Alabama Insurance Adjuster Practice Exam

Which of the following items would generally be covered under Coverage A in a typical commercial property policy?

1. Liability for employee injuries

2. Office supplies

3. Machinery owned by the business

4. Personal vehicles of employees

The correct answer is: Machinery owned by the business

Coverage A in a typical commercial property policy is designed to protect the building and its contents that are owned by the insured business. This coverage typically encompasses physical structures and personal property located at the premises that are used in the operations of the business. Machinery owned by the business falls under this coverage category because it is considered part of the property used in conducting business operations. This includes equipment, tools, and machinery that are essential for the day-to-day functioning of the business and are physically located at or within the premises. Therefore, since machinery is a significant asset for many commercial enterprises, it aligns perfectly with the protections offered under Coverage A. The other options, while important to a business, do not qualify under Coverage A. Liability for employee injuries pertains to workers' compensation insurance, which is separate from property insurance. Office supplies are often considered personal property but may not be specifically covered under Coverage A depending on the policy. Personal vehicles of employees are typically covered under auto insurance rather than commercial property insurance, as they are not property owned by the business itself.