What is the limit for the additional coverage Forgery and Alteration under the Businessowners Policy?

What is the limit for the additional coverage Forgery and Alteration under the Businessowners Policy?

• A. $1,000
• B. $2,500
• C. $5,000
• D. $10,000

Answer: (B)

The additional coverage for Forgery and Alteration under a Businessowners Policy is specifically designed to protect businesses from financial losses resulting from the forgery of checks, drafts, or similar instruments. The correct limit of coverage for this protection is typically set at $2,500. This amount is established within the policy to adequately address the potential risk while balancing the overall coverage limits typical for small to medium-sized enterprises. Choosing a limit like $1,000 or $5,000 would not align with the standard policy provisions, which recognize that financial loss due to forgery can be substantial but also sets a reasonable limit that reflects a risk assessment of these events occurring. A limit of $10,000 is also higher than the standard coverage, which would not be practical for most business owners looking to manage their insurance costs effectively.

The additional coverage for Forgery and Alteration under a Businessowners Policy is specifically designed to protect businesses from financial losses resulting from the forgery of checks, drafts, or similar instruments. The correct limit of coverage for this protection is typically set at $2,500. This amount is established within the policy to adequately address the potential risk while balancing the overall coverage limits typical for small to medium-sized enterprises.

Choosing a limit like $1,000 or $5,000 would not align with the standard policy provisions, which recognize that financial loss due to forgery can be substantial but also sets a reasonable limit that reflects a risk assessment of these events occurring. A limit of $10,000 is also higher than the standard coverage, which would not be practical for most business owners looking to manage their insurance costs effectively.