Business Income Agreed Value, Extended Period Of Indemnity
These are the four Optional Coverages in CP 00 30 10 12 [3]. Extended Period Of Indemnity matters because the base period of restoration in that form ends on the earlier of the date the property should be repaired, rebuilt or replaced with reasonable speed and similar quality, or the date business is resumed at a new permanent location, rather than when revenue recovers [3]. This describes CP 00 30 10 12 only.
Utility services, direct damage and time element
CP 10 30 09 17 excludes Utility Services at B.1.e, so off-premises power, water or communication failure falls outside that form's covered causes of loss except where it results in a Covered Cause of Loss [2]. Any coverage for that exposure has to come from an endorsement. No utility services endorsement was reviewed for this page.
Equipment breakdown, spoilage, and dependent property (contingent business income)
CP 00 30 10 12 requires the suspension to be caused by direct physical loss of or damage to property at premises described in the Declarations, so damage at a supplier's or customer's premises is outside that trigger unless something else supplies it [3]. No dependent property, equipment breakdown or spoilage endorsement was reviewed for this page; read the endorsement attached to the policy.
Inflation Guard
Inflation Guard is an Optional Coverage in CP 00 10 10 12 that automatically increases the Limit of Insurance for property to which it applies by the annual percentage shown in the Declarations, computed by that form as the applicable limit times that percentage times the number of days since the beginning of the current policy year or the most recent limit-amending change, divided by 365 [1]. Because the Coinsurance condition in that form measures the Limit of Insurance against the value of Covered Property at the time of loss, a limit that moves with values behaves differently under that calculation than a static one [1]. This describes CP 00 10 10 12 only.
By state
Where a state changes the answer. Only the states read for this page appear.
CA
CDI's Commercial Insurance Guide describes specified perils versus open perils, states that earth movement including earthquake and flood are two common perils excluded under open perils coverage, describes the actual cash value, agreed value and replacement cost valuation approaches, and warns that a policyholder can be subject to a monetary penalty at the time of a loss where a building is not insured to value [5]. CDI also states that after three documented declinations from licensed commercial carriers a business can proceed to the surplus line market, that a surplus line company can only be accessed through a specially licensed broker, that the CDI has limited jurisdiction over the operation of surplus line insurers, and that the California Insurance Guarantee Association, which protects claims with admitted insurers, does not apply to surplus line insurers [5]. On causation, California Insurance Code section 530 states that an insurer is liable for a loss of which a peril insured against was the proximate cause, although a peril not contemplated by the contract may have been a remote cause of the loss, but is not liable for a loss of which the peril insured against was only a remote cause [6]. That is what the statute says. How it bears on any particular policy wording or loss is a legal question for a lawyer and is not answered anywhere on this page. Nothing on this page determines whether a specific California property is written in the admitted market, placed in the surplus line market, or eligible for any residual market program; those are carrier and broker decisions on the individual risk.
US
The provisions described on this page are those of CP 00 10 10 12 and CP 00 30 10 12, each carrying the ISO copyright date 2011, and CP 10 30 09 17, carrying the ISO copyright date 2016 [1][3][2]. They describe specific editions of specific forms, not universal policy language. Other editions, state variants and carrier forms exist and can read differently, so read the forms on the policy.
Source ledger
Every numbered marker in this guide resolves to a record below. Each record lists the exact claims it supports, and each claim has its own address.
Source ledger
6 sources. Every citation number above resolves to a record below. Nothing here sits behind an account.
- [1]Building And Personal Property Coverage Form CP 00 10 10 12 (ISO)(opens the original record on Insurance Services Office, Inc. (form text); posted in the Property Insurance Coverage Law Blog forms library (Merlin Law Group))Insurance Services Office, Inc. (form text); posted in the Property Insurance Coverage Law Blog forms library (Merlin Law Group)Standards bodyPrimaryJurisdiction USLast checked August 31, 2026Updates: ISO revises the commercial property program periodically; later editions and state-specific variants exist, and carriers may use manuscript forms.ID
iso-cp-00-10-10-12What this source supports (26)
- CP 00 10 10 12 is the Building And Personal Property Coverage Form, and it insures Building, Your Business Personal Property and Personal Property Of Others as separately scheduled coverages in the Declarations.
- The form states that Covered Property means the types of property described in section A.1 and limited in section A.2 Property Not Covered, if a Limit Of Insurance is shown in the Declarations for that type of property.
- The form describes Your Business Personal Property as property located in or on the described building or structure or in the open, or in a vehicle, within 100 feet of the building or structure or within 100 feet of the described premises, whichever distance is greater, and describes Personal Property Of Others as property in the insured's care, custody or control and located in or on the described building or structure or in the open, or in a vehicle, within 100 feet of the described premises.
- The form carries Additional Coverages at A.4 and Coverage Extensions at A.5 in addition to the scheduled limits of insurance.
- Section A.5 states that the Coverage Extensions apply to property located in or on the building described in the Declarations or in the open, or in a vehicle, within 100 feet of the described premises, and that the insured may extend the insurance provided by the Coverage Part as the Extensions describe if a coinsurance percentage of 80 percent or more, or a Value Reporting period symbol, is shown in the Declarations.
