Which of the following best differentiates commercial lines insurance from personal lines insurance?

The distinction between commercial lines and personal lines insurance is fundamentally based on the type of entity being insured. Commercial lines insurance is specifically designed to provide coverage for businesses, encompassing a wide range of organizations, from small enterprises to large corporations. This type of insurance addresses the unique risks and liabilities that businesses face, such as property damage, liability for injuries sustained on business premises, and coverage for business interruptions.

On the other hand, personal lines insurance is tailored for individual consumers and the private property they own, such as homeowners or auto insurance. This sort of insurance addresses personal risks rather than business-related ones.

The other statements, while touching on aspects of commercial lines insurance, do not accurately capture the essential differentiation. For instance, while it is true that some commercial lines may include non-profit organizations, that alone does not define the nature of commercial lines versus personal lines. Similarly, the assertion that commercial lines are more affordable does not hold universally, as pricing depends on various factors, including risk exposure and coverage requirements. Lastly, while larger businesses often require more complex commercial insurance, commercial lines are not limited to only large entities, as small businesses and sole proprietors also seek out this type of insurance.