(July, 2008)
This article is a repository of articles and analyses that relate to earlier editions of the above captioned program or coverage form. For a discussion of the current program, please refer to PF&M Section 460.4-2, ISO Special Homeowner Coverage Form Analysis (10 00 Edition).
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Archive Index |
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Analyses |
ISO Special Homeowners Form Analysis - 04 91 Edition |
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Comparisons |
Comparison of ISO Pre-H0 2000 Forms |
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Endorsements |
ISO Pre-HO 2000 Optional Coverage Endorsements |
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Special Analysis |
Risk Of Direct Loss HO Policy |
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Special Analysis |
ISO Pre HO 2000 HO Broad Form Coverage Analysis |
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Special Analysis |
ISO Pre-HO 2000 Unit-Owners Form Coverage Analysis |
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Special Analysis |
HO 05 90 Home Business Endorsement |
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Special Analysis |
ISO Personal Property Replacement cost Endorsement HO 04 90 04 91 |
The following is an analysis of the ISO (Insurance Services Office) Homeowner Coverage Form. The focus of this analysis is on the HO 91 edition, Special Form Policy.
A. (1) and (2)
In this section, coverages are outlined for the dwelling itself. The term dwelling does not apply only to the dwelling on the “residence premises” which is shown on the declarations. Dwelling also refers to any structures that are attached to the dwelling and materials and supplies that are located on or next to the “residence premises.” However, eligible materials have to be intended for building, renovating or repairing the dwelling or other structures on the “residence premises.”
B. (1) and (2)
Other structures on the "residence premises" are also covered under this form. However, certain criteria must be met in order for the policy to extend coverage. The structure must be located away from the dwelling and separated by clear space. Included in this definition of clear space are structures that are connected only by fences, utility lines or similar types of connecting devices. As it is with Coverage A, Coverage B does not apply to land, including the land upon which the other structure sits.
Other structures that are used in business activities are ineligible for coverage. The activities have to meet the policy's definition of business. The policy makes exceptions for other structures an insured rents out to a non-premises resident who uses the structure as a private garage.
The limit of liability for this coverage is restricted to no more than ten percent of what the dwelling itself is insured for. (No more than 10% of the Coverage A limit.)
C. (1) and (2)
Personal property owned by or used by an “insured” is covered anywhere in the world. Other coverages can be extended at the client’s request. (These are automatically included in the policy; the “insured” must make the claim for the following types of items rather than the owner of the items.) Personal property is covered for:
· others when the property is on the part of the “residence premises” which is occupied by the insured; and,
· guests or a "residence employee," if the property is in any residence occupied by an “insured.”
Our limit of liability for personal property usually located at an "insured's" residence, other than the "residence premises," is the greatest of 10% of the limit of liability for the personal property, or $1,000.
If an insured acquires a new principal residence, this limitation of 10% is not applicable for the first thirty days from the time you begin to actually move the personal property to the new residence.
Certain items (listed below) have specific limitations. These limits do not increase the personal property (Coverage C) limit of liability.
· money
· bank notes
· bullion
· gold other than gold ware
· silver other than silverware
· platinum
· coins and medals
· property, away from the "residence premises," used at any time or in any manner for any "business" purpose
Types of property that have coverage restricted to $1,000 include:
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Securities |
accounts |
deeds |
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Evidences of debt |
letters of credit |
notes other than banknotes |
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Manuscripts |
personal records |
passports |
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Tickets |
stamps |
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Note: This limit applies to valuable papers, regardless of how they are stored. This limit includes the cost to research, replace or restore the information from the lost or damaged material.
· watercraft, including their trailers, furnishings, equipment, and outboard engines or motors
· trailers not used with watercraft
· loss by theft of jewelry, watches, furs, and precious and semi-precious stones.
· loss to electronic apparatus, while in or upon a motor vehicle or other motorized land conveyance, if the electronic apparatus is equipped to be operated by power from the electrical system of the vehicle or conveyance while retaining its capability of being operated by other sources of power.
Electronic apparatus includes:
1. Accessories or antennas; or
2. Tapes, wires, records, discs, or other media; for use with any electronic apparatus.
· loss by theft of firearms.
· loss by theft of silverware
· silver-plated ware
· gold ware
· gold-plated ware
· pewter ware
Note: This includes flatware, hollowware, tea sets, trays, and trophies made of or including silver, gold or pewter.
· property, on the "residence premises," used at any time or in any manner for any "business" purpose
Under Coverage C—Personal Property—there are items that are excluded. These include:
· Articles separately described and specifically insured in this or other insurance.
Obviously the insurance company is not going to let an insured collect twice for the same loss. Additionally, this should encourage insureds to insure property on a policy that is most appropriate.
· Animals, birds or fish
· Motor vehicles or all other motorized land conveyances, including their equipment and accessories.
· Electronic apparatus that is designed to be operated solely by use of the power from the electrical system of motor vehicles or all other motorized land conveyances. Electronic apparatus includes:
1. Accessories or antennas; or
2. Tapes, wires, records, discs, or other media; for use with any electronic apparatus.
Note: The exclusion of property described in 1 and 2 above applies only while the property is in or upon the vehicle or conveyance. Why is this? The property is considered to be better covered elsewhere—such as in an auto policy, which generally affords coverage for permanently installed electronic apparatus.