- Section D Deductible provides that in any one occurrence of loss or damage the insurer will first reduce the amount of loss if required by the Coinsurance Condition or the Agreed Value Optional Coverage, will not pay if the adjusted amount of loss is less than or equal to the deductible, and will otherwise subtract the deductible from the adjusted amount of loss and pay the resulting amount or the Limit of Insurance, whichever is less.
- Section D Deductible also states that when the occurrence involves loss to more than one item of Covered Property and separate Limits of Insurance apply, the losses will not be combined in determining application of the deductible, but the deductible will be applied only once per occurrence.
- The Valuation loss condition in section E.7 states that the insurer will determine the value of Covered Property at actual cash value as of the time of loss or damage, except as provided in subparagraphs b., c., d. and e. of that condition.
- Subparagraph E.7.b pays the cost of building repairs or replacement where the Limit of Insurance for Building satisfies the Coinsurance additional condition and the cost to repair or replace the damaged building property is $2,500 or less. That subparagraph states that the cost of building repairs or replacement does not include the increased cost attributable to enforcement of or compliance with any ordinance or law regulating the construction, use or repair of any property, and that awnings or floor coverings, appliances for refrigerating, ventilating, cooking, dishwashing or laundering, and outdoor equipment or furniture will be valued at actual cash value even when attached to the building.
- Subparagraph E.7.c values Stock the insured has sold but not delivered at the selling price less discounts and expenses the insured otherwise would have had; E.7.d values glass at the cost of replacement with safety-glazing material if required by law; and E.7.e values tenants' improvements and betterments in three branches: at actual cash value if the insured makes repairs promptly; at a proportion of original cost, computed from the days from the loss to the expiration of the lease over the days from installation to that expiration, if it does not; and at nothing if others pay for repairs or replacement.
- Coinsurance appears in section F.1 as an Additional Condition that applies only if a coinsurance percentage is shown in the Declarations.
- The Coinsurance condition states that if one Limit of Insurance applies to two or more separate items, the condition applies to the total of all property to which the limit applies.
- The Coinsurance condition states that the insurer will not pay the full amount of any loss if the value of Covered Property at the time of loss times the coinsurance percentage shown in the Declarations is greater than the Limit of Insurance for the property.
- The Coinsurance condition sets out a calculation that multiplies the value of Covered Property at the time of loss by the coinsurance percentage, divides the Limit of Insurance by that figure, multiplies the total amount of loss before the application of any deductible by the resulting figure, and then subtracts the deductible, and states that the insurer will pay the amount so determined or the Limit of Insurance, whichever is less, and that for the remainder the insured will either have to rely on other insurance or absorb the loss itself.
- Section F Additional Conditions also includes a Mortgageholders condition at F.2, which pays covered loss of or damage to buildings or structures to each mortgageholder shown in the Declarations in their order of precedence, as interests may appear.
- Section G Optional Coverages apply only if shown as applicable in the Declarations and are Agreed Value, Inflation Guard, Replacement Cost, and Extension Of Replacement Cost To Personal Property Of Others.
- The Agreed Value Optional Coverage states that the Additional Condition, Coinsurance, does not apply to Covered Property to which that Optional Coverage applies, that the insurer will pay no more for loss of or damage to that property than the proportion that the Limit of Insurance under the Coverage Part for the property bears to the Agreed Value shown for it in the Declarations, and that if the Agreed Value expiration date shown in the Declarations is not extended, the Coinsurance condition is reinstated and the Optional Coverage expires.
- The Agreed Value Optional Coverage states that its terms apply only to loss or damage occurring on or after its effective date and before the earlier of the Agreed Value expiration date shown in the Declarations or the policy expiration date.
- The Inflation Guard Optional Coverage automatically increases the Limit of Insurance for property to which it applies by the annual percentage shown in the Declarations, and computes the amount of increase as the Limit of Insurance that applied on the most recent of the policy inception date, policy anniversary date or other policy change amending the limit, times the annual percentage shown in the Declarations, times the number of days since that date divided by 365.
- The Replacement Cost Optional Coverage states that Replacement Cost, without deduction for depreciation, replaces Actual Cash Value in the Valuation loss condition of the Coverage Form.
- The Replacement Cost Optional Coverage states that it does not apply to four things: personal property of others; contents of a residence; works of art, antiques or rare articles including etchings, pictures, statuary, marbles, bronzes, porcelains and bric-a-brac; and Stock, unless the Including Stock option is shown in the Declarations.
- The Replacement Cost Optional Coverage states that the insurer will not pay on a replacement cost basis until the lost or damaged property is actually repaired or replaced, and unless the repair or replacement is made as soon as reasonably possible after the loss or damage.
- The Replacement Cost Optional Coverage allows the insured to make a claim on an actual cash value basis and still claim the additional amount that Optional Coverage provides if it notifies the insurer of its intent to do so within 180 days after the loss or damage.
