What Are Businessowners Policy Insurance Endorsem*nts? (2024) (2024)

The BP 04 - Additional Coverage Endorsem*nts are as follows:

BP 04 01-Comprehensive Business Liability Exclusion (All Hazards in Connection with Designated Premises or Operations)

This endorsem*nt excludes premises and operations, products/completed operations, and medical payments coverages at specific designated premises on the endorsem*nt schedule or the declarations.

BP 04 02-Additional Insured-Managers or Lessors of Premises

This endorsem*nt adds the owner, lessor, or property manager as an additional insured for liability coverage at locations the named insured leases and occupies.

BP 04 04-Hired and Non-Owned Auto Liability

This endorsem*nt is used only when the named insured does not own vehicles and does not have commercial automobile coverage. Hired autos are leased, hired, or borrowed, except from employees or members of their households, or from partners or executive officers. It does not include mobile equipment. This endorsem*nt protects the named insured if an employee uses his or her car in the business and is different than hired auto liability coverage. If the named insured form of business is a partnership, non-owned auto liability coverage does not apply to autos a partner owns. This coverage is excess over primary insurance that applies to any hired or non-owned autos.

BP 04 06-Additional Insured-Controlling Interest

This endorsem*nt includes as an additional insured the party that financially controls the named insured or for the premises it owns, maintains, or controls for the period that it occupies those premises. However, there is no coverage for structural alterations, new construction, or demolition the party might perform.

BP 04 07-Additional Insured-State or Governmental Agency or Subdivision or Political Subdivisions-Permits or Authorizations Relating to Premises

This endorsem*nt was previously BP 04 07-Additional Insured-State or Political Subdivisions-Permits Relating to Premises. It adds a state or governmental agency or subdivision or political subdivision as an additional insured for certain hazards for which it issued a permit or authorization to the named insured in connection with the premises. Examples include permits issued for advertising signs, awnings, canopies, driveways, manholes, street banners or decorations, or to construct, erect, or remove elevators.

BP 04 08-Additional Insured-Townhouse Associations

This endorsem*nt gives additional insured status to individual townhouse owners for their liability as members of the townhouse association. Coverage does not apply to liability of individual unit owners that arises out of real property titled to them.

BP 04 09-Additional Insured-Mortgagee, Assignee, or Receiver

This endorsem*nt includes as an additional insured a person or organization with respect to its liability as a mortgagee, assignee, or receiver that arises out of owning, maintaining, or using the named insured's premises. However, there is no coverage for structural alterations, new construction, or demolition operations.

BP 04 10-Additional Insured-Owners or Other Interests from Whom Land Has Been Leased

This endorsem*nt adds as an additional insured the owner or another interest from which the named insured has leased land for liability that arises out of owning, maintaining, or using land. Coverage does not apply to events that occur after the lease ends or to any structural alterations, new construction, or demolition operations.

BP 04 11-Additional Insured-Co-Owner of Insured Premises

This endorsem*nt adds as an additional insured the person or organization on the endorsem*nt schedule that owns the scheduled premises in common with the named insured with respect to liability coverage as co-owner of the premises.

BP 04 12-Limitation of Coverage to Designated Premises or Project

This restrictive endorsem*nt is intended to provide coverage for either a specific scheduled premise or a specific scheduled operation/project. Some significant lawsuits found off-premises coverage in the prior edition so the wording in the new version is much more precise. Of particular note is that the phrase "arising out of" has been eliminated when referring to the premises. The goal is to cover ONLY injuries that occur on the premises itself and to not cover injuries from activities or decisions that might emanate from that premises.

BP 04 13-Additional Insured-Engineers, Architects, or Surveyors

This endorsem*nt includes as an additional insured an architect, engineer, or surveyor the named insured hires, However, this is only with respect to liability that arises from the named insured's actions or omissions or the actions or omissions of others that act on its behalf with respect to the named insured's premises or work performed on its behalf. Coverage applies to ongoing operations but not to completed operations.

BP 04 15-Spoilage Coverage

This endorsem*nt covers spoilage losses to perishable stock the insured owns. The 07 13 changes are editorial in nature to match similar editorial changes in BP 00 03-Businessowners Coverage Form and do not affect coverage.

