A commercial building has been vacant for more than the period specified in the vacancy condition of the Building and Personal Property Coverage Form. Which statement BEST describes the effect on coverage?
a.All coverage is suspended immediately and the policy is canceled by operation of law
b.Only fire and lightning losses remain covered, with no payment reduction
c.Vandalism, sprinkler leakage, glass breakage, water damage, and theft are excluded, and any otherwise covered loss is reduced by 15%
d.Coverage continues unchanged but the deductible is doubled
Explanation
Under the standard ISO vacancy condition, if a building is vacant for more than 60 consecutive days before a loss, the insurer will not pay for loss caused by vandalism, sprinkler leakage (unless protected against freezing), building glass breakage, water damage, theft, or attempted theft. For any other otherwise covered loss, the insurer reduces the payment by 15%.
Law Reference: ISO Commercial Property — Vacancy conditionThis topic, taught in full in the California Property & Casualty Broker-Agent guide. California Property & Casualty Broker-Agent Study Guide — 2026 Edition — PDF + EPUB, $24.99 · 14-day refund →
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