- The Replacement Cost Optional Coverage adds two branches for tenants' improvements and betterments: if the repair-or-replacement conditions are not met, their value is determined as a proportion of original cost as set out in the Valuation loss condition, and the insurer will not pay for loss or damage to them if others pay for repairs or replacement. The same Optional Coverage states that tenants' improvements and betterments are not considered to be the personal property of others under its terms.
- The Extension Of Replacement Cost To Personal Property Of Others Optional Coverage at G.4 may be shown as applicable only if the Replacement Cost Optional Coverage is itself shown as applicable, deletes Paragraph 3.b.(1) of the Replacement Cost Optional Coverage so that the personal-property-of-others carve-out no longer applies, and provides that where an item of personal property of others is subject to a written contract governing the insured's liability for loss or damage to it, valuation of that item is based on the amount for which the insured is liable under that contract, but not to exceed the lesser of the replacement cost of the property or the applicable Limit of Insurance.
- Section A.5 opens with the words Except as otherwise provided before describing where the Coverage Extensions apply.
Published: 2012-10
Active - [2]Causes Of Loss - Special Form CP 10 30 09 17 (ISO)(opens the original record on Insurance Services Office, Inc. (form text); posted as a sample by the New York State Office of General Services)Insurance Services Office, Inc. (form text); posted as a sample by the New York State Office of General ServicesStandards bodyPrimaryJurisdiction USLast checked August 31, 2026Updates: ISO revises the causes of loss forms periodically; state-specific variants exist.ID
iso-cp-10-30-09-17What this source supports (27)
- CP 10 30 09 17 is the Causes Of Loss - Special Form, and it states that when Special is shown in the Declarations, Covered Causes of Loss means direct physical loss unless the loss is excluded or limited in the policy.
- The form is organized into sections A through G: A. Covered Causes Of Loss; B. Exclusions; C. Limitations; D. Additional Coverage - Collapse; E. Additional Coverage - Limited Coverage For Fungus, Wet Rot, Dry Rot And Bacteria; F. Additional Coverage Extensions; and G. Definitions.
- The section B.1 exclusions are lettered a. through h.: Ordinance Or Law; Earth Movement; Governmental Action; Nuclear Hazard; Utility Services; War And Military Action; Water; and Fungus, Wet Rot, Dry Rot And Bacteria.
- The section B.1 exclusions are introduced by language stating that the insurer will not pay for loss or damage caused directly or indirectly by any of the listed causes, and that such loss or damage is excluded regardless of any other cause or event that contributes concurrently or in any sequence to the loss.
- Exclusion B.1.b Earth Movement lists earthquake including tremors and aftershocks and any related earth sinking, rising or shifting; landslide including any related earth sinking, rising or shifting; mine subsidence, meaning subsidence of a man-made mine; earth sinking other than sinkhole collapse, rising or shifting, including soil conditions that cause settling, cracking or other disarrangement of foundations or other parts of realty; and, separately at b.(5), volcanic eruption, explosion or effusion. The words other than sinkhole collapse are part of b.(4), and sinkhole collapse is one of the specified causes of loss defined at G.2 of this form.
- The form states that if Earth Movement as described in b.(1) through (4) results in fire or explosion, the insurer will pay for the loss or damage caused by that fire or explosion.
- The form separately states that if volcanic eruption, explosion or effusion results in fire, building glass breakage or Volcanic Action, the insurer will pay for the loss or damage caused by that fire, building glass breakage or Volcanic Action, and defines Volcanic Action as direct loss or damage resulting from the eruption of a volcano when caused by airborne volcanic blast or airborne shock waves, ash, dust or particulate matter, or lava flow, with all volcanic eruptions within any 168-hour period constituting a single occurrence, and states that Volcanic Action does not include the cost to remove ash, dust or particulate matter that does not cause direct physical loss or damage to the described property.
- Exclusion B.1.b closes with a statement that the exclusion applies regardless of whether any of the causes in Paragraphs (1) through (5) is caused by an act of nature or is otherwise caused.
- Exclusion B.1.c Governmental Action excludes seizure or destruction of property by order of governmental authority, but states that the insurer will pay for loss or damage caused by or resulting from acts of destruction ordered by governmental authority and taken at the time of a fire to prevent its spread, if the fire would be covered under the Coverage Part.
- Exclusion B.1.d Nuclear Hazard excludes nuclear reaction or radiation, or radioactive contamination, however caused, but states that if any of those results in fire, the insurer will pay for the loss or damage caused by that fire.
- The form states that Exclusions B.1.a. through B.1.h. apply whether or not the loss event results in widespread damage or affects a substantial area.
- Exclusion B.1.a Ordinance Or Law excludes the enforcement of or compliance with any ordinance or law regulating the construction, use or repair of any property, or requiring the tearing down of any property including the cost of removing its debris, and states that it applies whether the loss results from an ordinance enforced even if the property has not been damaged or from increased costs incurred to comply with an ordinance in the course of construction, repair, renovation, remodeling or demolition of property or removal of its debris following a physical loss.
