Did You Know…

For all Commercial Business:

Changing your business operations, occupancy, or ownership: Your policy is rated based on the information you provided on your application and your coverage depends on it being accurate and current. It’s important that you advise our office of any changes in business ownership, operations or occupancy immediately so that we can inform your insurance company and seek their approval for your changes. Keep in mind that changes to your operations, sales receipts, or other factors may result in an increase or decrease to your premium mid-term.

Gross Projected Receipts: When an insurance company asks this question, they are looking for the total amount of money you expect to bring in (before expenses) for the upcoming year. This should be based on your sales revenue from prior years. Important: In the event of a claim the insurance company may ask to review your financials to see if the amount you declared was as accurate as you could reasonably determine.

For all Commercial Property Business:

Co-Insurance Clause: Often misunderstood, this clause is there to make it fair to all insurance customers. Since most losses are partial losses, it is unfair to those who insure their property to value if those that under insure pay less premium. Therefore, if this clause if in your policy then it may limit the amount the insurance company will be responsible if you under insure. For example, if you have $100K of property and a 90% coinsurance clause then if you advise your property limit to be anything less than $90K then the clause will kick in and you will be responsible for any loss by how much you’ve under insured.

Roof Exclusion: If your roof is outdated, this may have been applied to your policy. It excludes losses caused by the collapse of your roof. If you see this, it is recommended that you get your roof updated as soon as possible and request to have this exclusion removed.

Vacancy Permit: If your property is going to be vacant for more than 30 days, failure to notify your broker may result in voiding of coverage in the result of a claim. Depending on the details, you may be able to get a vacancy permit added to your policy for a limited time at an additional premium.

Locked Vehicle Warranty: The most common perils against tools and equipment is theft. To ensure that you are taking the proper precautions against this exposure, your insurance company may have added this clause which states that a claim will not be honoured if your property is stolen from an unlocked vehicle.

Alarm System Warranty: If you advised your insurance company that there is a monitored alarm at your premises, this warranty applies. It states that a theft claim may be denied if the alarm was not operational at the time of loss.

Fire Protection Warranty: Common on restaurant risks, if you advised that there is a CO2 fire suppression system to prevent fires from a deep fryer or grill, this warranty applies. It may also refer in general to any declared and required fire protection such as fire alarms and fire extinguishers. It states that a fire claim may be denied if these alarms were not operational at the time of loss.

Replacement Cost (RC) vs. Actual Cash Value (ACV): A policy that replaces an item without deduction for depreciation in the event of a claim is called Replacement Cost. An Actual Cash Value policy pays the cost at the time less depreciation by obsolescence or general wear.

Boiler / Production Machinery / Equipment Breakdown coverage: It’s purpose is to insure against financial losses/property damage, business interruption and spoilage losses that result from defined accidents to specified kinds of mechanical, electrical and pressure equipment. Your equipment could include but is not limited to such things as steam boilers, refrigeration, air conditioning systems, motors and generators, machines designed to cut, shape, convey or mold a product or raw material or materials in process. This coverage comes with different options to cater to your business so it is important to make sure you are getting the right coverage.

For all Commercial Liability Business:

Coverage is limited to designated premises: If this shows in your conditions, it is indicating that your liability is OLT (Owners, Landlords, and Tenants). It means your CGL coverage only applies to losses that occur due to your ownership of a building or unit (for example, somebody slips and falls on your doorstep). Is it usually followed with:

Completed Products Exclusion: This excludes any product liability and usually forms part of the OLT conditions. If you want products liability you do not want to see this exclusion.

Specific Operations Exclusion: This is sometimes put on when a company does not want to insure losses that arise out of one or more aspects of your company. They should have listed here what portion of your operations they are excluding.

Liquor Exclusions / Conditions: If you are running a restaurant, bar, club, or any business where liquor serving could be an exposure, the insurance company may have certain exclusions or conditions for coverage to apply. It is important you read these and familiarize yourself with what coverage you have.

For all Commercial Auto Business:

Replacement / Downtime Endorsement: In the event that your vehicle is damaged to the point where it cannot be driven until repaired or replaced, this endorsement will provide coverage to rent a temporary vehicle so you can continue on with your business. An option exists with most companies to upgrade this to provide loss of income in the event that a suitable replacement vehicle can’t be found. Ideal of specialised units such as boom trucks.

Accident Waiver / Record Protector: When a driver has an accident with your vehicle, even after they leave your employment, your premium will still go up. This is because commercial vehicle driving records are based no accidents by either the drivers or the vehicle. Most companies offer this endorsement which will keep your driving record the same after the first at-fault accident.

27B for trailers: This endorsement is to extend the physical damage to any non-owned trailer you might pull with the vehicle you attach it to.

27B versus a Garage Policy: If you have tow trucks you should make sure you have coverage for the vehicles you are towing. If you have a Garage policy then this extends to cover any vehicle that is in your Care Custody and Control. If you do not have a garage and work on contract for others with just your tow truck then you should make sure your auto policy includes a 27B for the units while you are towing them. If you tow more than one vehicle or carry the vehicles on a flatbed (the wheels of the vehicle do not touch then ground) then you may need a Cargo Insurance policy to cover loss or damage to these units.

Depreciation Waiver: If you have a new vehicle, you may be able to purchase an endorsement that will have your vehicle replaced at a replacement cost basis. Your vehicle is otherwise covered on an ACV (Actual Cash Value) basis although it may be rated by LPN (List Price New).

Attached Machinery: It is very important to declare if there is any machinery attached to your vehicle. Some machinery will form part of the use of the vehicle while it is motion (such as a snow plough) while others only serve a purpose while the vehicle is stationary (like a boom / crane).

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