Commercial Insurance FAQs

Q: How will I be covered by fire legal coverage?
A: If you rent a business space fire legal coverage will protect you if you are held responsible for fire damages to the rented space only.

Q: What is the difference between “actual cash value” and “replacement cost”?
A: “Actual cash value” is when a policy owner is entitled to the depreciated value of damaged property. ”Replacement cost” will reimburse the amount necessary to replace the damaged item with a similar item at current cost.

Q: What is 80% co-insurance?
A: This is a requirement by insurance carriers that at least 80% of the property’s value is insured.

Q: Does my insurance policy cover rental vehicles?
A: The insurance coverage you have will apply to rental vehicles.

Q: Are other drivers covered by my insurance policy?
A: Yes, other licensed drivers will be covered if you loan your car. Regular drivers, however, should be listed on your policy.

Q: What is an audit?
A: Your Company will review the policy at the end of the policy term and, depending on estimated figures such as sales or payroll, will either charge or credit the policyholder.

Q: Why are certificates of insurance from sub-contractors necessary?
A: A sub-contractor’s certificate of insurance will protect you from being held liable for any damages they may cause.

Q; How is General Liability coverage different from Products/Completed Operations coverage?
A: General Liability will provide coverage if you are responsible for damages arising from your premises, general operations or the products that are manufactured or sold. Products/Completed Operations coverage refers to liability for damages caused by your operation or products after they have left your control.

Q: How important is Interruption/Extra Expense coverage?
A: If your business suffers damages from fire or other compensable loss, Business Interruption/Extra Expense coverage will provide coverage for income loss and expenses incurred in establishing a temporary operation site.

Q: What do the terms “Named Insured,” “First Names Insured” and “Additional Insured” mean?
A: Named insured are individuals listed on the policy’s declaration page. It can be the name of one person with insurable interests or multiple persons. “First Named Insured" is the first individual listed on the policy declarations page. This person acts as the legal agent for all the persons listed regarding actions such as cancellation, policy changes an accepting any return premiums. “Additional Insured” is an entity to which the policy is extended and must be added to the policy before a claim is paid. The “Named Insured” and “Additional Insured” must be tied to a relationship. An entity that is an “Additional Insured” will still need its own Commercial General Liability policy.