- Exclusion B.1.e Utility Services excludes the failure of power, communication, water or other utility service supplied to the described premises, however caused, where the failure originates away from the described premises or originates at the premises but involves equipment used to supply the utility service from a source away from the premises, and also excludes loss caused by a surge of power that would not have occurred but for an event causing a failure of power, with a stated exception where the failure or surge results in a Covered Cause of Loss. The form adds that failure of any utility service includes lack of sufficient capacity and reduction in supply, and that communication services include but are not limited to service relating to Internet access or access to any electronic, cellular or satellite network.
- Of exclusions B.1.c through B.1.f, three carry a stated exception in the form text: Governmental Action at B.1.c, Nuclear Hazard at B.1.d and Utility Services at B.1.e. Exclusion B.1.f War And Military Action, which lists war including undeclared or civil war, warlike action by a military force, and insurrection, rebellion, revolution, usurped power or action taken by governmental authority in hindering or defending against any of these, carries no stated exception in this form.
- Exclusion B.1.g Water excludes flood, surface water, waves including tidal wave and tsunami, tides, tidal water, overflow of any body of water, or spray from any of these, whether or not driven by wind including storm surge; mudslide or mudflow; water that backs up or overflows or is otherwise discharged from a sewer, drain, sump, sump pump or related equipment; water under the ground surface pressing on or flowing or seeping through foundations, walls, floors, paved surfaces, basements, doors, windows or other openings; and waterborne material carried or moved by that water or by mudslide or mudflow. The form states the exclusion applies regardless of whether any of Paragraphs (1) through (5) is caused by an act of nature or is otherwise caused, and gives the failure of a dam, levee, seawall or other boundary or containment system as an example. Its exception reads that if any of Paragraphs (1) through (5) results in fire, explosion or sprinkler leakage, the insurer will pay for the loss or damage caused by that fire, explosion or sprinkler leakage, followed by the parenthetical qualifier if sprinkler leakage is a Covered Cause of Loss.
- Exclusion B.1.h excludes presence, growth, proliferation, spread or any activity of fungus, wet or dry rot or bacteria, states that if those result in a specified cause of loss the insurer will pay for the loss caused by that specified cause of loss, and states that the exclusion does not apply where the fungus, wet or dry rot or bacteria result from fire or lightning, or to the extent coverage is provided in the Additional Coverage at section E with respect to loss or damage by a cause of loss other than fire or lightning.
- Exclusion B.2.d runs d.(1) through d.(7): (1) wear and tear; (2) rust or other corrosion, decay, deterioration, hidden or latent defect or any quality in property that causes it to damage or destroy itself; (3) smog; (4) settling, cracking, shrinking or expansion; (5) nesting or infestation, or discharge or release of waste products or secretions, by insects, birds, rodents or other animals; (6) mechanical breakdown, including rupture or bursting caused by centrifugal force; and (7) dampness or dryness of atmosphere, changes in or extremes of temperature, and marring or scratching, each stated as causes of loss to personal property.
- Exclusion B.2.d.(6) states that if mechanical breakdown results in elevator collision, the insurer will pay for the loss or damage caused by that elevator collision.
- Paragraph B.2.d closes with a general exception: if an excluded cause of loss listed in 2.d.(1) through (7) results in a specified cause of loss or building glass breakage, the insurer will pay for the loss or damage caused by that specified cause of loss or building glass breakage.
- Exclusion B.2.h excludes dishonest or criminal act, including theft, by the named insured, its partners, members, officers, managers, employees including temporary employees and leased workers, directors, trustees or authorized representatives, whether acting alone or in collusion with each other or with any other party, and separately excludes theft by any person to whom the insured entrusts the property for any purpose, whether acting alone or in collusion with any other party.
- Exclusion B.2.h states that it applies whether or not an act occurs during the insured's normal hours of operation, and that it does not apply to acts of destruction by the insured's employees, including temporary employees and leased workers, or authorized representatives, but that theft by those same people is not covered.
- Exclusion B.2.m excludes neglect of an insured to use all reasonable means to save and preserve property from further damage at and after the time of loss.
- Section B.3 excludes weather conditions where they contribute in any way with a cause or event excluded in Paragraph B.1 to produce the loss; acts or decisions, including the failure to act or decide, of any person, group, organization or governmental body; and faulty, inadequate or defective planning, zoning, development, surveying, siting, design, specifications, workmanship, repair, construction, renovation, remodeling, grading, compaction, materials used in repair, construction, renovation or remodeling, or maintenance. Section B.3 states that if an excluded cause of loss listed in 3.a. through 3.c. results in a Covered Cause of Loss, the insurer will pay for the loss or damage caused by that Covered Cause of Loss.
- Section D Additional Coverage - Collapse states that the coverage applies only to an abrupt collapse as described and limited in D.1 through D.7, and that it will not increase the Limits of Insurance provided in the Coverage Part.
- Section E Additional Coverage - Limited Coverage For Fungus, Wet Rot, Dry Rot And Bacteria applies only where the fungus, wet or dry rot or bacteria result from a specified cause of loss other than fire or lightning, or from flood if the Flood Coverage Endorsement applies to the affected premises, occurring during the policy period, and only if all reasonable means were used to save and preserve the property from further damage at the time of and after that occurrence. The coverage described at E.2 is limited to $15,000 as the most the insurer will pay for the total of all such loss or damage taking place in a 12-month period, and the Limited Coverage does not increase the applicable Limit of Insurance on any Covered Property.