· Aircraft and parts. Aircraft is defined as any contrivance used or designed for flight, except model or hobby aircraft not used or designed to carry people or cargo.
The only kind of coverage found in “your” homeowner’s policy relating to aircraft and aircraft parts is strictly related to hobby aircraft which CANNOT carry any passengers or cargo, in other words, models and such property as radio-controlled planes, helicopters, balloons, etc. The definition cannot be stretched to include ultra-lights and similar aircraft that some people consider to be hobby aircraft.
· Property of roomers, boarders and other tenants, except property of roomers and boarders related to an "insured."
· Property in an apartment regularly rented or held for rental to others by an "insured," except as provided in Additional Coverages.
· Property rented or held for rental to others off the "residence premises".
· "Business" data, including such data stored in:
1. Books of account,
2. Drawings or other paper records, or
3. Electronic data processing tapes, wires, records, discs or other software media.
Note: The cost of blank recording or storage media, and of pre-recorded computer programs available on the retail market is covered.
· Credit cards or fund transfer cards except as provided in Additional Coverages.
Certain types of vehicles or conveyances not subject to motor vehicle registration are covered. These are:
1. Vehicles used to service an "insured's "residence.
2. Designed for assisting the handicapped.
The limit of liability for Coverage D is the total limit for all the coverages that follow:
If a loss covered under loss of use coverage makes that part of the "residence premises" where “you” reside unfit for living, “we” cover “your” choice of either of the following:
· Additional Living Expenses: These are expenses over and above “your” normal living expenses that allow “you” to maintain “your” current (or normal) standard of living. In other words, the insurance company will not allow you to incur additional living expenses to vacation in Bermuda in a villa with a private beach while “your” two-bedroom bungalow is being rebuilt after a fire. The insurance company will consider expenses related to living away from home such as meals (staying in a hotel and eating out every day) and laundry (paying to have “your” laundry done since “your” washer and dryer is not available), etc.
· Fair Rental Value: This is the fair rental value of that part of the "residence premises" where “you” reside less any expenses that do not continue while the premise is unfit for living.
Note: This coverage is available only if the “residence premises” is “your” principal place of residence. If not, this option will not be available.
Payment under additional living expenses or fair rental value will be for the shortest of the time required to repair or replace the damage; or, if “you” permanently relocate, the least amount of time necessary for “your” household to settle elsewhere.
If a loss covered under loss of use coverage makes the part of the "residence premises" that is rented to others or held for rental by “you” uninhabitable, “we” cover the following:
· Fair Rental Value: This is the fair rental value of that part of the "residence premises" that is rented to others or held for rental by “you,” minus the expenses that do not continue while the premises is uninhabitable. For example, during the rebuilding of the “residence premises” “you” have the utilities turned off. “You” normally pay the utilities for “your” clients. The insurance company is not going to reimburse “you” for the average cost of “your” utilities while they are turned off. In other words, “you” must incur an expense before being reimbursed.
Payment under fair rental value will be for the shortest time required to repair or replace that part of the premises rented or held for rental.
If a civil authority prohibits “you” from use of the "residence premises" as a result of direct damage to neighboring premises by a covered cause of loss, “we” cover the additional living expense and fair rental value loss as provided under additional living expenses and fair rental value for no more than two weeks.
The periods of time under additional living expenses, fair rental value, and civil authority are not limited by the expiration date of the policy.
There is no coverage available due to the cancellation of a lease or an agreement. In other words, “your” renter decides to break the lease and permanently reside elsewhere due to a loss. Once the property is restored, coverage for fair rental value ends. If the property sits empty for three months after being repaired, “you” will not be reimbursed for the loss due to the cancellation of “your” lease. “You” may have a cause of action against “your” tenant, but do not look to the Homeowners Special Form to provide coverage.
Reasonable expenses will be paid for the removal of:
· Debris of covered property if an insured peril that applies to the damaged property causes the loss; or
· Ash, dust or particles from a volcanic eruption has caused direct loss to a building or to property that is within a building.
This expense is included in the limit of liability that applies to the damaged property. If the amount to be paid for the actual damage to the property plus the debris removal expense is more than the limit of liability for the damaged property, an additional 5% of that limit of liability is available for debris removal expense.
Reasonable expenses will also be paid, up to $500, for the removal from the "residence premises" of:
· An insured’s tree(s) which is (are) destroyed by windstorm or hail
· A neighbor's tree(s) that is (are) blown over or around by an insured peril under Coverage C if: the tree(s) damages a covered structure.
This is an important point. If the tree doesn’t fall on a covered structure, such as a house or garage, then the insured and the insured’s neighbor will be left to determine who pays without the help of the insurance company.
Note: The limit for any one loss is $500 regardless of the number of trees. This may be an issue if a large storm damages many trees in one storm.
If covered property is damaged by an applicable insured peril, “we” will pay the reasonable cost incurred by “you” for necessary measures taken with the sole purpose of protecting the property from additional damage. If “you” have to repair other damaged property in the process, “we” will pay for those expenses only if the property repaired is covered under the policy and the damage is covered by an applicable insured peril.
This coverage does NOT increase the limit of liability that applies to the covered property or relieve “you” of “your” duties to protect the property from further damage.
