COMMERCIAL OUTPUT
PROGRAM – PROPERTY COVERAGE SAMPLE INSURANCE PROPOSAL LANGUAGE
(July 2025)
All PF&M subscribers are permitted to reprint the following
insurance proposal sample language when preparing insurance presentations for
their commercial insurance customers. Other uses require permission by The
Rough Notes Company, Inc.
The following paragraph or similar language needs to be included in all
insurance proposals:
Consult the policy for definitions and limitations. The terms of this
proposal do not represent contract terms. The policy is subject to company
underwriting practices.
This proposal language is not intended to be an entire insurance
proposal. A client specific section, including the name and address of the
insured, the insurance company(s) and the agent, and information about them, a
list of locations, limits, deductibles, and similar customer specific items are
not included and should be prepared.
The intent of any insurance proposal is not to be a reproduction of the
insurance policy but to provide a summary of possible coverages.
Paragraphs explaining coverages unique to this policy form may be the
most important addition to your insurance proposal and sales effort. Coverage
examples can be tailored to your individual customer. Be cautious when
modifying any proposal language to ensure it does not expand coverage beyond
what the policy intends.
If applicable, this proposal should be integrated with proposals for
other lines of business, such as general liability, workers compensation, and
umbrella liability, to create a comprehensive account proposal. Additionally,
providing a checklist of recommended endorsements would be beneficial, as long
as you can explain each endorsement and its intended use.
Related Articles:
AAIS
Commercial Output Program Available Endorsements and Their Uses
AAIS
Commercial Output Program Endorsements Checklist
The American
Association Insurance Services, Inc. (AAIS) Commercial Output Program is the
AAIS version of a Manufacturer’s Output Policy. CO 1000–Commercial Output Program–Property Coverage Part must be included
on every AAIS Commercial Output Program policy because it contains the
conditions, definitions and other universal elements that apply to the
coverage.
CO 1000 – Commercial Output Program – Property Coverage Part provides
extremely broad coverage for buildings and business personal property. It has
seven coverage extensions, 13 supplemental coverages and 11 supplemental marine
coverages.
The coverages provided
are listed on CO 1050 or CO 1051–Schedules of Coverages. These forms have
spaces for changing the policy default limits for any coverage provided. The
Schedules of Coverages also list the coverage parts and include spaces for
entering limits, as well as a list of coverage extensions and supplemental
coverages. Spaces are also available to identify the coverage parts excluded or
to which coverage does not apply.
The insurance company
pays for direct physical loss of or damage to covered property situated at a
covered location. The loss or damage must be caused by or result from the
occurrence of a covered peril during the policy period.
When there is a limit of insurance for building on the schedule of
coverages, owned or leased (if required) buildings and structures are covered.
If Scheduled Locations is selected, then only the locations and coverages shown
on the Location Schedule are covered.
The following is also considered covered building or structure:
The following items are
covered as a sublimit of the limit of insurance. When a limit is provided, it is
subject to the policy limits of insurance and not an additional limit.
This is the loss of
value to undamaged personal property because other property has been damaged by
a covered peril.
These are the costs associated
with removing debris caused by an insured loss to covered property. The payment
is limited to 25% of the amount of the loss plus $50,000. The maximum payment
for debris removal plus the actual loss amount is the limit of insurance, plus
$50,000.
This provides coverage
at another location when the covered property is moved due to an impending
covered peril. No exclusions apply while the property is located at the
emergency location. Coverage applies until the policy expires or 365 days,
whichever is less.
This pays for the
expenses incurred by the insured to move property to the emergency location in
order to protect it from an impending covered peril. The $5,000 sub-limit is
independent of and not included in the coverage limit specified under Property
Covered.
If covered property is
lost because it is given to any persons who represent themselves as authorized
persons or present fraudulent bills of lading or receipts, this coverage
applies, but only for $5,000.
This applies only if
the named insured is a tenant. It covers the contractual obligation the tenant
has to the building owner for damage to the building when caused by theft or
attempted theft.
This provides up to
$50,000 for direct physical loss or damage when caused by an off premises utility
interruption. It applies only if the interruption damages covered property and
the damage to the utility is caused by a covered peril.
The following items are
covered in addition to the limit of insurance for building and business
personal property. If no limit is specified in the provision, the limit is the
full limit for the applicable coverage or the limit indicated on the Schedule
of Coverages.