- Section F Additional Coverage Extensions of this form are 1. Property In Transit, 2. Water Damage, Other Liquids, Powder Or Molten Material Damage, and 3. Glass.
- Section G Definitions of this form contains exactly two defined terms: 1. Fungus and 2. Specified causes of loss. There is no defined term Water in this form, and water damage is defined only inside the Specified causes of loss definition at G.2.c. Volcanic Action is defined in the body of exclusion B.1.b rather than in Section G.
Published: 2017-09
Active - [3]Business Income (And Extra Expense) Coverage Form CP 00 30 10 12 (ISO)(opens the original record on Insurance Services Office, Inc. (form text); posted in the Property Insurance Coverage Law Blog forms library (Merlin Law Group))Insurance Services Office, Inc. (form text); posted in the Property Insurance Coverage Law Blog forms library (Merlin Law Group)Standards bodyPrimaryJurisdiction USLast checked August 31, 2026Updates: ISO revises the commercial property program periodically; later editions exist and the waiting period and optional coverage structure can differ by edition, state variant, or carrier form.ID
iso-cp-00-30-10-12What this source supports (13)
- CP 00 30 10 12 is the Business Income (And Extra Expense) Coverage Form, a separate commercial property coverage form from the Building And Personal Property Coverage Form.
- The form defines Business Income as the Net Income, meaning net profit or loss before income taxes, that would have been earned or incurred, plus continuing normal operating expenses incurred, including payroll, and states that for manufacturing risks Net Income includes the net sales value of production.
- The form states that the insurer will pay for the actual loss of Business Income the insured sustains due to the necessary suspension of its operations during the period of restoration, and that the suspension must be caused by direct physical loss of or damage to property at premises described in the Declarations for which a Business Income Limit Of Insurance is shown, with the loss or damage caused by or resulting from a Covered Cause of Loss.
- Extra Expense means necessary expenses the insured incurs during the period of restoration that it would not have incurred if there had been no direct physical loss or damage to property caused by or resulting from a Covered Cause of Loss.
- Period of restoration begins 72 hours after the time of direct physical loss or damage for Business Income Coverage and immediately after the time of direct physical loss or damage for Extra Expense Coverage.
- Period of restoration ends on the earlier of the date when the property at the described premises should be repaired, rebuilt or replaced with reasonable speed and similar quality, or the date when business is resumed at a new permanent location.
- Period of restoration does not include any increased period required due to the enforcement of or compliance with any ordinance or law that regulates the construction, use or repair, or requires the tearing down, of any property.
- Suspension means the slowdown or cessation of the insured's business activities, or that a part or all of the described premises is rendered untenantable, where Rental Value coverage applies.
- The form contains its own Coinsurance Additional Condition, which applies if a coinsurance percentage is shown in the Declarations and measures adequacy against the coinsurance percentage times the sum of Net Income and operating expenses including payroll that would have been earned or incurred for the 12 months following the inception or last previous anniversary date of the policy, whichever is later.
- The Business Income coinsurance calculation multiplies that 12-month net income and operating expense figure by the coinsurance percentage, divides the Limit of Insurance by that figure, and multiplies the total amount of loss by the resulting figure, paying the lesser of that result or the limit of insurance.
- The form's Optional Coverages are Maximum Period Of Indemnity, Monthly Limit Of Indemnity, Business Income Agreed Value, and Extended Period Of Indemnity.
- The Maximum Period Of Indemnity and Monthly Limit Of Indemnity Optional Coverages each state that the Additional Condition, Coinsurance, does not apply.
- Business Income coverage may be written as Business Income Including Rental Value, or as Rental Value only, depending on which option is selected in the Declarations.
Published: 2012-10
Active - [4]Commercial General Liability Coverage Form CG 00 01 04 13 (ISO)(opens the original record on Insurance Services Office, Inc. (form text); published as a downloadable coverage form specimen by Berxi (Berkshire Hathaway Specialty Insurance))Insurance Services Office, Inc. (form text); published as a downloadable coverage form specimen by Berxi (Berkshire Hathaway Specialty Insurance)Standards bodyPrimaryJurisdiction USLast checked August 31, 2026Updates: ISO revises the CGL coverage form periodically; edition dates and state-specific variants differ, and carriers may use their own non-ISO forms.ID
iso-cg-00-01-04-13What this source supports (37)
- In CG 00 01 04 13, the Coverage A insuring agreement states that the insurer will pay those sums that the insured becomes legally obligated to pay as damages because of bodily injury or property damage to which the insurance applies, and that the insurer will have the right and duty to defend the insured against any suit seeking those damages.
- The form states that the insurer will have no duty to defend the insured against any suit seeking damages for bodily injury or property damage to which the insurance does not apply.
- The form states that the insurer's right and duty to defend ends when it has used up the applicable limit of insurance in the payment of judgments or settlements under Coverages A or B or medical expenses under Coverage C.