Specific perils are covered for trees, shrubs, plants, or lawns on the “residence premises.” These perils are:
· Fire or lightning
· Explosion
· Riot
· Civil commotion
· Aircraft
· Vehicles not owned or operated by a resident of the "residence premises"
· Vandalism
· Malicious mischief
· Theft
For all trees, shrubs, plants, or lawns, coverage is available for up to 5% of the limit of liability that applies to the dwelling.
Note: No more than $500 of this limit will be available for any one tree, shrub or plant.
Additionally, it is important to remember that there is NO coverage for property grown for "business" purposes.
If “you” assume liability by contract or agreement for fire department charges incurred when the fire department is called to save or protect covered property from a covered peril, there is coverage of up to $500. There is no coverage if the property is located within the limits of the city, municipality or protection district furnishing the fire department response.
Note: This is considered to be additional insurance and no deductible applies to this coverage.
If covered property is being removed from premises, which is endangered by a covered peril, the property moved will have coverage for no more than thirty days. This in no way changes coverage—it just makes coverage apply while the property is being protected.
In all of the following cases, an “insured” has coverage up to $500:
· If an “insured” has a legal obligation to pay resulting from the theft or unauthorized use of credit cards issued to or registered in an “insured’s” name.
· If an “insured” has a loss which results from the theft or the unauthorized use of a fund transfer card which is issued to or registered in an "insured's" name and is used for deposit, withdrawal or transfer of funds.
Note: This is especially important when so much of our banking is done by ATMs. If an ATM card is stolen, someone might access the insured’s savings or checking account. If that happens, there is coverage in the policy for $500.
· If an "insured" has a loss caused by forgery or alteration of any check or negotiable instrument.
· If an “insured” has a loss through the good faith acceptance of counterfeit U.S. or Canadian paper currency.
The instances when credit cards and fund transfer cards are covered are not without exception. There is no coverage under the following circumstances:
· If the illegal act is committed by a person who has been entrusted with either type of card
· If an "insured" has not complied with all terms and conditions under which the cards are issued.
Note: All loss resulting from a series of acts committed by any one person or in which any one person is concerned or implicated is considered to be one loss. This is an important distinction. If an “insured’s” checkbook is stolen and fraudulent checks start cropping up everywhere, if the above limitation did not exist, the insurance company would be responsible for each and every check that is written. Assuming that one person writes all the series of fraudulent checks, there is only coverage for $500. This would also apply to a series of fraudulent ATM transactions:
· If the loss is related to the “insured’s” business
· If the loss is related to the “insured’s” own dishonesty.
Note: This is considered to be additional insurance and no deductible applies to this coverage.
Defense
The insurance company providing coverage has the right to investigate and settle any claim or lawsuit that they deem to be appropriate. When the insurance company has paid out the limit of liability, its duty to defend ends.
With respect to coverage under the credit card or fund transfer card coverage, when a suit is brought against an "insured" for liability, the insurance company providing coverage will provide a defense at its expense by a counselor or its choice.
When a suit is brought for the enforcement of payment under the forgery coverage, the insurance company providing coverage has an option to defend at its expense an "insured" or an "insured's" bank against any suit.
The insurance company will pay up to $1000 for “your” share of a loss assessment charged during the policy period against you by a corporation or association of property owners, when the assessment is made as a result of direct loss to the property, owned by all members collectively, caused by a covered peril under dwelling coverage—coverage A.
No coverage is available due to earthquake, land shock waves or tremors before, during or after a volcanic eruption.
No coverage is available for loss assessments charged against you or a corporation or association of property owners by any governmental body.
This coverage applies only to loss assessments charged against “you” as owner or tenant of the "residence premises."
Note: Regardless of the number of assessments, $1,000 is the policy limit. Condition 1. Policy Period, under SECTIONS I AND II—CONDITIONS does not apply to this coverage.
There is coverage for direct physical loss to covered property involving collapse of a building or any part of a building caused only by one or more of the following:
· Perils insured against in personal property (Coverage C). These perils apply to covered buildings and personal property for loss insured by this additional coverage;
· Hidden decay;
· Hidden insect or vermin damage;
· Weight of contents, equipment, animals, or people;
· Weight of rain which collects on a roof: or,
· Use of defective material or methods in construction, remodeling or renovation if the collapse occurs during the course of the construction, remodeling or renovation.
Loss to an awning, fence, patio, pavement, swimming pool, underground pipe, flue, drain, cesspool, septic tank, foundation, retaining wall, bulkhead, pier, wharf, or dock is not included under items b through f above unless the loss is a direct result of the collapse of a building.
What Collapse Does Not Include
· settling
· cracking
· shrinking
· bulging
· expansion
Note: This coverage does not increase the limit of liability, which applies to the damaged covered property.
Up to $100 is available for:
· The breakage of glass or safety glazing material which is part of a covered building, storm door or storm window; and
· Damage to covered property by glass or safety glazing material, which is part of a building, storm door or storm window.
This coverage does not include loss on the "residence premises" if the dwelling has been vacant for more than 30 consecutive days immediately before the loss. A dwelling being constructed is not considered vacant.
Loss for damage to glass will be settled on the basis of replacement with safety glazing materials when required by ordinance or law.
Note: This coverage does not increase the limit of liability that applies to the damaged property.
