(June 2016)
INTRODUCTION
The Civil Authority
Additional Coverage in the CP 00 30, CP 00 32, and CP 00 50 covers time element
losses when access to the covered business is denied by order of a civil
authority. The reason for the order must be due to damage to a non-owned structure
from a covered cause of loss and the civil authority must either require continual
access to the area or the area must be considered too dangerous to allow public
access.
The good news is that coverage
applies for up to four weeks.
The bad news is that the
coverage is available only for businesses that are located one mile of the
damaged structure that triggered the civil order.
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Example: Gingerbread House is located 1.5 miles from a state park.
A small bridge provides the only access to the park and Gingerbread. A
wildfire in the park forces civil authorities to close all access to the park
at the small bridge so they can move firefighters and their equipment in to
fight the fire. It takes three weeks to control the fire and extinguish it. Gingerbread
is closed the entire time but it is undamaged and the damaged structures were
more than a mile away. As a result, Gingerbread’s business income coverage
does not apply.
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This endorsement is
designed to fill two gaps in coverage. The number of days of coverage for acts
of a civil authority and/or the one-mile radius can be increased.
SCHEDULE
This extension of
coverage must be selected by premises and building number. If Schedule Part A
is selected, the total number of days of coverage needed must be entered. The
coverage form provides coverage for 28 days. An entry is required to increase
this number of days.
If Schedule Part B is
selected, the new radius mileage limitation must be entered. The radius
limitation in the coverage form is one mile. An entry greater than one mile is
needed in order to extend coverage.
A. Coverage Period
As stated above,
Additional Coverages–Civil Authority in CP 00 30, CP 0032, and CP 00 50 is
limited to four weeks. If a different period of time is required, the total
number of days entered on the Schedule replaces the four weeks in the coverage
form.
The time period in the
coverage form is stated in weeks while the entry on this endorsement must be
entered as a number of days. This means that the entry must be 29 or higher if
the goal is to increase coverage. The number of days entered must be considered
carefully because the number of days entered completely replaces the four weeks
in the coverage form.
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Number entered
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Resulting coverage period
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Blank (none)
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Basic four-week period
applies
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Zero
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No coverage applies
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6
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Six days coverage
applies
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42
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Six weeks coverage
applies
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Note: This is meant to extend a coverage limitation, not restrict
it. However, nothing in this endorsement limits its use and its title merely states
Civil Authority Change(s). Entries can be confusing because the time period in
the coverage form is expressed in weeks while the time period in this
endorsement’s schedule is expressed in days.
B. Radius
Civil authority coverage
applies only if the named insured’s premises is within
one mile of the damaged property. Any entry in the schedule replaces the one
mile limitation. Entering nothing means the one-mile radius still applies.
Note: Editions prior to the 06 07 edition of CP 00 30 did not have
a mileage limitation. In order to match those editions, “Unlimited” is required.
Entering nothing means that the one-mile limitation remains in effect. Entering
zero could mean the civil authority would apply only if the civil authority
closed the business’ actual building.
CONSIDERATIONS
Examples of recent losses
where this limitation could have had an impact include the destruction of New
York City’s Twin Towers in the 9/11 attack, Hurricanes Katrina, Rita, and Ike, and
the western states’ wildfires. Consider explaining to your client why the
business across the street had coverage and he or she does not. This
endorsement could eliminate the considerable gap introduced with the radius
wording and limitation in Additional Coverages–Civil Authority.
Related Court Case:
Civil Action Without Physical Damage Results
In No Coverage
