Does Coinsurance Clause Apply to the BPP and Business Income

[Nezha]

I am quoting an BOP without covering the building itself, from Guard company. The coverage form is attached. In the quote, under the BPP amount there shows "Replacement Cost".

I have read the form and found coinsurance clause 80% for the building itself, but nowhere to mention BPP and related business income.

No one from Guard company would like to "advise the coverage". So if any master here knows the answer?

 

[Al3x Lee]

Usually the coinsurance clause applies to all property on commercial policies. BPP and business income are property coverages, so generally, yes, the coinsurance clause applies to these.

Do you have a full list of forms? I don't see anything in the document provided that specifies this, but it should be outlined in one of the policy forms.

 

[adjusterjack]

If you are referring to the "Loss Payment" section starting on Page 21, the 80% requirement applies to loss to property and doesn't distinguish between building and contents. Caution your client that "contents" or "business personal property" should also include any improvements and betterments that he has made to the building.

Business Income (starting on Page 6) is an "actual loss" coverage subject the amount of coverage you buy which is, in turn, subject to the calculations required by the coverage part. Also see "Resumption of Operations" on Page 23.

A Business Income claim involves financial calculations. Check out the resources in the following search results for an understanding of the "how to do."

calculating a business income claim at DuckDuckGo

 

[Nezha]

Usually the coinsurance clause applies to all property on commercial policies. BPP and business income are property coverages, so generally, yes, the coinsurance clause applies to these.

Do you have a full list of forms? I don't see anything in the document provided that specifies this, but it should be outlined in one of the policy forms.

It's in the attachment. I am sure if I did it right. I will upload again.

If you are referring to the "Loss Payment" section starting on Page 21, the 80% requirement applies to loss to property and doesn't distinguish between building and contents. Caution your client that "contents" or "business personal property" should also include any improvements and betterments that he has made to the building.

Business Income (starting on Page 6) is an "actual loss" coverage subject the amount of coverage you buy which is, in turn, subject to the calculations required by the coverage part. Also see "Resumption of Operations" on Page 23.

A Business Income claim involves financial calculations. Check out the resources in the following search results for an understanding of the "how to do."

calculating a business income claim at DuckDuckGo

If the BPP is underinsured, and the coinsurance clause applies, in this situation, does the coinsurance clause apply to the business income? (I tried to read as much document as I can...)

 

[MIGA1626]

I still don't understand coinsurance..... I should have finished college....

 

[Nezha]

I still don't understand coinsurance..... I should have finished college....

Read is the only way...

 

[adjusterjack]

I thought I explained it quite clearly.

I guess I'd better dumb it down more.

If the BPP is underinsured, and the coinsurance clause applies, in this situation, does the coinsurance clause apply to the business income?

No.

Wait, this bothers me.

If the BPP is underinsured

Are you quoting ONLY the Business Personal Property or the Business Personal Property AND Business Income?

In other words, a limit for the BPP and a separate limit for the Business Income?

 

[Al3x Lee]

Situations like this are why we keep Jack around and pay him the big bucks

 

[Nezha]

I thought I explained it quite clearly.

I guess I'd better dumb it down more.



No.

Wait, this bothers me.



Are you quoting ONLY the Business Personal Property or the Business Personal Property AND Business Income?

In other words, a limit for the BPP and a separate limit for the Business Income?

If a policy includes BPP coverage, them the business income always comes with it.
So far I haven't seen a separate business income policy.

 

[Nezha]

Situations like this are why we keep Jack around and pay him the big bucks

You are right. Jack is adjuster, he is the best one to help us.
Because the staff including the UW from a insurance company often say "We don't advise the coverage. It's up to the adjuster to determine."