On May 2, 2025, Wheeler, DiUlio & Barnabei launched a new webinar series: First Party Fridays with Tony DiUlio!
This series was created to provide free, interactive lunch-and-learn sessions focused on important insurance topics. Tony will be breaking down everything from policy language to claim strategies and everything in between. His goal is to help attendees build a stronger understanding of key insurance issues through practical insights and real-world examples.
On May 2, 2025, Tony hosted the kickoff webinar of the series: Commercial Claims Part 1: Understanding Commercial Policy. He explained how to read commercial insurance policies, highlighted key differences between commercial and residential policies, and shared tips and tricks for navigating common commercial policy language.
What is a Commercial Policy?
Commercial insurance policies may resemble standard residential policies in format, but they are far more complex and unique on a case-by-case basis. Unlike residential claims, which tend to follow more standardized structures, commercial policies are tailored to the specific industry and property involved. These policies often include a variety of specialized endorsements, such as business income coverage or cyber liability coverage, that go beyond what a typical homeowner would need.
The most important part of any commercial policy is the Declaration Pages, which act as a roadmap for the rest of the policy. The Dec Pages outline critical details such as:
- The name of the insured
- Mailing and insured addresses
- Properties covered
- Applicable forms
- Policy limits
- Deductibles
While some endorsements are self-explanatory by title, others may require deeper review to fully understand their implications.
How to Review a Commercial Policy
Reviewing a commercial policy requires careful attention and a solid understanding of how these documents are structured. It’s important to read the entire policy thoroughly, as exclusions and supplemental details are often embedded in various sections and endorsements.
Here are some key areas to review when examining a commercial policy:
The Declaration Pages may look familiar, listing basic information such as coverages and limits, but they also include an extensive list of forms, some of which may contain hidden exclusions that significantly affect your coverage. Be sure to locate and review all form numbers, typically found in the top or bottom margins of each page, to ensure you’re examining the complete policy.
Within the Declaration Pages, a description of coverages and optional coverages are generally listed and may include building coverage, business income with extra expense, and business personal property with details such as limits of insurance, coinsurance percentages, covered causes of loss, and deductibles—similar in structure to homeowners policies but with more commercial-specific details.
Additionally, many policies rely on standard ISO forms for coverage and loss explanations, such as the “Cause of Loss – Special Form,” which outlines what’s covered and what’s excluded. It is critical not to make assumptions based on residential policies, as commercial coverage can vary significantly in scope and structure.
Differences Between Commercial and Homeowners Policies
While commercial and homeowners insurance policies may appear similar on the surface, the differences (especially when it comes to endorsements) are substantial. One of the most frequent distinctions is how water damage is treated.
In many commercial policies, if a storm causes water intrusion without wind damage, the resulting interior damage may not be covered unless specifically endorsed. However, homeowners’ policies may include such coverage.
Another major difference is business income and extra expense coverage. This coverage can get complicated when reconciling income versus net income, especially when factoring in operational cost savings during downtime or determining whether income refers to the business or individual.
Additionally, commercial policies often include protective safeguard endorsements—specific requirements the insured must meet to keep coverage active. These safeguards are tailored to the property’s risks and underwriting needs, and failure to uphold them can lead to denied claims or reduced coverage.
Understanding the complexities of commercial insurance policies is crucial to protecting your business. Plus, knowing what to look for can make all the difference when filing a claim.
