What does 'force majeure' refer to in commercial property insurance contracts?

In commercial property insurance contracts, 'force majeure' refers to events that are beyond the control of the parties involved in the contract and may prevent them from fulfilling their obligations. This concept typically includes natural disasters, such as earthquakes, floods, or hurricanes, as well as other unforeseen circumstances like riots or war. The essence of force majeure is that it provides relief to the affected party, acknowledging that certain situations are unavoidable and can impede contractual performance.

By recognizing force majeure, contracts often contain clauses that outline the conditions under which the parties may be excused from performance due to such extraordinary events. This allows for a degree of flexibility and understanding in the contract, ensuring that parties are not penalized for situations they could not possibly manage or foresee.

The other options do not accurately capture the essence of force majeure. Unexpected marketing successes do not hinder contractual obligations, while foreseeable and manageable events do not fall under the category of force majeure, as those are anticipated and can typically be planned for. Standard operational risks are also part of normal business operations and do not excuse parties from fulfilling their contract.