A payment of up to $50,000
in any one occurrence is made to cover the costs an insured incurs to stamp
salvage on merchandise and also to remove brands or labels from property when damaged
in a covered loss. The removal should not physically damage the merchandise. Re-labeling
is also covered, but only when required by law.
The costs incurred by
the insured to speed up permanent or temporary repairs to or replacement of
covered property after an insured loss are covered for up to $50,000 in any one
occurrence.
Charges the insured is
contractually bound to pay for fire department services are covered up to
$25,000. These charges are paid only if the contract was in place before the
loss and the services provided were intended to save or protect the insured's
property from loss or damage by a covered peril.
These are expenses incurred
by the insured to satisfy the insurance company’s request for inventory details
and value the loss for a covered limit up to $50,000.
This covers the value
of the undamaged building that must be torn down because a covered loss has
damaged part of the structure, and an ordinance requires the remaining portion
to be torn down.
This covers the cost to
remove the debris resulting from the undamaged portion of the building being
torn down. It also covers the increased cost to rebuild the structure in
accordance with current building ordinances.
Property owned by the
insured, its officers, partners and employees and covered for up to $15,000.
Covers the insured's
expense to extract pollutants from land or water if the pollution event is
caused by a covered peril and is reported to the insurance company within 180
days after it occurs. Coverage does not apply to expenses for testing,
monitoring, or assessing the effects of pollutants, except for the costs of
testing necessary to extract pollutants from the land or water. The $50,000
aggregate limit applies at each site or covered location during each separate
12-month policy period.
Coverage pays up to
$50,000 for expenses incurred to recharge automatic fire extinguishing
equipment or fire extinguishers, but only when discharged to fight a fire or accidentally
discharged. It is also covered if necessitated by a covered peril.
Coverage pays up to
$10,000 for information leading to the conviction of a person or persons who
caused a covered theft, vandalism, or arson loss.
Coverage pays up to
$25,000 per occurrence for direct physical loss or damage to covered property when
due to water backing up through a sewer or drain, or subsurface water exerting
pressure on or flowing through or into covered property.
Coverage pays up to
$50,000 per single occurrence for direct physical loss or damage, including
debris removal expenses, to outdoor trees, shrubs, plants, and lawns. The only
perils covered are fire, lightning, explosion, riot, civil commotion, falling
objects and vandalism.
Coverage provides up to
$250,000 per single occurrence or at any one covered location, for direct
physical damage caused by a covered peril to structures such as pilings, piers,
wharves, docks, retaining walls, underground pipes, flues, drains, bridges, walkways,
roadways, and other paved surfaces.
The following items are
covered in addition to the limit of insurance for building and business
personal property. If no limit is specified, the limit is the full limit for
the applicable coverage or the limit indicated on the Schedule of Coverages.
Coverage of up to
$50,000 applies for losses and expenses you incur due to direct physical damage
or loss caused by a covered peril to records of accounts receivable. This
includes not only the uncollectible money but also expenses to restore
financial records, interest on loans taken to cover the loss, collection costs,
and other related expenses.
This covers direct
physical loss or damage to computers caused by electrical or magnetic
disturbances. This coverage is not in addition to the applicable limit.
This covers direct
physical loss or damage to computers when due to disturbances in the power
supply, including interruption, power surge, blackout or brownout. This
coverage is not in addition to the applicable limit.
This covers direct
physical loss or damage to covered computers, networks and web sites due to a
computer virus or by computer hacking. The limit of coverage is $25,000 per occurrence
and a $50,000 aggregate 12-month policy period.
Coverage applies up to
$100,000 in a single occurrence or at any one covered location for direct
physical loss or damage by a covered peril to fine arts, while temporarily on
display or exhibit at other than a covered location and while in transit
between such locations.
This covers up to
$25,000 in a single occurrence for direct physical loss or damage caused by a
covered peril to computers in the custody of the insured, its officers,
partners and employees when away from a covered location and while in transit
between where the individual carrying the computer is located and a covered
location.
Coverage applies up to
$50,000 in a single occurrence for direct physical loss or damage due to a
covered peril to business personal property temporarily on display or exhibit
at locations other than a covered location.
This covers up to
$50,000 in a single occurrence for direct physical loss or damage due to a
covered peril to business personal property while in transit, regardless of the
number or types of vehicles involved in the loss. This coverage is extended to business
personal property sold and being shipped at the owner's risk, if and when the
owner rejects the shipment because it is damaged and refuses to pay for it.
