CIC COMMERCIAL PROPERTY FINAL PAPER QUESTIONS
AND SOLUTIONS 2025/2026 RATED A+
✔✔Transfer of Rights of Recovery Against Others to Us (Waiver of subrogation) - ✔✔1.
can waive rights of recovery against anyone as long as it is in writing and PRIOR to a
loss
2. After a loss, can ONLY waive if in writing and the responsible party is:
- another insured
- a business owned/controlled by the NI
- a tenant of the NI
✔✔Covered Property - PP of Others - 2 categories - ✔✔1. PPOO in your CCC
2. Located in/on premises or within 100 ft
✔✔Additional Covered Property Endorsement - ✔✔Can be used to buy back certain
property that is not covered
✔✔Are underground pipes covered?
Are Retaining walls covered?
Are Building Foundations covered? - ✔✔No.
Retaining walls are only covered if connected to the building
Building Foundations which are below the lowest basement floor or the surface of the
ground are NOT covered
✔✔Specific Coverage
Scheduled Coverage
Blanket Coverage
how many locations? - ✔✔Specific
- One Loc
- specific amount of insurance for each type of property
Scheduled
- two or more locs
- Specific amount of insurance for each type of property at each separate location
Blanket
- One Limit for more than one type of property (ex: Building and YBPP at the same
location)
OR
- One limit that for one or more types of property (ex: Just buildings, just BPP, or
building and BPP combined)
,(Coinsurance required for blanket)
✔✔Advantages of Blanket Coverage (5) - ✔✔1. NI can apply insurance where needed
when more than one type of property is covered
2. handles fluctuating values between locations or fire-rated divisions
3. reporting forms easier to handle
4. NI may have 100% insurance to value at each location, but only has to carry 90% itv
for all locations comibined
5. may help if there is a demand surge following a loss
✔✔Disadvantages when writing blanket coverage (6) - ✔✔1. 90-100% coinsurance
reqd
2. Blanket may not be possible bc of underwriting restrictions
3. SOV must be obtained listing each item and amt of covg
4. Rates for one year only
5. must have same causes of loss for all covered property
6. must list all ownership interests w/ multiple locations
✔✔CP Endorsements that address Fluctuating Values
Limitation on Loss Settlement - Blanket Insurance Endorsement (Margin Clause)
Peak Season Endorsement
Value Reporting Form Endorsement - ✔✔Limitation on Loss Settlement - Blanket
Insurance Endorsement (Margin Clause)
- limits max amount payable for any item to a % times the latest reported SOV
Peak Season Endorsement
- Allows NI to increase covg for a specified # of days to reflect predictable seasonal
increases in PP inventory
Value Reporting Form Endorsement
- NIs w/ fluctuating PP values or changing locations
- NI must be willing and able to make accurate/timely required reports
✔✔Limitation on Loss Settlement - Blanket Insurance Endorsement (Margin Clause) -
✔✔CP Endorsements that address Fluctuating Values
- limits max amount payable for any item to a % times the latest reported SOV
- applies to building and contents
- severely restricts the "blanket" concept
✔✔Peak Season Endorsement - ✔✔CP Endorsements that address Fluctuating Values
, - Increase covg for a specified # of days to reflect predictable seasonal increases in PP
inventory
- May be for any number of periods within the policy term
- endorsement shows the additional amount needed during peak season, not the total
limit
- may NOT be written on a Value Reporting Form or on property written on a blanket
basis
- additional premium is pro-rated
✔✔Value Reporting Form Endorsement - ✔✔CP Endorsements that address
Fluctuating Values
- NIs w/ fluctuating PP values or changing locations
- NI must be willing / able to make accurate/timely reports
- Eligible Property: PP of NI and others, Stock
- advance premium paid at inception, final premium determined at end
- reports must be submitted accurately and on-time
- inaccurate reports will result in reduced recovery or higher premium
- first report not submitted: reduces coverage by 75%
- later reports missing: uses the most recent report
✔✔Under a CP Value Reporting Form, the first report is submitted late. How much does
the policy pay in the event of a loss?
How much would the policy pay if the first report was received, but second report was
not?
How much would the policy pay if the report is under-reported?
How much if the report is in excess of the actual value? - ✔✔If first report is late, policy
pays 75% of what would have otherwise been paid
If a later report is late, policy pays no more than the last report of values
If report is under-reported, policy pays the percentage reported (did/should) x loss
If report is over-reported, policy pays up to the policy limit.
