We are reviewing the date coverage is triggered under the civil authority extension of the CP0030 (Additional Coverages, a. Civil Authority) under the following circumstances:

An insured business is closed on 10/5 due to a mandatory evacuation ordered by civil authority. Actual damage occurs within a mile of the insured location preventing access to the property on 10/8, at which time the civil authority issues a notice that the area surrounding the insured location is to remain evacuated. For this example we are assuming no direct damage occurred to the insured property.

Our current interpretation of the language is the civil authority extension is triggered on 10/8 when the damage occurs within a mile of the insured property, preventing access, and therefore damage and the 72 hours begin at that time.

The policy states: Civil Authority Coverage for Business Income will being 72 hours after the time of the first action of civil authority….

In this case, the first action of civil authority began before coverage was triggered.

Would the 72 hours begin at the time of the evacuation and before the physical damage, or would it begin at the time when coverage is triggered and the physical damage occurs?

Florida Subscriber

You are correct that while the first evacuation was ordered 10/5, coverage is not extended until 10/8 when the evacuation was related to actual damage to property away from the premises. That is the first time action of the civil authority related to actual property damage, which is the trigger you need for the coverage, even though an evacuation was ordered earlier. You need to go by actual damage. The 72 hours begins at the time of the evacuation related to damage, which was 10/8.

This premium content is locked for FC&S Coverage Interpretation Subscribers

Enjoy unlimited access to the trusted solution for successful interpretation and analyses of complex insurance policies.

  • Quality content from industry experts with over 60 years insurance experience, combined
  • Customizable alerts of changes in relevant policies and trends
  • Search and navigate Q&As to find answers to your specific questions
  • Filter by article, discussion, analysis and more to find the exact information you’re looking for
  • Continually updated to bring you the latest reports, trending topics, and coverage analysis