This provides coverage
up to a $50,000 limit in a single occurrence for direct physical loss or damage
due to a covered peril to samples of the insured's stock in trade, including
containers and similar property of others. Coverage applies only if the samples
are in the custody of sales representatives or in transit between a covered
location and a sales representative.
This provides coverage
up to a $50,000 limit per single occurrence to duplicate and backup software as
a result of direct physical loss or damage by a covered peril to duplicated and
backed-up software stored at a software storage location.
Coverage pays up to
$100,000 for the cost of research and other expenses needed to reproduce,
replace or restore lost information caused by or resulting from direct physical
loss or damage by a covered peril to valuable papers.
Coverage applies to risks
of direct physical loss or damage to property, unless the peril is limited or excluded
from the policy.
The first category of exclusions is essentially absolute. With certain
specific exceptions, each item in this category is completely excluded,
regardless of any other causes or events that may contribute to a loss, whether
happening simultaneously or in any other order. The insurance company will not
cover any direct or indirect loss or damage caused by or resulting from any of
these events.
·
Ordinance Or Law
Excludes any increased cost of construction due to the enforcement of
any building code, ordinance or law regulating the construction, use or repair
of any building or structure, its demolition or removal of its debris. The only
exception is coverage provided under Supplemental Coverages.
·
Earth Movement
Excludes any loss or damage caused by any earth movement, other than
sinkhole collapse, or caused by eruption, explosion or effusion of a volcano. Examples
of earth movement include earthquakes, landslides, mudflows, mudslides, mine
subsidence, or the sinking, rising, or shifting of the earth.
·
Civil Authority
Government ordered acts that cause loss or damage are excluded. Seizure,
confiscation, destruction and quarantine are examples of civil authority
actions.
·
Nuclear Hazard
Excludes any loss caused by nuclear reaction, nuclear radiation or
radioactive contamination. Loss caused by the nuclear hazard is not considered
loss caused by fire, explosion or smoke.
·
War and Military Action
Excludes loss or damage caused by war or warlike action by a military
force. Actions taken by the government to prevent or defend against an expected
or actual attack by any government or other authority are also excluded. If any
of these actions involves nuclear reaction, radiation or radioactive
contamination, this exclusion applies in place of the Nuclear Hazard exclusion.
·
Flood
Losses of any kind, as defined in the coverage form, are excluded.
Coverage does apply to loss or damage caused by fire, explosion, or sprinkler
leakage resulting from a flood.
·
Utility Failure
Failure to supply electrical power or other utility service to a covered
location is excluded if the failure occurs away from the covered location. Some
coverage is provided in the provision and in the Supplemental Marine Coverages
·
Sewer Backup and Water Below the
Surface
There is no coverage for sewer backup or water below the surface.
However, if such an event results in fire, explosion or sprinkler leakage, the
loss or damage from those events is covered. Additionally, there is some
coverage provided under Supplemental Coverages.
The second group of exclusions applies to loss or damage caused by or
resulting from any of the following loss events. Some of these exclusions have
exceptions, conditions or limitations that should be noted and reviewed
carefully. The insurance company does not pay for any loss or damage caused by
or resulting from any of these events.
·
Animal Nesting, Infestation or
Discharge
Any animal loss or damage is excluded. However, there is limited
coverage under “specified perils” and for building glass.
·
Collapse
Loss or damage caused by collapse is excluded, except as provided under
Other Coverages–Collapse or if the damage results from a covered peril.
·
Computer Virus or Computer
Hacking
Computer Virus or Hacking that causes loss or damage, whether direct,
indirect or resulting from loss of access, use or functionality, is not
covered, except as provided under Supplemental Marine Coverages–Virus and
Hacking Coverage.
·
Contamination or Deterioration
Loss or damage caused by contamination or deterioration is excluded. However,
there is some limited coverage.
·
Criminal, Fraudulent or
Dishonest Acts
Acts committed alone or in collusion by the named insured, any party
having an interest in the property, any party entrusted with the property,
partners, officers, directors, trustees and joint venturers or employees or
agents of any of the above, whether at work or not, are not covered. Theft by
employees is also excluded.