BP 04 16-Additional Insured-Lessor of Leased Equipment

This endorsem*nt extends liability coverage to the person or organization on the endorsem*nt schedule that leases equipment to the named insured. Coverage applies to only liability that arises out of the named insured maintaining, operating, or using the lessor's equipment. Spaces are provided to describe the leased equipment and the location(s) where it is kept.

BP 04 17-Employment-Related Practices Exclusion

This endorsem*nt excludes liability that arises out of employment-related practices. Examples are refusal to employ, termination of employment, coercion, demotion, evaluation, reassignment, discipline, defamation, harassment, humiliation, discrimination, malicious prosecution, or other employment-related practices, policies, acts, or omissions. It also excludes consequential injuries that result from these practices, whether the event that caused the injury occurs before, during, or after the person's employment.

BP 04 19-Amendment-Liquor Liability Exclusion-Exception for Scheduled Activities

This endorsem*nt excludes losses caused or contributed to by any insured that involve intoxication of any person, even if due to alcohol that others bring to the premises, furnishing liquor to minors or persons already under the influence, or for liability assumed under a statute concerning distribution of liquor. It applies to all cases that involve alcoholic beverages, regardless of whether or not the insured is in the liquor business. This exclusion does not apply to any premises or activity listed in the schedule.

BP 04 30-Protective Safeguards

This endorsem*nt is used when a rate or premium credit applies to reflect the specific protective safeguards listed on the endorsem*nt schedule as being installed at the designated location. The named insured agrees to maintain them in proper working order at all times or an otherwise covered loss is excluded. The warranty nature of this endorsem*nt means that a loss can be excluded even if there is no relationship between the lack of a working protective safeguard and the loss that occurred. The 07 13 edition adds a description and symbol for hood-and-duct fire extinguishing systems.

BP 04 31-Food Contamination

This endorsem*nt pays the costs to clean equipment, replace ruined food, and limited expenses for advertising to restore the named insured's business reputation if a governmental entity closes the business because of suspected food contamination. The limits are $10,000 for cleanup and replacement and $3,000 for additional advertising expense unless other limits are selected. Section I-Property Exclusion B.1.j. Virus or Bacteria does not apply with respect to the coverage this endorsem*nt provides. The 07 13 edition broadens the definition of food contamination and covers vaccinations to all employees, including leased and temporary employees, even if the infection is only potential.

BP 04 37-Exclusion-Personal and Advertising Injury

This endorsem*nt deletes all personal and advertising injury liability coverage.

BP 04 38-Medical Expenses-Exclusion

This endorsem*nt excludes medical expenses at the locations or for the classifications on the endorsem*nt schedule. Coverage is added to the Liability Supplementary Payments for first aid administered to others at the time of an accident.

BP 04 39-Abuse or Molestation Exclusion

This endorsem*nt excludes injury or damage due to abuse and molestation. This includes negligent employment, investigation, supervision, failure to report to proper authorities, or retention of individuals who committed or were involved in such acts.

BP 04 40-Coverage for Injury to Leased Workers

This endorsem*nt provides employers liability coverage for leased and temporary workers by changing the definition of employee to not include leased worker or temporary worker. This change applies to only the Employers Liability exclusion. It is recommended for businesses that do not carry workers compensation insurance that use only leased employees.

BP 04 41-Business Income Changes-Time Period

The endorsem*nt eliminates the waiting period before a business is reimbursed for loss of income. The coverage period is four weeks. The 07 13 edition reflects changes made in BP 00 03 5. Additional Coverages m. Business Income from Dependent Properties.

BP 04 46-Ordinance or Law Coverage

Ordinance or law construction considerations have become more important in recent years. Building codes are upgraded regularly. This improves buildings' ability to resist windstorm, earthquake, fire, and collapse and accommodates handicapped persons under the Americans with Disabilities Act (ADA). Older buildings are more likely to encounter ordinance or law issues and their related costs as a precondition to rebuilding after a loss.

The property section of the Insurance Services Office (ISO) Businessowners Coverage Form excludes costs to comply with construction requirements established by ordinances or laws. Further, the language in the loss payment section reinforces this by stating that replacement cost does not include any additional costs due to complying with any laws or ordinances that relate to construction.