- Coverage A applies to bodily injury and property damage only if the injury or damage is caused by an occurrence that takes place in the coverage territory and occurs during the policy period, subject to the form's prior-knowledge provisions.
- The form defines occurrence as an accident, including continuous or repeated exposure to substantially the same general harmful conditions.
- Supplementary Payments under Coverages A and B include all expenses the insurer incurs, and the form states that these payments will not reduce the limits of insurance.
- Section III Limits Of Insurance sets a General Aggregate Limit, a Products-Completed Operations Aggregate Limit, a Personal And Advertising Injury Limit, an Each Occurrence Limit, a Damage To Premises Rented To You Limit, and a Medical Expense Limit.
- The General Aggregate Limit is the most the insurer will pay for the sum of medical expenses under Coverage C, damages under Coverage A other than damages included in the products-completed operations hazard, and damages under Coverage B.
- The Products-Completed Operations Aggregate Limit is the most the insurer will pay under Coverage A for damages because of bodily injury and property damage included in the products-completed operations hazard.
- The Each Occurrence Limit is the most the insurer will pay for the sum of damages under Coverage A and medical expenses under Coverage C because of all bodily injury and property damage arising out of any one occurrence.
- The Damage To Premises Rented To You Limit, subject to the Each Occurrence Limit, is the most the insurer will pay under Coverage A for damages because of property damage to any one premises while rented to the insured, or in the case of damage by fire, while rented to or temporarily occupied by the insured with permission of the owner.
- The Medical Expense Limit, subject to the Each Occurrence Limit, is the most the insurer will pay under Coverage C for all medical expenses because of bodily injury sustained by any one person.
- The form states that the Limits of Insurance of the Coverage Part apply separately to each consecutive annual period and to any remaining period of less than 12 months, starting with the beginning of the policy period shown in the Declarations.
- The Coverage A exclusions in CG 00 01 04 13 are lettered a. through q.: Expected Or Intended Injury; Contractual Liability; Liquor Liability; Workers' Compensation And Similar Laws; Employer's Liability; Pollution; Aircraft, Auto Or Watercraft; Mobile Equipment; War; Damage To Property; Damage To Your Product; Damage To Your Work; Damage To Impaired Property Or Property Not Physically Injured; Recall Of Products, Work Or Impaired Property; Personal And Advertising Injury; Electronic Data; and Recording And Distribution Of Material Or Information In Violation Of Law.
- The Coverage A list of exclusions in this base form does not include a professional services exclusion.
- Exclusion b. Contractual Liability removes bodily injury or property damage for which the insured is obligated to pay damages by reason of the assumption of liability in a contract or agreement, and states that the exclusion does not apply to liability for damages that the insured would have in the absence of the contract or agreement, or to liability assumed in a contract or agreement that is an insured contract, provided the bodily injury or property damage occurs subsequent to the execution of the contract or agreement.
- The form defines insured contract to include a contract for a lease of premises with a stated fire-damage carve-out, a sidetrack agreement, an easement or license agreement with a stated railroad exception, an obligation required by ordinance to indemnify a municipality with a stated exception, an elevator maintenance agreement, and that part of any other contract or agreement pertaining to the insured's business under which the insured assumes the tort liability of another party to pay for bodily injury or property damage to a third person or organization.
- Nothing in the Contractual Liability exclusion or its insured contract exception amends Section II Who Is An Insured or confers additional insured status.
- Coverage A exclusion a. Expected Or Intended Injury states, in the same paragraph, that the exclusion does not apply to bodily injury resulting from the use of reasonable force to protect persons or property.
- The insured contract exception in exclusion b. also provides that, solely for the purposes of liability assumed in an insured contract, reasonable attorneys' fees and necessary litigation expenses incurred by or for a party other than an insured are deemed to be damages because of bodily injury or property damage, provided liability for that party's defense was also assumed in the same insured contract and the fees and expenses are for defense of that party against a civil or alternative dispute resolution proceeding in which damages to which the insurance applies are alleged.
- Coverage A exclusion c. Liquor Liability removes bodily injury or property damage for which any insured may be held liable by reason of causing or contributing to the intoxication of any person, the furnishing of alcoholic beverages to a person under the legal drinking age or under the influence of alcohol, or any statute, ordinance or regulation relating to the sale, gift, distribution or use of alcoholic beverages.
- The Liquor Liability exclusion states that it applies even if the claims allege negligence or other wrongdoing in the supervision, hiring, employment, training or monitoring of others by that insured, or in providing or failing to provide transportation with respect to any person that may be under the influence of alcohol, if the occurrence involved one of the three listed grounds.
- The Liquor Liability exclusion closes with a limiting clause stating that the exclusion applies only if the named insured is in the business of manufacturing, distributing, selling, serving or furnishing alcoholic beverages, and that permitting a person to bring alcoholic beverages on the named insured's premises for consumption on those premises, whether or not a fee is charged or a license is required for that activity, is not by itself considered the business of selling, serving or furnishing alcoholic beverages.
