Our commercial property insured is covered on a CP 00 10 04 02 with a blanket limit of $5.6 million on the building. While we intended to cover both the building and business personal property under this blanket limit, it appears that the insurer did not issue the policy that way. There has been a large fire in which the building and business personal property were destroyed. The insurer has refused to pay for any of the business personal property, because the policy does not indicate it as covered. The $5.6 million is way too much coverage for the building only. It is obviously enough to cover both the building and the personal property.

Is there anything we can do in this case to get the loss paid for our insured?

Florida Subscriber

Your client has no coverage for his business personal property the way the policy was written. The Declarations of his commercial property policy clearly indicates building coverage only.

The insuring agreement of form CP 00 10 says that it covers "the following types of property for which a Limit of Insurance is shown in the Declarations." It then lists the three categories of: building; business personal property; and personal property of others. Since the only category for which a limit is shown is the building, that is the only item of property covered by this policy.

However, since it appears that the limit of insurance, $5.6 million, would be enough to cover the building and contents in the event of a total loss that may indicate the intent to cover both under the blanket amount. You should review the application and your notes from conversations with the insured and the underwriter. You should also go over the pricing of the insured's risk exposures with the underwriter.

It may turn out that the omission of business personal property from the Declarations was just a mistake. If it was and the insured paid for building and contents coverage, there's a good chance that he can collect for both.

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