We will pay up to $2,500 for “your” appliances, carpeting and other household furnishings, in an apartment on the "residence premises" regularly rented or held for rental to others by an "insured," for loss caused only by the following named perils:
· Fire or lightning
· Windstorm or hail
What Windstorm or Hail Does Not Include
Windstorm or hail does not include loss to the property contained in a building caused by rain, snow, sleet, sand, or dust unless the direct force of wind or hail damages the building causing an opening in a roof or wall and the rain, snow, sleet, sand, or dust enters through this opening.
Coverage Restriction for Windstorm or Hail
This peril includes loss to watercraft and their trailers, furnishings, equipment, and outboard engines or motors, only while inside a fully enclosed building.
· Explosion
· Riot or civil commotion
· Aircraft, including self-propelled missiles and spacecraft
· Vehicles
· Sudden and accidental damage from smoke
Note: This does not include loss caused by smoke from agricultural smudging or industrial operations.
· Vandalism or malicious mischief
· Falling objects
Note: This does not include loss to property contained in a building unless a falling object first damages the roof or an outside wall of the building. Damage to the falling object itself is not included.
· Weight of ice, snow or sleet which causes damage to property contained in a building
· Accidental discharge or overflow of water or steam from within a plumbing, heating, air conditioning, or automatic fire protective sprinkler system or from within a household appliance.
Note: This does not include loss to the system or appliance from which the water or steam escaped; caused by or resulting from freezing except as detailed in the peril of freezing below; or on the "residence premises" caused by accidental discharge or overflow which occurs off the "residence premises." Also keep in mind that in relation to this peril, a sump, sump pump or related equipment is not included in a plumbing system.
· Sudden and accidental tearing apart, cracking, burning, or bulging of a steam or hot water heating system, an air conditioning or automatic fire protective sprinkler system, or an appliance for heating water.
Note: There is no coverage for loss caused by or resulting from freezing under this peril.
· Freezing of a plumbing, heating, air conditioning, or automatic fire protective sprinkler system or of a household appliance.
Note: There is no coverage included for loss on the "residence premises" while the dwelling is unoccupied, unless you have used reasonable care to maintain the heat in the building or shut off the water supply and drained the system and the appliances of any water.
·
Sudden and accidental damage from artificially
generated electrical current.
Note: No coverage is available for loss to a tube, transistor or similar electronic equipment.
· Volcanic eruption other than loss caused by earthquake, land shock waves or tremors.
The $2,500 limit is the MOST that will be paid in any one loss regardless of the number of appliances, carpeting or other household furnishings involved in the loss.
This section of the policy will respond to the physical causes of loss that are specifically described in Coverage Parts A and B. Consequential (indirect) loss is not eligible for coverage. However, it is not easy to determine what situations are covered. The special form contract, in essence, states that every source of physical loss is covered EXCEPT for a wide variety of circumstances.
There Is No Coverage In The Following Instances:
· If the loss involves collapse (the exception is collapse as it is treated above in the Additional Coverage Section.)
· If freezing of a plumbing, heating, air conditioning, or automatic fire-protective sprinkler system or of a household appliance, or causes the loss by discharge, leakage or overflow from within the system or appliance caused by freezing. This exclusion applies only while the dwelling is vacant, unoccupied or being constructed, unless reasonable care has been taken to maintain heat in the building or the water supply has been shut off and the appliances and the system have been drained of water.
· If the loss is caused by freezing, thawing, pressure or weight of water or ice, whether driven by wind or not, to any fence, pavement, patio or swimming pool; foundation, retaining wall, or bulkhead; or pier, wharf or dock.
· Theft in or to a dwelling under construction, or of materials and supplies for use in the construction until the dwelling is finished and occupied.
· Vandalism and malicious mischief if the dwelling has been vacant for more than 30 consecutive days immediately before the loss. A dwelling that is under construction is not considered vacant.
· Any of the following:
1) Wear and tear, marring, deterioration;
2) Inherent vice, latent defect, mechanical breakdown;
3) Smog, rust or other corrosion, mold, wet or dry rot;
4) Smoke from agricultural smudging or industrial operation;
5) Discharge, dispersal, seepage, migration, release, or escape of pollutants unless the discharge, dispersal, seepage, migration, release, or escape is itself caused by a peril insured against under personal property coverage (Coverage C) of this policy. Pollutants are described as any solid, liquid, gaseous, or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals, and waste. Waste includes materials to be recycled, reconditioned or reclaimed;
6) Settling, shrinking, bulging, or expansion, including resultant cracking, of pavements, patios, foundations, walls, floors, roofs, or ceilings;
7) Birds, vermin, rodents, or insects; or
8) Animals owned or kept by an "insured."
Note: If any of the above causes water damage from a plumbing, heating, air conditioning, or automatic fire protective sprinkler system or household appliance, “we” cover loss caused by the water including the cost of tearing out and replacing any part of a building necessary to repair the system or appliance. “We” do not cover loss to the system or appliance from which this water escaped. Further, no coverage is provided if this specific situation is excluded in any other part of the policy.
Excluded under
Section I—Exclusions
Under the items above, any ensuing loss to property described in dwelling coverage (Coverages A) and other structures coverage (Coverage B) not excluded or excepted in this policy is covered
The perils listed below are perils insured for direct physical loss to the property described in Coverage C unless the loss is listed in the EXCLUSION section of this policy.