- Coverage A exclusion e. Employer's Liability reaches bodily injury to an employee of the insured arising out of and in the course of employment by the insured or of performing duties related to the conduct of the insured's business, and to that employee's spouse, child, parent, brother or sister as a consequence, and applies whether the insured may be liable as an employer or in any other capacity and to any obligation to share damages with or repay someone else. The form then states that the exclusion does not apply to liability assumed by the insured under an insured contract.
- Coverage A exclusion f. Pollution excludes bodily injury or property damage arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of pollutants at or from premises the insured owns, occupies, rents or borrows, and at or from premises where the insured or its contractors are performing operations if the pollutants are brought on in connection with those operations, subject to stated subparagraph exceptions.
- One stated exception to the pollution exclusion is bodily injury sustained within a building and caused by smoke, fumes, vapor or soot produced by or originating from equipment used to heat, cool or dehumidify the building.
- Exclusion f.(2) also excludes loss, cost or expense arising out of a request, demand, order or statutory or regulatory requirement that any insured or others test for, monitor, clean up, remove, contain, treat, detoxify or neutralize pollutants, or a claim or suit by or on behalf of a governmental authority for such damages.
- Exclusion f.(2) closes with a stated exception providing that the paragraph does not apply to liability for damages because of property damage that the insured would have in the absence of such request, demand, order or statutory or regulatory requirement, or of such claim or suit by or on behalf of a governmental authority.
- Coverage A exclusion k. Damage To Your Product removes property damage to the insured's product arising out of it or any part of it, and carries no stated exception in this form.
- Coverage A exclusion l. Damage To Your Work removes property damage to the insured's work arising out of it or any part of it and included in the products-completed operations hazard, and states that the exclusion does not apply if the damaged work, or the work out of which the damage arises, was performed on the named insured's behalf by a subcontractor.
- Coverage A exclusion m. Damage To Impaired Property Or Property Not Physically Injured removes property damage to impaired property or to property that has not been physically injured arising out of a defect, deficiency, inadequacy or dangerous condition in the insured's product or work, or out of a delay or failure by the insured or anyone acting on its behalf to perform a contract or agreement in accordance with its terms, and states that the exclusion does not apply to the loss of use of other property arising out of sudden and accidental physical injury to the insured's product or work after it has been put to its intended use.
- Coverage A exclusion n. Recall Of Products, Work Or Impaired Property removes damages claimed for any loss, cost or expense incurred by the insured or others for the loss of use, withdrawal, recall, inspection, repair, replacement, adjustment, removal or disposal of the insured's product, work or impaired property, and applies only if such product, work or property is withdrawn or recalled from the market or from use by any person or organization because of a known or suspected defect, deficiency, inadequacy or dangerous condition in it.
- Coverage A exclusion p. Electronic Data removes damages arising out of the loss of, loss of use of, damage to, corruption of, inability to access or inability to manipulate electronic data, and states in the same paragraph that the exclusion does not apply to liability for damages because of bodily injury.
- Coverage A exclusion i. War excludes bodily injury or property damage arising directly or indirectly out of war including undeclared or civil war, warlike action by a military force, and insurrection, rebellion, revolution, usurped power or action taken by governmental authority in hindering or defending against any of these.
- Coverage A exclusion q. excludes bodily injury or property damage arising directly or indirectly out of any action or omission that violates or is alleged to violate the Telephone Consumer Protection Act, the CAN-SPAM Act of 2003, the Fair Credit Reporting Act including the Fair and Accurate Credit Transactions Act amendment, or any other similar statute, ordinance or regulation.
- Section III Limits Of Insurance in this base form sets limits only and contains no liability deductible provision.
- Coverage B is Personal And Advertising Injury Liability, has its own limit of insurance and its own exclusions including a pollution exclusion, and Coverage C is Medical Payments, whose payments are made regardless of fault and cannot exceed the applicable limit of insurance.
Published: 2013-04
Active - [5]Commercial Insurance Guide (CDI Form 700)(opens the original record on California Department of Insurance)California Department of InsuranceRegulatorPrimaryJurisdiction CALast checked August 31, 2026Updates: revised by the California Department of Insurance without a fixed schedule; the page carries the marker Form 700 Revised June 14, 2024ID
ca-cdi-commercial-insurance-guideWhat this source supports (33)
- The guide's glossary entry headed 'Claims Made' reads: a liability insurance policy where coverage applies to claims filed during the policy period no matter when the loss occurred subject to a retroactive inception date.
- The guide's glossary entry headed 'Occurrence' reads: a liability insurance policy that covers claims arising out of occurrences that take place during the policy period, regardless of when the claim is filed.
- CDI states that there are three primary coverage sections that make up a CGL policy: premises liability, products liability and completed operations.
- CDI describes CGL coverage as comprehensive in nature, covering all hazards within the scope of the insuring agreement that are not otherwise excluded.
- CDI states that the major exclusions under a CGL policy include intentional injury; insured contracts; liquor liability; workers compensation and employers liability; pollution; aircraft; automobile; watercraft; mobile equipment; war; care, custody, and control; damage to your work; impaired property; sistership liability; and failure to perform.
