The property coverage parts state what property is covered and what is excluded and set forth any other provisions peculiar to the type of insurance being provided. Similarly, the time element coverage parts describe the particular time element being insured (income, earnings, etc.), and provisions specific to that coverage, such as the special coinsurance clause relating to income insurance.

The perils parts have as their sole purpose the naming of perils covered and excluded. The following perils parts are available: fire; basic, broad, special, and earthquake. This article examines the special form perils.

The following discussion describes the general features of the building and personal property coverage part.

Topics covered:

Eligibility

Insuring agreement and covered property

Property excluded and limitations

Additional coverages

Perils

Supplemental coverages

Loss conditions

Valuation

How much we pay

Loss payment

Commercial property coverage conditions, CP-100

Other conditions

Common policy conditions

Eligibility

 Mercantile, warehousing, nonmanufacturing, and habitational risks are eligible for coverage under the program. Habitational risks include apartment houses and mercantiles, boarding houses, convents and monasteries, dormitories, fraternity and sorority houses, dwellings, lodging and rooming houses, nurses homes, and orphanages. Processors, manufacturers, and farm operations are ineligible.

 Insuring Agreement and Covered Property

 We cover direct physical loss to covered property at the premises described on the declarations caused by a covered peril.

PROPERTY COVERED

We cover the following types of property for which a limit is shown on the declarations.

BUILDING PROPERTY

This means buildings and structures described on the declarations, including:

1.completed additions;

2.fixtures, machinery, and equipment which are a permanent part of the described building or structure;

3.outdoor fixtures;

4.personal property owned by you and used to maintain or service the described building or structure or its premises, including air-conditioning equipment; fire extinguishing apparatus; floor coverings; and appliances for refrigerating, cooking, dish washing, and laundering;

5.if not covered by other insurance;

a.additions under construction, alterations, and repairs to the building or structure; and

b.materials, equipment, supplies, and temporary structures, on or within 100 feet of the described premises, used for making additions, alterations, or repairs to the building or structure.

BUSINESS PERSONAL PROPERTY

This means your business personal property in the buildings and structures described on the declarations or in the open (or in vehicles) on or within 100 feet of the described premises. Unless otherwise specified on the declarations, this includes:

1.your interest in personal property of others to the extent of your labor, material, and services;

2.your use interest as tenant in improvements to the described building or structure. Improvements are fixtures, alterations, installations, or additions:

a.to a building or structure you occupy but do not own; and

b.made or acquired at your expense and which cannot be legally removed by you; and

3.leased personal property which you have a contractual responsibility to insure, unless otherwise insured by the Commercial Property Coverage under Personal Property of Others.

PERSONAL PROPERTY OF OTHERS

This means personal property of others:

1.that is in your care, custody, or control; and

2.located in the buildings and structures described on the declarations or in the open (or in vehicles) on or within 100 feet of the described premises.

However, our payment for loss to personal property of others is only for the benefit of the owners of the personal property.

 Analysis

 While the language of the AAIS form is very similar to the ISO CP 00 10 10 12, it is simpler in the area of business personal property. While the ISO form lists various categories of business personal property, the AAIS form simply promises to pay for damage to such property, without spelling out things like furniture, fixtures, and equipment.

 Property Excluded and Limitations

 PROPERTY EXCLUDED AND LIMITATIONS