The BOP does include Increased Cost of Construction coverage under its Additional Coverage section subject to a $10,000 limit. Examples of such increased costs that could be paid are changing bathrooms to be handicap accessible, adding wheelchair ramps, lowering water fountains, and similar requirements that ADA mandates. While $10,000 maybe helpful for such minor changes it is inadequate if an ordinance requires the adding of automatic sprinklers or widening of the hallways.

The amount of ordinance or law coverage needed depends on the specific building and its occupancy. Coverage may not be needed at all if the building is newer or there are not any specific ordinances or laws that apply to the specific occupancy. For others, it might be the difference between resuming operations and closing for good after a covered loss.

The good news is that BP 04 46–Ordinance or Law Coverage is available. It covers both the property and the business income associated with complying with ordinances and laws that had been grandfathered but come into play after a covered direct damage loss occurs.

BP 04 47-Additional Insured-Vendors

This endorsem*nt amends BP 00 03 Section II-Liability C. Who is an Insured. It adds products liability coverage for vendors named on the endorsem*nt schedule as additional insureds for the products listed. It covers bodily injury or property damage liability that arises from the named insured's products the vendor sells or distributes in the course of its normal business operations, subject to the endorsem*nt's exclusions and limitations.

BP 04 48-Additional Insured-Designated Person or Organization

This endorsem*nt amends BP 00 03 Section II-Liability C. Who is an Insured. It allows the named insured contractor to cover any additional insured when no other specific additional insured endorsem*nt applies. It covers the party named on the endorsem*nt schedule for bodily injury or property damage liability caused by the named insured's acts or omissions or by acts or omissions of others that act on its behalf. Loss or damage must occur in the course of the insured's ongoing operations or at premises it owns or rents, subject to the endorsem*nt's exclusions and limitations.

BP 04 49-Additional Insured-Engineers, Architects, or Surveyors Not Engaged by the Named Insured

This endorsem*nt allows the named insured contractor to include as additional insureds engineers, architects, or surveyors that common project owners hire or that a written contract or agreement requires adding. It protects the party named on the endorsem*nt schedule for bodily injury or property damage liability that arises from the named insured's ongoing operations, subject to the endorsem*nt's exclusions and limitations. Covered losses must be caused by the named insured's act or omission or by acts or omissions of others that act on its behalf. Losses caused solely by the designated additional insured are excluded.

BP 04 50-Additional Insured-Owners, Lessees, or Contractors-Scheduled Person or Organization

This endorsem*nt covers any person or organization on the endorsem*nt schedule for which the named insured contractor performs operations. Coverage applies to bodily injury or property damage liability that arises out of the named insured's ongoing operations. However, it excludes completed operations and is subject to certain exclusions and limitations. Covered losses must be caused by the named insured's act or omission or by acts or omissions of others that act on its behalf. Losses caused solely by the designated additional insured are excluded.

BP 04 51-Additional Insured-Owners, Lessees, or Contractors-With Additional Insured Requirement in Construction Contract

This endorsem*nt covers any party for whom the named insured contractor performs work as a written contract or written agreement requires. It protects the party for bodily injury or property damage liability that arises from the named insured's operations specified in the contract or agreement and applies only until the contract or agreement ends. Covered losses must be caused by the named insured's act or omission or by acts or omissions of others that act on its behalf. Losses caused solely by the designated additional insured are excluded.

BP 04 52-Additional Insured-State or Governmental Agency or Subdivision or Political Subdivision-Permits or Authorizations

This endorsem*nt was previously BP 04 52-Additional Insured-State or Political Subdivisions-Permits. It covers any state or governmental agency or subdivision or political subdivision on the endorsem*nt schedule that the named insured contractor must include as an additional insured in order to obtain needed work permits. Losses caused solely by the designated additional insured are excluded.

BP 04 53-Water Back-Up and Sump Overflow

This endorsem*nt covers loss or damage caused by or that results from water that backs up from a sewer or drain or from overflow of a sump or sump pump that damages covered property at locations on the endorsem*nt schedule. This is essentially an additional specific covered cause of loss. Coverage does not apply if the loss was due to negligent maintenance of the pump or if an insured failed to clear an obstruction from a drain and the obstruction caused the damage. The $5,000 annual aggregate limit of insurance per location can be increased or decreased.This endorsem*nt also covers loss of Business Income or Extra Expense incurred as a result of these losses at locations on the endorsem*nt schedule. The $5,000 annual aggregate limit of insurance per location can be increased or decreased.The 07 13 edition clarifies that "drain" includes a roof drain and related fixtures. It also states that there is no coverage when a sump pump fails because of power failure unless the coverage form covers power failure.