✔✔CP Six Additional Coverages #1: Debris Removal - ✔✔expense to remove debris of
Covered Property and other debris that is on the described premises, when debris is
caused by a Covered COL
- must be reported in writing within 180 days (9months)
Does NOT apply to:
- property not covered
- deposits of mud/earth
- extract pollutants from land/water
AND SOLUTIONS 2025/2026 RATED A+
✔✔Transfer of Rights of Recovery Against Others to Us (Waiver of subrogation) - ✔✔1.
can waive rights of recovery against anyone as long as it is in writing and PRIOR to a
loss
2. After a loss, can ONLY waive if in writing and the responsible party is:
- another insured
- a business owned/controlled by the NI
- a tenant of the NI
✔✔Covered Property - PP of Others - 2 categories - ✔✔1. PPOO in your CCC
2. Located in/on premises or within 100 ft
✔✔Additional Covered Property Endorsement - ✔✔Can be used to buy back certain
property that is not covered
✔✔Are underground pipes covered?
Are Retaining walls covered?
Are Building Foundations covered? - ✔✔No.
Retaining walls are only covered if connected to the building
Building Foundations which are below the lowest basement floor or the surface of the
ground are NOT covered
✔✔Specific Coverage
Scheduled Coverage
Blanket Coverage
how many locations? - ✔✔Specific
- One Loc
- specific amount of insurance for each type of property
Scheduled
- two or more locs
- Specific amount of insurance for each type of property at each separate location
Blanket
- One Limit for more than one type of property (ex: Building and YBPP at the same
location)
OR
- One limit that for one or more types of property (ex: Just buildings, just BPP, or
building and BPP combined)
,(Coinsurance required for blanket)
✔✔Advantages of Blanket Coverage (5) - ✔✔1. NI can apply insurance where needed
when more than one type of property is covered
2. handles fluctuating values between locations or fire-rated divisions
3. reporting forms easier to handle
4. NI may have 100% insurance to value at each location, but only has to carry 90% itv
for all locations comibined
5. may help if there is a demand surge following a loss
✔✔Disadvantages when writing blanket coverage (6) - ✔✔1. 90-100% coinsurance
reqd
2. Blanket may not be possible bc of underwriting restrictions
3. SOV must be obtained listing each item and amt of covg
4. Rates for one year only
5. must have same causes of loss for all covered property
6. must list all ownership interests w/ multiple locations
✔✔CP Endorsements that address Fluctuating Values
Limitation on Loss Settlement - Blanket Insurance Endorsement (Margin Clause)
Peak Season Endorsement
Value Reporting Form Endorsement - ✔✔Limitation on Loss Settlement - Blanket
Insurance Endorsement (Margin Clause)
- limits max amount payable for any item to a % times the latest reported SOV
Peak Season Endorsement
- Allows NI to increase covg for a specified # of days to reflect predictable seasonal
increases in PP inventory
Value Reporting Form Endorsement
- NIs w/ fluctuating PP values or changing locations
- NI must be willing and able to make accurate/timely required reports
✔✔Limitation on Loss Settlement - Blanket Insurance Endorsement (Margin Clause) -
✔✔CP Endorsements that address Fluctuating Values
- limits max amount payable for any item to a % times the latest reported SOV
- applies to building and contents
- severely restricts the "blanket" concept
✔✔Peak Season Endorsement - ✔✔CP Endorsements that address Fluctuating Values
, - Increase covg for a specified # of days to reflect predictable seasonal increases in PP
inventory
- May be for any number of periods within the policy term
- endorsement shows the additional amount needed during peak season, not the total
limit
- may NOT be written on a Value Reporting Form or on property written on a blanket
basis
- additional premium is pro-rated
✔✔Value Reporting Form Endorsement - ✔✔CP Endorsements that address
Fluctuating Values
- NIs w/ fluctuating PP values or changing locations
- NI must be willing / able to make accurate/timely reports
- Eligible Property: PP of NI and others, Stock
- advance premium paid at inception, final premium determined at end
- reports must be submitted accurately and on-time
- inaccurate reports will result in reduced recovery or higher premium
- first report not submitted: reduces coverage by 75%
- later reports missing: uses the most recent report
✔✔Under a CP Value Reporting Form, the first report is submitted late. How much does
the policy pay in the event of a loss?
How much would the policy pay if the first report was received, but second report was
not?
How much would the policy pay if the report is under-reported?
How much if the report is in excess of the actual value? - ✔✔If first report is late, policy
pays 75% of what would have otherwise been paid
If a later report is late, policy pays no more than the last report of values
If report is under-reported, policy pays the percentage reported (did/should) x loss
If report is over-reported, policy pays up to the policy limit.
✔✔CP Six Additional Coverages #1: Debris Removal - ✔✔expense to remove debris of
Covered Property and other debris that is on the described premises, when debris is
caused by a Covered COL
- must be reported in writing within 180 days (9months)
Does NOT apply to:
- property not covered
- deposits of mud/earth
- extract pollutants from land/water
