What types of perils are commonly excluded from a commercial property policy?

Commercial property policies are designed to provide coverage for specific risks, but there are certain perils that are typically excluded. The correct choice highlights that flooding, earthquake damage, and certain types of government action are common exclusions.

Flooding is usually excluded because it is often a high-risk peril requiring specialized flood insurance, which is separate from general property coverage. Earthquakes are also excluded due to their potential for catastrophic financial loss, and similar to flooding, they require distinct coverage options that specifically address those risks. Additionally, government actions—such as seizure of property through eminent domain—are excluded as they fall outside the scope of standard property risks intended to be covered.

This understanding is crucial for businesses to adequately assess their risk exposure and consider additional policies, such as flood or earthquake insurance, to protect against these significant perils. By recognizing these exclusions, policyholders can make informed decisions about their insurance needs and ensure they have appropriate coverage for potential risks they face.