Which coverages have no deductible under BOP?

• A. Business income, civil authority, extra expense, fire department service charge, fire extinguisher systems recharge expense
• B. All coverages have a deductible
• C. Outdoor signs only
• D. Money and securities only

Answer: (A)

In a Businessowners Policy, some coverages are designed to respond without a deductible because they are time-element or rapid-response costs that help a business recover and keep operating after a loss. The coverages that have no deductible are those that reimburse lost income or necessary expenses to continue operations or secure property, rather than paying for direct property damage.

Business income and extra expense reimburse the business for income lost and for costs to continue operations after a covered loss, and civil authority coverage pays when access to the insured’s premises is restricted due to a covered loss. Fire department service charge coverage pays the fire department fees charged to save or protect property, and fire extinguisher recharge expense covers the cost to recharge extinguishers after they’ve been used. All of these are intended to be paid with no deductible.

Other property-related coverages typically apply deductibles, since they reimburse physical property damage.