Costly claim involves multiple deductibles

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Question: This question involves a building insured for $1,239,000.

A Business Personal Property (BPP) policy is for $100,000. There is a named storm percentage deductible of 3%, with $15,000 minimum per location per attached the named storm deductible endorsement. The building deductible would thus be $37,170.

Damage to the building is approximately $25,000, so the loss does not exceed the deductible. Damage to the BPP is approximately $5,000.

Based on the endorsement language, which states that separate deductibles apply to both the building and personal property, should the deductible for the BPP be $3,000, or the residual of the building deductible?

The insured has a business income loss, as well, under a commercial insurance policy (form CP 00 30 10 12). A 72-hour waiting period applies to it separately from the building deductible, correct?

Thank you.

— Washington, D.C. subscriber

Answer: Since the deductible endorsement clearly states that the deductible applies separately to each building and personal property, the deductible for the BPP will be $3,000, and not the residual of the building deductible. You are correct that the 72-hour waiting deductible for the business income is a separate deductible that applies to that coverage.

See also:

• Will business income insurance cover these 7 losses?
• It’s business, it’s not personal (property)
• How to navigate a business income loss claim