Georgia Property & Casualty Practice Exam

Which type of endorsement provides coverage for property when it is used for business purposes?

1. business property endorsement

2. personal property endorsement

3. additional living expenses endorsement

4. general liability endorsement

The correct answer is: business property endorsement

The endorsement that provides coverage for property used for business purposes is the business property endorsement. This specific type of endorsement is designed to extend the coverage of a standard property insurance policy to include property that is primarily utilized in a business context. When an individual operates a business, certain assets may not be adequately covered under a typical homeowners or renters policy, which often focuses on personal property. The business property endorsement addresses this gap by ensuring that business equipment, inventory, and other assets related to business operations are protected against perils such as theft, fire, and other damages. In contrast, personal property endorsements generally cover items used in a personal capacity, while additional living expenses endorsements typically provide coverage for temporary living costs when a dwelling is uninhabitable due to a covered loss. General liability endorsements focus on protecting against legal liabilities rather than specific property coverage. Thus, the business property endorsement specifically caters to the needs of businesses, making it the most appropriate choice for coverage of property intended for business use.