·
Defects, Errors and Omissions
Losses resulting from the following are excluded:
o
land use, design, specification, construction,
installation, or maintenance of property
o
planning, zoning, development, siting, surveying,
grading, compaction, or maintenance of property, regardless if the work is
on-site or off-site
o
defective, weak, inadequate, faulty, or unsound
construction materials
o
costs associated with correcting design errors,
losses due to data processing or programming errors, or providing improper
instructions
o
business personal property losses caused by defects
or deficiencies in design, specifications, materials, or workmanship, as well
as those resulting from inherent or latent defects
·
Electrical Currents
Loss or damage due to electrical arcing or electrical currents of any
kind other than lightning is excluded.
·
Steam Boiler Explosion
This exclusion applies to loss or damage caused by the explosion of
steam boilers, steam pipes, steam turbines or steam engines, but only if they
are owned, leased or operated by you.
·
Increased Hazard
Excludes coverage when a hazard materially increases, you are aware of
the increase, and a loss occurs. The increase in hazard is not required to be
the cause of the loss.
·
Loss of Use
This means any consequential loss, including loss of use, delay, or loss
of market, is excluded.
·
Mechanical Breakdown
The rupturing or bursting of moving machinery parts caused by
centrifugal force that results in loss or damage is excluded.
·
Neglect
Your failure to use all reasonable means available to save covered
property during and after a covered loss is not acceptable. As a result, any
loss caused by such neglect is not covered. Additionally, if you do not take
all reasonable steps to save and preserve covered property endangered by a
covered peril, there is no coverage.
·
Pollutants
There is no coverage for loss caused by any action of pollutants unless
the event is caused by a specified peril. Limited coverage is provided under
Supplemental Coverages–Pollutant Cleanup and Removal.
·
Seepage
Damage caused by the seepage or continuous leakage of water or steam for
14 days or more is not covered.
·
Settling, Cracking, Shrinking,
Bulging or Expanding
Loss or damage to pavement, footings, foundation, walls, ceilings or
roofs is excluded.
·
Smoke, Vapor or Gas
Agricultural smudging or industrial operations, when loss or damage is caused
by Smoke, Vapor or Gas, is excluded.
·
Smog
Damage or loss caused by or resulting from smog is excluded.
·
Temperature/Humidity
Extremes of humidity, dryness or dampness causing loss or damage to
perishable stock are excluded, except as provided under Coverage Extensions–Off
Premises Utility Service Interruption.
·
Wear and Tear
When the only loss or damage is wear and tear, marring or scratching,
there is no coverage.
·
Weather
Conditions of weather that cause or contribute in any way with a peril
excluded in the first group of exclusions, leading to loss or damage, are also
excluded.
·
Voluntary Parting
When you voluntarily part with title to or possession of covered
property, resulting in loss or damage, is excluded. Coverage also does not
apply when the party receiving the property was part of a fraudulent trick or
scheme, and no value was gained by parting with the property. Some coverage is
provided under Coverage Extensions–Fraud and Deceit.
Losses caused by
bookkeeping, accounting, or billing mistakes are not covered. If the only proof
of loss is from an audit or physical inventory, there is no coverage.
Only animals intended
for sale are covered. Birds and fish are included as animals.
Loss or damage to steam
boilers, pipes, turbines and engines or hot water boilers or heaters caused by
a condition or event inside this equipment is not covered, including bursting,
cracking or rupturing.
This is not covered.
Ammonia is an example of a refrigerant excluded, but it is not limited to just
ammonia.
Theft of furs or fur
garments is not covered if the loss exceeds $10,000 in a single incident.
Coverage for loss or
damage due to breakage of fragile articles is not included unless the breakage
results from a designated peril or the breakage of building glass.
A sub-limit of $10,000
applies to any theft loss of jewelry, watches, and precious stones, including
watch movements, jewels, pearls and semi-precious stones. This limitation does
not apply to any item valued at $100 or less.
If the only proof of
loss is a shortage discovered while taking inventory, as an accounting or
bookkeeping transaction or by any other circumstance where no physical evidence
is present to suggest what happened is not covered.
No coverage applies to
personal property when caused by rain, snow, sleet, or ice.
A sub-limit of $5,000
applies to any theft loss of stamps, letters of credit, and tickets, such as lottery
tickets held for sale.
When covered property
is transferred via the computer or is delivered to a person or place, there is
no coverage for any loss or damage to the property if the transaction was the
result of unauthorized or false instructions, regardless of how the
instructions were transmitted. The only exception is the limited coverage
provided under the Coverage Extension–Fraud or Deceit.
Losses as a result of
errors or omissions in copying or processing valuable papers are not covered.