·
Fire or
lightning
·
Windstorm or
hail
What Windstorm or Hail Does Not Include
Windstorm or hail does not include loss to the property contained in a building caused by rain, snow, sleet, sand, or dust unless the direct force of wind or hail damages the building, causing an opening in a roof or wall and the rain, snow, sleet, sand, or dust enters through this opening.
Coverage Restriction for Windstorm or Hail
This peril includes loss to watercraft and their trailers, furnishings, equipment, and outboard engines or motors, only while inside a fully enclosed building.
·
Explosion
·
Riot or civil
commotion
·
Aircraft,
including self-propelled missiles and spacecraft
·
Vehicles
·
Sudden and
accidental damage from smoke
Note: This does not include loss caused by smoke from agricultural smudging or industrial operations.
·
Vandalism or
malicious mischief
·
Theft—includes
attempted theft and loss of property form a known place when it is probable
that the property has been stolen
Note:
In the following situations, theft is not covered:
· When the theft is committed by an "insured";
· When the theft is in or to a dwelling under construction;
· When the theft is to materials and supplies used for the construction of a dwelling until it is finished and occupied;
· When the theft is from the part of a "residence premises" rented by an "insured" to someone other than an "insured."
· Additional restrictions are listed for theft that occurs off of the “residence premises.” The situations that follow are restricted as explained or not covered:
1. Property while at any other residence owned by, rented to, or occupied by an "insured," except while an "insured" is temporarily living there.
2. Property of a student who is an "insured" is covered while at a residence away from home as long as the student has been there at any time during the 45 days immediately preceding the loss.
3. Watercraft, including their furnishings, equipment and outboard engines or motors.
4. Trailers and campers.
·
Falling Objects
Note: Falling objects do not include loss to property contained in a building unless a falling object first damages the roof or an outside wall of the building. Any damage to the falling object itself is not included.
· Weight of ice, snow or sleet, which causes damage to property contained in a building.
·
Accidental
discharge or overflow of water or steam from within a plumbing, heating, air
conditioning, or automatic fire protective sprinkler system or from within a
household appliance.
Note: This does not include loss to the system or appliance from which the water or steam escaped; caused by or resulting from freezing except as detailed in the peril of freezing below; or on the "residence premises" caused by accidental discharge or overflow which occurs off the "residence premises." Also keep in mind that in relation to this peril, a sump, sump pump or related equipment is not included in a plumbing system.
· Sudden and accidental tearing apart, cracking, burning, or bulging of a steam or hot water heating system, an air conditioning or automatic fire protective sprinkler system, or an appliance for heating water.
Note: There is no coverage for loss caused by or resulting from freezing under this peril.
·
Freezing of a
plumbing, heating, air conditioning, or automatic fire protective sprinkler
system or of a household appliance.
Note: This peril does not include loss on the "residence premises" while the dwelling is unoccupied, unless reasonable care has been taken to maintain heat in the building and the water supply has been shut off and the appliances have been drained of water.
·
Sudden and
accidental damage from artificially generated electrical current.
Note: There is no coverage under this peril for loss to a tube, transistor or similar electronic component.
· Volcanic eruption other than loss caused by earthquake, land shock waves or tremors.
This section is of extreme importance. The question often posed by insureds is, “Is this covered by my policy?” In order to answer this question, the first place to look is in the Exclusions section of the policy.
Both direct and indirect loss by any of the following is not covered. Such loss is excluded regardless of any other cause or event contributing concurrently or in any sequence to the loss. Ordinance or Law: defined as the enforcement of any ordinance or law regulating the construction, repair, or demolition of a building or other structure, unless specifically provided under this policy.
·
Earth Movement:
defined as an earthquake, and includes land shock waves or tremors that occur
before, during or after a volcanic eruption; landslide; mine subsidence;
mudflow; earth sinking, rising or shifting, unless direct loss by fire or
explosion; or if breakage of glass or safety glazing material which is part of
a building, storm door or storm window ensues, and then we will pay only for the ensuing loss.
Note: This exclusion does not apply to loss by theft.
· Water Damage: defined as flood, surface water, waves, tidal water, overflow of a body of water, or spray from any of these, whether or not driven by wind; water which backs up through sewers or drains or which overflows from a sump; or water below the surface of the ground, including water which exerts pressure on or seeps or leaks through a building, sidewalk, driveway, foundation, swimming pool, or other structure.
Note: Direct loss by fire, explosion or theft resulting from water damage is covered.
· Power Failure: defined as the failure of power or other utility service if the failure takes place off the "residence premises." But, if a peril insured against ensues on the "residence premises," we will pay only for that ensuing loss.
· Neglect: defined as any neglect of the "insured" to use all reasonable means to save and preserve property at and after the time of a loss.
· War: defined as any of the following and any consequence of any of the following: undeclared war, civil war, insurrection, rebellion, or revolution; warlike act by a military force or military personnel; or destruction, seizure or use for a military purpose. Even if accidental, discharge of a nuclear weapon will be deemed a warlike act.
· Nuclear Hazard: the full definition and extent is explained in the nuclear hazard clause of SECTION I—CONDITIONS.
· Intentional Loss: defined as any loss arising out of any act committed by or at the direction of an "insured”; and with the intent to cause a loss.
We do not insure for loss to property described in Coverages A—Dwelling and Coverages B—Other Structures that is caused by any of the following. However, any ensuing loss to property described in Coverages A—Dwelling and Coverages B—Other Structures, which is not excluded or excepted in the policy, is covered.
