What Is Broad Form Property Damage

    What is broad form property damage; Broad Form Property Damage is the liability exposure represented by property damage to buildings in a contractor’s care, custody, or control. Because of exclusions on this risk of loss for those forms issued between 1973 and 1986 inclusive*, coverage must be purchased with an endorsement. *The exclusion does not apply when contractors are performing operations that create no other potential risks, such as contamination from hazardous substances. Lets’s better understand now what is broad form property damage endorsement

    Understanding a Broad Form Property Damage Endorsement

    A broad form of property damage endorsement has now become out of date in recent years, thanks to reforms in the 1980s. This applies only if it is not excluded under CGL coverage, and most policies do this automatically for you now unless otherwise specified.

    In the general liability insurance policy, many exclusions resulted in certain damages to property not being covered, primarily the care, custody, or control exclusion. 

    Because of these limitations, coverage was only available through a “broad form” endorsement, which would have blanketed any damage incurred by your company’s properties.

    In 1985, the comprehensive general liability insurance policy was updated to the commercial general liability policy and included covered by the broad form property damage endorsement. That made it obsolete because of a new provision in their coverage for “property.”

    Broad Form Property Damage Endorsement Development

    The term “broad form property damage” (BFPD) is often still specifically demanded today as part of a contractor’s liability coverage. It has not been in use by the Insurance Services Office since 1984. This misunderstanding can be clarified with information about what type of protection you are entitled to have from your commercial general liability insurance policy, based on editions published after 1985.

    The new commercial general liability policy contains a list of coverages, the most important being both occurrence and claims made. As explained by ISO in 1985, this is to fulfill what was previously provided under old comprehensive general liabilities insurance or endorsements GL 04-04 Ed 1-73 & 581 respectively.

    ISO, the global organization responsible for setting standards in many industries such as insurance and banking, has been working tirelessly to ensure that their impact within this sphere is understood. This includes publishing newsletters with instructions on how CGL policies will change over time due to new regulations.

     FAQ’s

    What does broad form coverage mean?

    Broad form insurance is a type of coverage that goes beyond the basics to include rare events with serious risks for those who are insured. This typically requires paying higher premiums and sometimes deductibles as well, but it also provides more protection in the event something bad happens.

    What is the difference between basic and broad form coverage?

    Basic Form coverage is a lot more limited than Broad-Form Coverage. Basic coverages tend to only include the most common types of hazards and not additional ones like theft or water damage, whereas broad coverage includes all those hazardous situations plus anything else you need protection from, whether it’s planned for or unplanned.

    What is the broad form of property damage endorsement?

    The broad form property damage endorsement covers the cost of damages caused by subcontractors, as well as those who are working on behalf of general contractors.

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