Building, structure, or
personal property collapse is covered if caused by the following:
o
specified
perils, hidden decay, hidden insect, or vermin damage
o
weight
of people or business personal property, or weight of rain that collects on a
roof
o
defective
construction material, but only if the collapse occurs during the course of
construction, remodeling, or renovation
o
must
be sudden and unexpected
A building in imminent
danger of collapse is not covered until it actually collapses.
This coverage applies
when a covered loss caused by water, other liquids, powder, or molten material
occurs, and the undamaged building must be destroyed in order
to repair or replace the system causing the issue. The cost of the destruction
of the undamaged building and its repair is provided by this coverage. The
repair of the system itself is not covered.
However, if a fire
extinguishing system is damaged by its discharge or by freezing, this coverage
will pay for its repair or replacement.
o
Notice
of a claim must be provided to the insurance company by you or your agent
promptly.
o
A
description of the property involved must be part of the notice.
o
The
insurance company must state when it requires a written notice to be provided.
o
If
the loss is the result of the commission of a crime, the police must be
notified.
o
In
the event of a loss involving a credit card, the credit card company must also
be notified.
o
You
must take steps to protect covered property from further damage during and
after a loss.
o
You
must keep accurate records of these costs and expenses, and if the loss is
covered, you will be reimbursed for reasonable emergency repairs and expenses.
o
The
insurance company does not pay for any anticipatory repairs or emergency
measures against an insured peril that has not yet occurred.
o
Emergency
repair costs do not increase the limit of insurance.
A sworn and signed
statement of loss from you, including all necessary information, must be
submitted to the insurance company within 60 days of the company's request.
You must agree to be
examined under oath and give sworn statements of the answers as often as
reasonably requested by the insurance company. The company can request that all
involved persons be questioned separately, without the presence of others, as a
means of preventing collusion.
You must produce any and all records related to the loss, value, or expense
and permit the insurance company to make copies or extracts of them as often as
it reasonably requires.
Damaged and undamaged
property must be made available to the insurance company by you as often as the
insurance company requires. It must be reasonable in its requests and permitted
to take samples to determine the extent of loss to certain property, where the
amount of loss may not be immediately apparent.
You can make voluntary
payments, but not with any anticipation that the insurance company will
reimburse the payment. The only payments you can make and expect reimbursement are
for those payments the insurance company has given written permission. The
costs to protect property from further damage, as described above, are the only
voluntary payments that will be reimbursed. Any unapproved expenditures are at your
own expense.
You are not permitted
to abandon property to the insurance company without its consent. Since the
company decides what property it will take, you remain responsible for the
damaged property until and unless the insurance company decides what it will or
will not accept.
You must cooperate with
the insurance company in performing all acts required by the policy. If you do
not cooperate, a claim may be denied.
This valuation applies unless actual cash value is selected on the
Schedule of Coverages.
Replacement Cost is the cost to repair or replace damaged property with similar
materials on the same site and used for the same purpose. However, valuation cannot
exceed the amount actually spent on the repairs or replacement.
It is important to
understand Replacement Cost valuation will not apply unless the damaged
property is repaired or replaced. You must notify the insurance company within
180 days after a loss if you intend to use the replacement cost option. Until
the property is repaired or replaced, a claim for Actual Cash Value can be
made.
When Actual Cash Value
is selected on the Schedule of Coverages, the value of covered property is its
actual cash value on the date of loss. Actual cash value is not defined, but
common usage of the term is replacement cost with a deduction for physical
depreciation.
Separate valuation
terms apply to the following categories: Fine Arts, Glass, Hardware, Software,
Merchandise Sold, Manufactured Stock, Pairs or Sets, Loss to Parts, Tenant's
Improvements, Valuable Papers, and Accounts Receivable.
Payment will not be
made for more than your insurable interest in the property.
Payment is only for the
amount of loss exceeding the deductible listed on the Schedule of Coverages.
The deductible applies to each occurrence and is applied before any coinsurance
or reporting provisions.
All losses to a
building from earthquakes and volcanic eruptions during a 168-hour consecutive
period are considered a single event, even if the 168 hours extend beyond the
policy's expiration date.
The insurance company
pays the least of the amounts determined under Valuation, the actual cost to
repair, replace, or rebuild with similar materials to the extent possible, or
the limit that applies to the covered property. This is subject to the other
provisions in How Much We Pay.