BP 04 54-Newly Acquired Organizations

This endorsem*nt covers newly acquired organizations or organizations the named insured forms during the policy period for up to 90 days or until expiration, whichever occurs first.

BP 04 55-Broadened Coverage for Damage to Premises Rented to You

The unendorsed Businessowners Coverage Form excludes loss or damage to buildings that the named insured occupies as a tenant. The only exception is when damage is due to fire. This is considered "Damage to Premises Rented to You" coverage.

The default limit for this fire coverage is $50,000 but a higher limit can be purchased. The increased limit is then shown on the Declarations. The maximum limit is $1,000,000.

However, there are two important limitations. The coverage is a sublimit of the Liability and Medical Expenses limit and the only covered cause of loss is fire. When a tenant-insured has exposures in excess of $50,000 and/or needs coverage for causes of loss other than fire - this is an endorsem*nt that can be attached to the BOP.

BP 04 56-Utility Services-Direct Damage

This endorsem*nt extends property damage coverage to loss or damage to covered property due to service from off-premises water, communication, power supply services, and overhead power transmission and communication lines being interrupted. However, it excludes loss or damage to electronic data. The utility service property does not have to be outside a covered building. The 07 13 edition states that transmission lines include any line that transmits power or communication service. This includes distribution lines.

BP 04 57-Utility Services-Time Element

This endorsem*nt extends time element or loss of income coverage to apply to loss of business income or extra expense that results from interruption of off-premises water, communication, power supply services, and overhead power transmission and communication lines, but excludes loss or damage to electronic data. The utility service property does not have to be outside a covered building. The 07 13 edition adds wastewater removal property to the list of covered utility services and states that transmission lines include any line that transmits power or communication service. This includes distribution lines.

BP 04 58-Business Income and Extra Expense Coverage for Year 2000 Computer-Related and Other Electronic Problems

This endorsem*nt insures the named insured's business against loss of business income or extra expenses incurred due to computer programming or processing errors related to a system or software's inability to address, handle, and resolve calendar dates or times. It pays for only loss of business income or extra expenses that relate directly to computer processing problems. The annual aggregate limit for all losses and/or expenses is $25,000.

BP 04 64-Year 2000 Computer-Related and Other Electronic Problems-Limited Coverage Options

This endorsem*nt provides limited protection for bodily injury, property damage, and personal and advertising injury liability because of computer programming or processing errors that a system or software could not address, handle, or resolve that involved calendar dates or times. It extends the coverage and limits to apply to such losses but only to locations, products, or operations on the endorsem*nt schedule.

BP 04 71-Exclusion-Volunteer Workers

This endorsem*nt removes the term volunteer workers from the coverage form and eliminates volunteer workers as insureds.

BP 04 83-Removal of Insurance-To-Value Provision

This endorsem*nt eliminates the requirement that property must be insured to 80% of replacement value at the time of loss in order for the loss to be adjusted on a replacement cost basis.

BP 04 84-Functional Building Valuation

This condition replaces the valuation loss condition by agreeing to pay to replace a damaged building on the same site with a functionally equivalent building. In case of a partial loss, the damaged portion of the building is repaired with less costly material. The named insured should carefully evaluate and consider the building limit it chooses when it selects this option. This endorsem*nt includes ordinance or law provisions for direct damage loss. It also has an option to include business income and extra expense coverage for the additional time needed to comply with ordinance or law changes. The 07 13 changes are editorial in nature to match similar editorial changes in BP 00 03 and do not affect coverage.

BP 04 85-Functional Business Personal Property Valuation

This condition replaces the valuation loss condition. It agrees to pay to replace damaged business personal property with functionally equivalent property or property valued on a market value basis. The named insured should carefully evaluate and consider the business personal property limit it chooses when it selects this option.

BP 04 86-Vacancy Changes

This endorsem*nt allows the minimum percentage of building occupancy used to determine vacancy in a covered location to be increased or decreased from 31%. It applies to only the premises and building(s) on the endorsem*nt schedule.