· Weather conditions: This exclusion only applies if weather conditions contribute in any way with a cause or event excluded under Section I—Exclusions, Paragraph 1: “Both direct and indirect loss by any of the following is not covered. Such loss is excluded regardless of any other cause or event contributing concurrently or in any sequence to the loss.”
· Acts or decisions, including the failure to act or decide, of any person, group, organization, or governmental body.
· Faulty, inadequate or defective planning, zoning, development, surveying, siting, design, specifications, workmanship, repair, construction, renovation, remodeling, grading, compaction materials used in repair, construction, renovation or remodeling; or maintenance of part or all of any property whether on or off the "residence premises.
1. Insurable Interest and Limit of Liability—Regardless of the number of people who have an insurable interest in the property covered, “we” will not be liable in any one loss:
· To the "insured" for more than the amount of the "insured's" interest at the time of loss; or
·
For more than the applicable limit of liability.
2. “Your” Duties After Loss—In case of a loss to covered property, the “insured” is responsible for:
· Giving prompt notice to the insurance company or the insurance company’s agent;
· Notifying the proper authorities in case of loss by theft;
· Notifying the credit card or fund transfer card company in case of loss under credit card or fund transfer card coverage;
· Protecting the property from further damage. If repairs to the property are required, the insured is required to:
1. Make reasonable and necessary repairs to protect the property; and
2. Keep an accurate record of repair expenses.
· Preparing an inventory of damaged personal property. The inventory must show the quantity, description, actual cash value and amount of loss. The “insured” should also attach any bills, receipts and related documents that will justify the figures reported in the inventory.
· As often as is required by the insurance company, the insured must:
- Show the damaged property;
- Provide the insurance company with records and documents that they request and allow them to make copies; and,
- Submit to and sign examination under oath, while not in the presence of any other "insured.”
Sending to us, within 60 days after “our” request, “your” signed, sworn proof of loss which describes, to the best of “your” knowledge and belief:
· The time of loss;
· The cause of loss;
· The interest of the "insured" and all others in the property involved;
· The parties, which have liens on the property;
· Information regarding any other insurance, which may cover the loss;
· The details of any changes in title or occupancy of the property during the term of the policy;
· Any specifications of damaged buildings and detailed repair estimates;
· The inventory of damaged personal property as described in the inventory described in “Your Duties After Loss” section;
· Valid receipts for additional living expenses incurred and records that support the fair rental value loss; and
· Any evidence or affidavit that supports a claim under the credit card, fund transfer card, forgery and counterfeit money coverage, which verifies the amount and the cause of loss.
3. Loss Settlement: Covered property losses are settled as follows:
The following types of property are paid at
actual cash value at the time of loss but not more than the amount required to
repair or replace:
· Personal property;
· Awnings, carpeting, household appliances, outdoor antennas, and outdoor equipment, whether or not attached to buildings; and
· Structures that are not buildings.
Note: The actual cash value is the replacement cost of the item minus depreciation. If “your” client has a ten-year-old sofa that is destroyed in a fire, the insurance company won’t just write out a check for the value of a new sofa. If they did that, “your” client would actually come out ahead. The purpose of insurance is to make “you” whole again or to bring “you” back to where “you” were before...not make things better.
Buildings that are listed under dwelling
coverage (Coverage A) or other structures coverage (Coverage B) are covered at
replacement cost without deduction for depreciation, subject to the following
conditions:
At the time of loss, if the amount of insurance in this policy on the damaged building is 80% or more of the full replacement cost of the building immediately before the loss, the insurance company will pay the cost to repair or replace, after application of deductible and without deduction for depreciation. In no case will the insurance company pay more than:
· The limit of liability under this policy that applies to the building;
· The replacement cost of that part of the building damaged for like construction and use on the same premises; or
· The necessary amount actually spent to repair or replace the damaged building.
At the time of loss, if the amount of insurance in this policy on the damaged building is less than 80% of the full replacement cost of the building immediately before the loss, the insurer will never pay more than the limit of liability under this policy. However, the company is obligated to pay the greater of the following amounts:
· The actual cash value of that part of the building damaged; or
· That proportion of the cost to repair or replace, after application of deductible and without deduction for depreciation of the part of the building damaged, which the total amount of insurance in this policy on the damaged building bears to 80% of the replacement cost of the building.
To determine the amount of insurance required to equal 80% of the full replacement cost of the building immediately before the loss, do not include the value of:
· Excavations, foundations, piers, or any supports which are below the undersurface of the lowest basement floor;
· Those supports in the above which are below the surface of the ground inside the foundation walls, if there is no basement; and
· Underground flues, pipes, wiring, and drains.
The
insurance company will pay no more than the actual cash value of the damage
until actual repair or replacement is complete. Once actual repair or
replacement is complete, the insurance company will settle the loss according
to the provisions discussed above. If, however, the cost to repair or replace
the damage is less that 5% of the amount of insurance in this policy on the
building and less than $2,500, the
loss will be settled according to the provisions listed above, regardless of
whether actual repair or replacement is complete.
An insured may disregard the replacement cost loss settlement provisions and make claim under this policy for loss or damage to buildings on an actual cash value basis. The “insured” may then make claim within 180 days for any additional liability that is incurred.
