What Is Commercial Package Insurance?
Business owners want the best coverage and value when purchasing commercial insurance but with so many liabilities to consider, they are unsure where to start when purchasing commercial insurance coverage.
Wouldn’t it be more economically feasible for small to medium-sized business owners if there were one policy you could purchase that would cover a wide range of liabilities and risks? A customizable policy that ensured no unnecessary expenses nor gaps in coverage? A policy tailored specifically to the needs, risks and liabilities of a business? Luckily for business owners, there is one. With the help of an experienced insurance broker, you can purchase a commercial insurance policy that is customized for your business’s liabilities and needs.
What Is CPP?
Commercial Package Policy (CPP) is an insurance policy that combines coverage for multiple qualifying events into one comprehensive policy. Purchasing a CPP can save business owners a lot of money on premiums.
Many business owners appreciate the simplicity and convenience of having their commercial insurance policy consolidated. Another benefit to CCP is that it prevents an insurance company from denying coverage because you have a liability policy elsewhere.
What Is Covered by CCP?
A typical CCP policy includes general liability and property coverage, but each CCP plan is specific in its property and liability exposure coverage. General liability covers costs associated with a loss or injury associated with your business, products or services. Property insurance covers damage and destruction of business property including inventory, building(s) and equipment. CCPs allow for customization and combination of two or more coverages into a single comprehensive policy. Business owners can choose which additional policies to add to their CCP based on specific liability risks.
Some common CCP add-on policy options include:
- Commercial Vehicle Insurance - provides coverage for various vehicles owned by your business and used for business purposes.
- Business Crime Insurance - Contrary to popular belief, crime protection policies cover much more than just vandalism and include coverage for embezzlement, money tampering, credit card fraud and more.
- Business Income Insurance (Business Interruption Insurance) - provides coverage for lost revenue and expenses resulting from business shut-down or relocation due to a covered disaster.
- Electronic Data Processing Insurance - provides coverage for costs incurred from a loss or damage of electronic data processing media and equipment.
- Equipment Breakdown Insurance (Boiler and Machinery Insurance) - provides coverage for loss resulting from the malfunction of heating, electrical, air conditioning and other equipment.
- Employment Practices Liability Insurance - provides coverage for costs tied to employee disputes over termination, sexual harassment and other employment issues.
- Inland Marine Insurance - provides coverage for transportation of goods over water and land. IMI provides comprehensive protection for assets that are moveable or mobile in nature. Additionally, it provides protection for products while in transit or in storage.
- Pollution Liability Insurance - provides coverage for costs related to pollution including clean-up.
- Commercial Umbrella Liability - increases and broadens liability coverage to help fill gaps in coverage left in other policies.
Should I Consider Purchasing CPP?
CPPs are ideal for business owners who want a customizable range of insurance protection under one comprehensive plan. Typically, small to mid-sized businesses with smaller liabilities purchase CPPs. Some businesses will have a lower liability need because they operate smaller facilities or only require the add-on policies that CPP’s offers for small risks.
Business owners should take into consideration the type of business they run as well as the liabilities of their businesses when purchasing a commercial insurance plan. For example, a small manufacturing company would not require the same amount of coverage that a real estate developer would. Many insurance companies offer customizable policies for specific types of businesses including schools, churches, manufacturers, health care providers and restaurants.
What Is Not Covered by CCP?Although CCPs are an amazing choice for many business owners, they don't include everything. Required by law, workers’ compensation insurance must be purchased as a separate policy. Non-profit organizations must purchase directors-and-officers insurance to provide coverage if a key employee is sued by a shareholder, customer or other parties.
If your business consults or provides plans as a service, you should obtain professional liability coverage in case you are sued for professional negligence. If you or your employees are found guilty of fraud or any intention of illegal acts, you should have intentional illegal act coverage. Group life insurance and health insurance also need to be separately.
As always, the only insurance policy that will cover flood damages is a flood insurance policy. Most commercial insurance policies specifically exclude flood coverage. Read the fine print of your CCP to understand what is and is not covered by your policy and to familiarize yourself with the coverage limits.
Keep in mind that there may be separate coverage limits for specific things and that deductibles for each respective add-on policy may vary. No insurance policy is completely inclusive but CCPs are definitely more inclusive and comprehensive than many other insurance policy options!
If you like the idea of consolidating policies but a CCP is not quite right. See if a business owner’s policy (BOP) is right for you.
Always work with an experienced insurance agent, who understands the fine print of your commercial insurance policy and helps customize the best policy for your business’s specific liability needs.
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