BP 04 87-Vacancy Permit

This endorsem*nt amends the vacancy provision to temporarily suspend applying the vacancy provision at only the premises and buildings on the endorsem*nt schedule for the time period selected. It has some flexibility in that loss or damage due to vandalism or sprinkler leakage can be excluded during the period of suspension.

BP 04 88-Liquor Liability

This endorsem*nt adds liquor liability coverage by deleting the liquor liability exclusion. It is used in cases where an insured has limited exposure to such losses. It should not be used when BP 04 89-Liquor Liability Coverage is used.

BP 04 89-Liquor Liability Coverage

This endorsem*nt adds liquor liability coverage. It applies to businesses that have significant liquor liability exposures and covers bodily injury and property damage liability related to their furnishing liquor. Coverage does not apply if the named insured operates without a license when legally required to have one. It is limited to the aggregate and per-cause limits on the endorsem*nt schedule.

BP 04 90-Pollution Exclusion-Limited Exception for a Short-Term Pollution Event

This endorsem*nt adds some liability coverage for bodily injury or property damage related to specific short-term pollution events under certain circ*mstances. It defines a short-term pollution event and this definition and other provisions provide limited coverage for accidental, non-recurring pollution losses. However, a number of other pollution exclusions and exceptions still apply. As a result, this endorsem*nt should be reviewed carefully before it is recommended as a possible coverage solution for the named insured's pollution-related exposures.

BP 04 91-Pollution Exclusion-Limited Exception for Designated Pollutant(s)

This endorsem*nt adds both on-site and off-site liability coverage for bodily injury or property damage related to damage caused by the types of pollutants described on the endorsem*nt schedule. However, coverage does not extend to losses that involve handling, transporting, storing, disposing of, treating, or processing the described pollutants.

BP 04 92-Total Pollution Exclusion

This endorsem*nt completely excludes bodily injury or property damage loss or damage caused by or that results from pollution. There are no exceptions.

BP 04 93-Total Pollution Exclusion with a Building Heating Equipment Exception and a Hostile Fire Exception

This endorsem*nt completely excludes bodily injury or property damage loss or damage that pollution causes. However, it has exceptions that cover loss or damage that involves heat, smoke, and fumes that a hostile fire generates and/or by heating, cooling, dehumidifying, and water heating equipment.

BP 04 94-Limited Pollution Liability Extension

This endorsem*nt adds limited pollution liability coverage. It eliminates the part of the exclusion that applies at or from any premises that the named insured owns rents, occupies, or has loaned to it. It should be reviewed carefully to determine if the broadened coverage is appropriate for the named insured. It has its own aggregate limit.

BP 04 97-Waiver of Transfer of Rights of Recovery against Others to

This endorsem*nt eliminates the insurance company's ability to secure subrogation rights by preventing it from proceeding against another party that may be responsible for damages it paid. The company waives exercising its rights against only the party(ies) on the endorsem*nt schedule.

BP 04 98-Employee Benefits Liability Coverage

This endorsem*nt covers oversights and errors the named insured makes in administering its various employee benefits programs. It does not cover improper or inadequate advice regarding investments or the actual investment decisions the retirement plan or pension administrator makes. This endorsem*nt should not be used in place of fiduciary liability coverage. Any business subject to the requirements of the Employee Retirement Income Security Act of 1974 (ERISA) should have fiduciary liability coverage.

Employee benefits liability coverage may not seem important if the insured business does not provide group medical, life benefit, or retirement programs. However, most businesses offer vacation, sick leave, and maternity leave and nearly all businesses must provide workers compensation, social security benefits, and unemployment insurance. Errors in administering any of these could result in lawsuits and coverage would be available only if this endorsem*nt was attached.

Note: This endorsem*nt provides coverage on a claims-made basis and is subject to a retroactive date.

BP 04 99-Extended Reporting Period for Employee Benefits Liability Coverage

This endorsem*nt is used with BP 04 98-Employee Benefits Liability Coverage. Coverage applies on a claims-made basis and this endorsem*nt gives the named insured the option to extend the time period to report losses. This is very important if coverage changes from a claims-made to an occurrence basis. The 07 13 changes are editorial in nature to match similar editorial changes in BP 00 03 and do not affect coverage.