Note: Reading over the above paragraphs emphasizes the point that
it is very important to do a professional assessment of the replacement cost of
the property. Many agents rely on their clients to tell them how much insurance
is on the house currently. What if it is underinsured? Each home “you” insure
should have an evaluation done to determine the proper amount for which it
should be insured.
4. Loss to a Pair or Set—In case of loss to a pair or set, the insurance company may choose to:
· Repair or replace any part of the pair or set which will restore the pair or set to its value before the loss; or
· Pay the difference between actual cash value of the property before and after the loss.
5. Glass Replacement—Loss for damage to glass caused by a peril insured against will be settled on the basis of replacement with safety glazing materials when required by ordinance or law.
6. Appraisal—If the “insured” and the insurance company fail to agree on the amount of loss, either may demand an appraisal of the loss. In this event, each party will choose a competent appraiser within 20 days after receiving a written request from the other. The two appraisers will choose an umpire. If they cannot agree upon an umpire within 15 days, the insurance company or the “insured” may request that the choice be made by a judge of a court of record in the state where the "residence premises" is located. The appraisers will separately set the amount of loss. If the appraisers submit a written report of an agreement to the insurance company, the amount agreed upon will be the amount of loss. If they fail to agree, they will submit their differences to the umpire. A decision agreed to by any two would set the amount of loss. Each party will pay its own appraiser and bear the other expenses of the appraisal and the umpire equally.
Note: There has been an interesting trend developing regarding appraisals. This clause has traditionally been thought of as an effective measure to help control the frequency of insureds turning to litigation to resolve disputes. However, various states are now passing laws requiring that, in case of binding appraisal decisions that both the insurer and the insured have to agree to an appraisal.
7. Other Insurance: If a loss covered by this policy is also covered by other insurance, the insurance company will pay only the proportion of the loss that the limit of liability that applies under this policy bears to the total amount of insurance covering the loss.
8. Suit Against Us: No action can be brought unless the policy provisions have been complied with and the action is started within one year after the date of loss.
Note: This provision does not prevent a policy- holder from suing his insurance carrier. The intent of this provision is to make certain that an insured takes every course of action that is available and to use a lawsuit as a last resort. It should be to everyone’s advantage if conflicts can be resolved without having to go to court. However, suits happen and if this alternative is chosen, the insured must file the action within one year of the applicable date of loss.
9. “Our” Option: If the “insured” is given written notice within 30 days after the insurance company receives the “insured’s” signed, sworn proof of loss, the insurance company may repair or replace any part of the damaged property with similar property.
Note: It is important to let a client know that the insurance company is not obligated to pay a loss with cash. The insurance company can actually replace the damaged property with new or like property.
10. Loss Payment: The insurance company will adjust all losses with the “insured.” The insurance company will pay the “insured” unless some other person is named in the policy or has a legal right to receive payment. All losses will be payable 60 days after the insurance company receives the “insured’s” proof of loss and after:
The insurance company reaches an agreement with the “insured.” "Insured" means “you” and residents of “your” household who are your relatives or other persons under the age of 21 and in the care of any person who meets the definition of “insured.”
· An entry of final judgment is entered; and,
· The insurance company receives filing of an appraisal award.
11. Abandonment of Property: The insurance company is not required to accept any property, which is abandoned by the “insured.”
12. Mortgage Clause: A trustee is included in the definition of the word "mortgagee."
If a mortgagee is named in the policy, any loss payable under dwelling coverage (Coverage A) or other structures coverage (Coverage B) will be paid to the mortgagee and the insured, as interests appear. If there are multiple mortgagees, the order of payment will be the same as the order of precedence of the mortgages.
If the insurance company denies the “insured’s” claim, that denial will not apply to a valid claim of the mortgagee, if the mortgagee:
· Notifies the insurance company of any change in ownership, occupancy or substantial change in risk of which the mortgagee is aware;
· Pays any premium due under this policy on demand if the “insured” has neglected to pay the premium; and
· Submits a signed, sworn statement of loss within 60 days after receiving notice from the insurance company of the “insured’s failure to do so.
Policy conditions relating to appraisal, suits against us, and loss payment apply to the mortgagee.
If the insurance company decides to cancel or not to renew the policy, the mortgagee will be notified at least 10 days before the date cancellation or nonrenewal takes effect.
If the insurance company pays the mortgagee for any loss and denies payment to the “insured”, the insurance company subrogates all rights of the mortgagee granted under the mortgage on the property; or it is the insurance company’s prerogative to pay the mortgagee the entire principal balance on the mortgage along with any accrued interest. If the latter happens, the insurance company will require a full assignment and transfer of the mortgage and all securities that are currently held as collateral to the mortgage debt.
Subrogation will not impair the right of the mortgagee to recover the full amount of the mortgagee's claim.
13. No Benefit to Bailee: The insurance company will not recognize any assignment or grant any coverage that benefits a person or organization holding, storing or moving property for a fee regardless of any other provision of this policy.
14. Nuclear Hazard Clause:
"Nuclear hazard" is defined as any nuclear reaction, radiation, or radioactive contamination, all whether controlled or uncontrolled or however caused, or any consequence of any of these.
Any loss caused by nuclear hazard as it is defined will not be considered loss caused by fire, explosion, or smoke, whether or not these perils are specifically named in or otherwise included within Section I—which names the perils insured against in this policy.