- CDI describes specified perils as consisting of a list of each peril to be insured against, such as fire, explosion, windstorm and vandalism, and describes open perils coverage as covering all losses unless they are specifically excluded.
- CDI states that earth movement (including earthquake) and flood are two common perils that are excluded under open perils coverage.
- CDI describes three commercial property valuation approaches: actual cash value, agreed value, which it says waives any coinsurance penalty and pays 100 percent of the stated amount, and replacement cost, which it describes as the amount it takes to replace property with new property of like kind and quality up to the limits of insurance.
- CDI describes coinsurance as an insurance clause that defines the amount of each loss the company pays according to the amount of insurance carried divided by the amount of insurance required, and states that a policyholder can be subject to a monetary penalty at the time of a loss where a building is not insured to value.
- CDI states that business interruption coverage replaces lost business income after a covered loss.
- CDI describes a Business Owners Policy (BOP) as a combination commercial policy that covers property, general liability and business interruption.
- CDI states that when a business has had three applications turned down from a licensed commercial insurance carrier, with written documentation of the declination, it can proceed to obtain insurance from the surplus line market.
- CDI states that a surplus line company can only be accessed through a specially licensed broker who holds a surplus line license issued by the CDI.
- CDI states that although surplus line insurers must follow the Fair Claims Settlement Practices Regulations, the CDI has limited jurisdiction over the operation of surplus line insurers.
- CDI states that the California Insurance Guarantee Association (CIGA), which protects claims with admitted insurers, does not apply to surplus line insurers.
- There are three primary coverage sections that make up a CGL policy: premises liability, products liability and completed operations.
- Premises liability covers liability for accidental injury or property damage that results from either a condition on your premises or your operations in progress, whether on or away from your premises.
- A products liability hazard exists for any business that manufactures, sells, handles, or distributes goods or products.
- Completed operations covers your potential liability for bodily injury or property damage that arises out of your completed work.
- The CGL policy has separate limits of insurance for general liability, fire legal liability, products and completed operations liability, advertising and personal liability, and medical payments.
- The page carries the line Form 700 Revised June 14, 2024.
- The guide states that inland marine is a specialized type of property insurance that primarily covers damage to or destruction of your business property while in transport.
- The guide states that inland marine insurance can cover a variety of transportation exposures, however it does not cover boating transportation, which is covered under ocean marine insurance.
- The guide states that some of the most common types of coverage offered are accounts receivable insurance, consignment insurance, equipment floaters (i.e., contractors equipment), installation floaters, motor truck cargo insurance, trip transit insurance, and valuable papers (records) insurance.
- The guide states that standard perils in inland marine may include fire, lightning, windstorm, flood, earthquake, landslide, theft, collision, derailment, overturn of the transporting vehicle, and bridge collapse.
- The guide states that commercial property insurance can protect a business owner from some of the most common losses experienced by business owners, such as property damage, business interruption, theft, liability, and worker injury.
- The guide states that an aggregate limit of liability is in force for the general liability, fire legal liability, advertising and personal liability, and medical payments claims.
- The guide states that when total claims for all these areas exceed a stated annual aggregate limit of liability, the policy limits are exhausted and no more claims will be paid from the policy for the duration of the policy period.
- The guide states that there is also a separate aggregate limit of liability in force for products and completed operations liability claims.
- The guide defines split limits as the technique for expressing limits of liability coverage under a particular insurance policy by stating separate limits for different types of claims growing out of a single event or combination of events.
- The guide states that if a building is not insured to value the insured can be subject to a monetary penalty at the time of a loss, commonly referred to as coinsurance, and defines coinsurance as an insurance clause that defines the amount of each loss that the company pays according to the amount of insurance carried, divided by the amount of insurance required.
- The guide states that the California Insurance Guarantee Association (CIGA), which protects claims with admitted insurers, does not apply to surplus line insurers.
- The guide states that while surplus line companies are not licensed by the CDI, they do have to go through an approval process that includes providing evidence of minimum capital and surplus requirements.
Fetched 2026-08-31 and both glossary entries read off the page. The '?page=3' query parameter used in the earlier draft is inert and has been dropped from the URL. publishedDate is taken from the page's own 'Form 700 Revised June 14, 2024' marker. This is a consumer guide glossary and the weakest authority in the bundle; it is cited only for the two trigger definitions. It does not address retroactive dates, extended reporting periods, or which lines are written on which trigger. Published: 2024-06-14 Effective: 2024-06-14
Active - [6]California Insurance Code Section 530(opens the original record on California Legislative Information (California Legislature))California Legislative Information (California Legislature)Primary lawPrimaryJurisdiction CALast checked August 31, 2026Updates: Enacted by Stats. 1935, Ch. 145; verify current text at leginfo.ID
ca-ins-code-530What this source supports (1)
- Insurance Code section 530 states that an insurer is liable for a loss of which a peril insured against was the proximate cause, although a peril not contemplated by the contract may have been a remote cause of the loss, but is not liable for a loss of which the peril insured against was only a remote cause.
Published: 1935-01-01
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