Texas General Lines — Property and CasualtyCommercial LinesHard
A dry cleaning business sends out customer garments to a specialized fur cleaner for mothproofing. While at the fur cleaner's facility, the garments are severely damaged by a fire. The dry cleaning business has a standard Commercial Property policy. Which Inland Marine coverage would protect the dry cleaning business from its legal liability for the damaged customer property?
- AValuable Papers and Records Coverage
- BLegal Liability Coverage Form
- CBailees Customers Policy
- DCommercial Articles Floater
Show answer & explanationAnswer & explanation
Correct answer: C. Bailees Customers Policy
A Bailees Customers Policy is specifically designed for businesses that hold the property of others, covering their legal liability for loss or damage to that property while in their care, custody, or control. This scenario involves the dry cleaner (bailee) being responsible for customer garments (bailor's property).
Why the other options are wrong
- A. Valuable Papers and Records Coverage is for the cost to replace or restore damaged documents, not customer garments.
- B. While 'Legal Liability Coverage Form' sounds relevant, it's a separate Commercial Property form, not an Inland Marine form, and may not specifically cover the unique bailee-bailor relationship as comprehensively as a Bailees Customers Policy.
- D. Commercial Articles Floater covers items like fine art, cameras, and musical instruments, not property of others in a bailee's care.
Bailees Customers Policy
An Inland Marine policy that covers the insured's (the bailee's) legal liability for loss or damage to customers' property (bailor's property) while in the insured's care, custody, or control.
- Specifically for businesses that hold property of others (e.g., dry cleaners, repair shops).
- Covers legal liability for damage to customer property.
- Often written on an 'all-risks' basis.
Memory trick: Bailee's Burden: Belongings Burn, Blame Binds.