If two or more
coverages provided by the form apply to the same loss, the insurance company
pays no more than the actual amount of the claim, loss, or damage incurred.
If you have other
insurance coverage that is the same as what is provided in this policy, the
insurance company will only pay its share of a covered loss. This share is
determined by comparing the coverage limits of this policy to the limits of all
other applicable coverages.
If a different type of
coverage applies to a covered loss, the insurance company will only pay the
amount of the loss that exceeds what the other coverage will pay, regardless of
whether or not that amount is collectible, up to the applicable limit of this
policy.
If an entry is made on
the Schedule of Coverages for Automatic Increase, the property limit will increase
automatically every year by the percentage shown on the schedule.
This gives the
insurance company four options to pay for covered losses. It is required to
notify you within thirty days after a covered loss about their chosen method of
payment:
o
It
can pay the value of the lost or damaged property, as determined in Valuation
and How Much We Pay.
o
It
can pay the cost to repair or replace the lost or damaged property.
o
It
can pay to actually rebuild, repair, or replace the property with similar
property within a reasonable time, to the extent possible.
o
It
can pay the appraised or agreed value for the property and then take the
property.
The insurance company
adjusts losses with you or any loss payee named and pays within 30 days after
receiving satisfactory proof of loss. This is after the amount of loss is
established by either a written agreement between you and the company or by an
appraisal award.
The insurance company
can adjust losses directly with you or with the party that owns the property. If
the owner of the property sues you, the insurance company has the option to
defend you at its own expense.
This condition is found
in all policies and forms that cover property. It establishes a simple method
to resolve valuation disputes on covered property between you and the insurance
company.
This means insurance
coverage does not directly or indirectly benefit anyone with custody of your
property.
This means if any part
of the policy or coverage form conflicts with a law that applies, the form is
amended to conform to that law.
This means coverage
provided by the form is not affected by any act or neglect beyond your control.
This condition applies
if you die. Your rights and duties are passed to the party acting as your legal
representative. If no legal representative is appointed, the party having
proper temporary custody of the property is treated as the insured for the
property.
This means if the
coverage provided by the form is broadened, without an additional premium
charge, during the policy term or within the six months prior to the coverage
effective date, the broadened coverage applies to this form.
Coverage will be void
if, before or after a loss, any insured person willfully conceals or
misrepresents a material fact or circumstance related to the insurance, their
interest in the insurance, or engages in fraud or false swearing concerning any
matter related to this insurance.
This means losses must
occur during the policy period shown on the declarations.
Handling the recovery
of lost property after a loss payment has been made, including the procedures,
requirements, and steps that both you and the insurance company must follow
when it occurs.
This means payments
made for covered losses or damages do not reduce the limit of insurance that applies,
and the limit is reinstated. This condition does not apply to Supplemental
Coverages–Pollutant Cleanup and Removal and Supplemental Marine Coverages–Virus
and Hacking Coverage.
This means the
insurance company has the right to require you to assign your rights of
recovery against others to the company, if the company has paid a loss others
may have caused. You must do everything you can to secure those rights for the
company and do nothing to impair them, or the company has the right to deny
payment. However, you can waive your rights of recovery against others in
writing before a loss occurs.
This means you cannot
sue the insurance company unless it has complied with all the terms of the
coverage form and unless the action is brought within two years of the date you
first have knowledge of the loss or within the shortest period permitted by any
law that invalidates this condition.
This applies to covered
property in the United States, its territories and possessions, Canada, and
Puerto Rico.
The insurance company
has specific obligations to the mortgagee named on the policy. If more than one
mortgage is involved, losses are paid in the order of precedence. Insurance for
the benefit of the mortgagee remains in effect, regardless of any actions you
may take that could void coverage. However, coverage does not continue if the
mortgagee was aware of changes in ownership or increases in hazard and did not
notify the insurance company.
This condition restricts
coverage by not paying losses caused by theft, attempted theft, glass breakage or
sprinkler leakage (if not protected against freezing) if the building or
structure is vacant or unoccupied for more than 60 consecutive days or longer
than the normal incidental period of unoccupancy for seasonal property. The
amount paid is reduced by 15% for any loss by a covered peril not otherwise
excluded.
Vacancy means the
occupants have moved and the building is empty or contains only limited
personal property. Unoccupancy means customary activities are suspended, but
business personal property is still present in the building and has not been
removed.
Buildings or structures
under construction are not considered vacant or unoccupied.