Lawyers who handle commercial insurance claims can tell you that the most common type of commercial property insurance is the Building & Personal Property Coverage Form.
The Building & Personal Property (BPP) coverage form is the most commonly used policy to insure commercial buildings and contents. Covered perils for the BPP are listed in separate cause-of-loss forms.
The BPP generally covers:
The Insured Building — a specific description of each insured building is ordinarily contained in the declarations page of the policy
Business Personal Property — Business personal property includes furniture and fixtures, machinery and equipment, stock, materials, and other owned or leased personal property under the care, custody or control of the insured
Personal Property of Others — The BPP also provides basic coverage for property of third parties in the insured’s care, custody or control. An insured who performs commercial bailments usually purchases increased limits for loss or damage to the personal property of others.
The BPP excludes claims for loss or damage to land, water, bridges, roadways, and underground pipes or drains. The policy also excludes any loss to plants, crops, trees, and shrubs. The policy also excludes loss to certain types of personal property, including deeds, instruments, money, accounts, bills, and securities. The policy also excludes loss to vehicles, watercraft, and aircraft unless specifically named as insured property. An insured who wishes to obtain insurance coverage on the aforementioned types of property can obtain such coverage through other insuring agreements.
The limits of insurance expressed in the BPP apply separately to each occurrence except for a small number of additional coverages specified in the policy. None of the BPP coverage is subject to an aggregate limit capping the amount recoverable under that coverage during each policy year.
One thing to keep in mind is that the insurance company is not obligated to pay anything to the insured unless the loss exceeds the applicable deductible. The limit of insurance that applies to the loss is in excess of the deductible.