An Introduction to the Commercial Package Policy
A Commercial Package Policy (CPP) is an insurance policy that combines coverage for multiple perils, such as liability and property risk. A Commercial Package Policy, or C.P.P., enables a business to take a flexible approach to obtaining insurance coverage. It also may even allow the business to pay a lower premium than it would if it had purchased a separate policy for each risk.
Insurance companies typically write Commercial Package Policies for small or mid-sized businesses. These types of businesses may have smaller liability needs because they do not have larger operations and locations. Additionally, they may only require additional insurance protection for small risks. For example, a manufacturing company or convenience store is less likely to require the same amount of coverage that a real estate development firm might require.
Commercial Package Policies afford a business a much higher degree of tailoring. It also combines multiple coverages into single policies. Additionally, property and liability coverages may also provide coverage for automobile, inland marine, crime, or other risks. The premium would depend on the risks that are being covered, and the types coverages being combined.
This Commercial Package Policy (CPP) differs from a Business Owner’s Package (BOP). While a BOP combines multiple coverages, it includes a variety of standard coverages that may not be of interest to the policyholder. For example, the policy may include Business Loss of Income coverage, whether or not the policyholder actually wants it. Commercial Package Policies (CPP) only include coverage that is selected by the policyholder.
Features of a Commercial Package Policy (CPP)
Most Commercial Package Policies (CPP’s) start with the following:
- Commercial Property Insurance; and
- Commercial General Liability Insurance.
Additionally, a small or medium sized business may addany number of other coverages including the following:
Business Income / Interruption Insurance in the Commercial Package Policy
Business Income / Interruption Insurance provides coverage against the loss of income that your small or medium sized business may suffers after a related claim. This loss may be due to your business closing or suffering after the claim. Or it could be because of the business restoration and rebuilding process after the claim.
Commercial Auto Insurance
Commercial Auto Insurance can help pay to repair physical damage to the vehicle you drive for business if it’s damaged by theft, weather events, or collisions. It can also pay for lawsuit costs associated with accidents, such as medical expenses and legal fees.
Crime Insurance
Commercial crime insurance is designed to meet the needs of small businesses and other organizations – other than financial institutions such as banks. Commercial crime coverage typically provides several different types of crime coverage, i.e.: employee dishonesty, forgery or alteration, computer hacking or compromise, funds transfer fraud, kidnap, ransom, or extortion, money and securities fraud, money order fraud and counterfeit money coverages.
Excess Liability Insurance
Excess Liability Insurance provides protection once an underlying commercial liability policy has reached its limits. This can be done to extend the limits of your Commercial General Liability Insurance, Employer’s Liability Insurance, Commercial Auto Insurance and Hired & Non-Owned Commercial Automobile Insurance.
Electronic Data Processing Insurance
EDP Insurance is considered an “All Risks” Commercial Property Insurance – including equipment, computer programs, and data. This insurance usually includes coverage for risks to which such property is especially vulnerable – mechanical breakdown, electric injury, and temperature and humidity changes. This protection is extraordinarily important if your business uses computers. It helps to fill many of the gaps that exist in standard Commercial Property Insurance.
Equipment Breakdown / Boiler & Machinery Insurance
Equipment Breakdown Insurance, also known as “Boiler & Machinery Insurance,” provides protection against physical damage and financial loss from equipment breakdown. It covers the cost of repair or replacement of the damaged equipment. It also covers business losses incurred from the equipment breakdown. Equipment Breakdown coverage might cover a broad range of equipment, such as HVAC systems, ovens, boilers, furnaces, refrigeration units, elevators, and even office equipment.
Employment Practices Liability Insurance (EPLI) in the Commercial Package Policy
Employment Practices Liability Insurance (EPLI) covers businesses against claims by workers that their legal rights as employees have been violated. It is a type of liability insurance covering wrongful acts arising from the employment process. The typical type of claims covered under this policy include wrongful termination, discrimination, sexual harassment, and retaliation. The most prevalent type of claim currently are those for retaliation.
Inland Marine Insurance
Inland Marine Insurance is Commercial Property Insurance that protects property in transit over land, types of movable property, instruments of transportation such as bridges and roads. It can also cover instruments of communication such as television and cell phone towers. Finally, it may also cover the legal liability risks of bailees. Most Inland Marine Insurance policies provide coverage regardless of the location of the property. These policies are sometimes called “floaters.” Generally, Inland Marine Insurance coverage forms are broader than other Commercial Property coverage forms.
Pollution Liability Insurance in the Commercial Package Policy
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Ut elit tellus, luctus nec ullamcorper mattis, pulvinar dapibus leo.
Before Purchasing a Commercial Package Policy
Before purchasing a Commercial Package Policy (CPP) its important that a small or medium sized business owner understand the risks that they face. This type of policy only covers specific risks, so if the insured party does not include insurance against a particular event then it will find itself without the appropriate coverage for certain events. Also, this type of policy doesn’t cover workers’ compensation, life, health, or disability, nor could it. These are entirely different types of coverage to be discuss with your broker separately.