This policy does not apply under Section I to loss caused directly or indirectly by nuclear hazard. The one exception is that direct loss by fire resulting from the nuclear hazard is covered.
15. Recovered Property: If the “insured” or the insurance company recovers any property for which the insurance company has made payment under this policy, the “insured” or the insurance company will notify the other of the recovery. At the option of the “insured”, the property will be returned to or retained by the “insured” or it will become the property of the insurance company. If the “insured” keeps the recovered property, the loss payment will be adjusted based on the amount received by the “insured” for the recovered property.
16. Volcanic Eruption Period: Within a 72-hour period, all volcanic eruptions that occur will be treated as one eruption.
If a claim is made or a suit is brought against an "insured" for damages because of "bodily injury" or "property damage" caused by an “occurrence” to which this coverage applies, the insurance company will:
· Pay up to its limit of liability for the damages for which the "insured" is legally liable. Damages include prejudgment interest awarded against the "insured".
· Provide a defense at the insurance company’s expense by counsel of its choice. This is true even if the suit is groundless, false or fraudulent. The insurance company has full authority to investigate and settle any claim or suit that it decides is appropriate. The insurance company’s duty to settle or defend ends when the amount that is paid for damages resulting from the "occurrence" is equal to the limit of liability in the policy.
Medical Payments to Others (Coverage F)
Within three years from the date of an accident that causes “bodily injury,” the insurance company will pay the necessary medical expenses that are incurred or medically ascertained. Medical expenses include reasonable charges for:
|
medical |
surgical |
x-ray |
|
dental |
ambulance |
hospital |
|
professional nursing |
prosthetic devices |
funeral services |
This coverage does not apply to any persons who qualify under the policy's definition of insureds and this includes household residents. However, residential (domestic) employees do qualify for coverage. Further, policy coverage applies only:
· To a person on an insured location, but that person must have an insured's permission to be on that covered location (trespassers would not qualify for coverage)
· To a person who is not on an insured location when harm is related to:
1. circumstances existing either on or immediately next to a covered location
2. a covered person's actions/activities
3. actions by a person working for an insured, while performing work as an insured's domestic employee, or
4. Actions an animal that either belongs to a covered person or for which covered person may be held responsible.
1. In the following situations, personal liability (Coverage E) and medical payments (Coverage F) do not apply to physical harm or direct damage:
· That a covered person causes, or expects to cause deliberately. Neither is there coverage for such losses that are related to a covered person's business activity.
The deliberate (intentional) act exclusion
applies to:
· Both acts and failure to act, when a business-related service or duty is involved with the loss.
· A situation connected to renting out any premises or portions of any premises. However, there is an exception when the rental is limited to an occasional basis and it is for residential purpose (lodging). The exception also applies to rental of covered location space as an office, school, studio, or private garage.
Note: The exception does not allow coverage for situations where a home designed for a single-family is used to house more than two renters or boarders.
·
Circumstances that are, in any way, related to
providing professional services
Example: An insured operates a legal office in her home. She is sued by a client who relied on the insured's legal advice on how to handle a zoning commission penalty and following the advice led to higher penalties.
· any situation involving a location that is owned or rented by an insured when that location would not fall under the meaning of "insured premises". This exclusion extends to a loss involving an ineligible premises that an insured rents out to other parties.
In other words, the liability section of the special form policy is only responsible for responding to loss exposures connected to non-business, personal activities.
· any loss connected to a motor vehicle, even trailers. The exclusion applies to vehicles an insured owns, rents, borrows, etc. It extends to all incidences of use.
· Losses due to an insured trusting any other party/entity with a motorized vehicle. This exposure is meant to be handled by either a personal or a commercial form of auto insurance, not a homeowner policy. Yet, this area is constantly challenged in the courts as a means of coverage, typically via a claim of entrustment (vicarious liability) or ambiguity (confusion over what is meant by a vehicle).
· Any loss involving an insured held vicariously liable for a minor. The exclusion applies even when the vicarious liability is due to a statute when that indirect liability involves motor vehicles. There are two exceptions. One is when the loss involves a stationary trailer (meaning one that is not being towed). The second is when the loss involves an off-road, recreational vehicle that is not subject to vehicle registration. However, such a vehicle is exempt only when it is not owned by an insured AND it is not on a covered location.
· This exclusion is inapplicable to a motorized golf cart when it is being used to play golf on a golf course or a vehicle or conveyance which is not subject to motor vehicle registration and is used to service an “insured’s” residence; designed for aiding the handicapped; or which is being held in dead storage on an “insured location.” Any loss involving ineligible watercraft is not covered. The exclusion extends to incidents alleging negligent entrustment as well as any manner of vicarious liability to minors.
The definition for excluded watercraft includes:
· watercraft that is designed to be propelled by engine power or electric motor; and,
· sailing vessels whether owned by or rented to an "insured.”
When the Excluded Watercraft Definition
Does Not Apply
This definition for excluded watercraft does not include watercraft that is not sailing vessels and which are powered by inboard or inboard-outboard engine or motor power of 50 horsepower or less which are not owned by an "insured". It also does not apply to inboard or inboard-outboard engine or motor power of more than 50 horsepower, which is not owned by or rented, to an "insured". It does not apply to one or more outboard engines or motors with 25 total horsepower or less or one or more outboard engines or motors with more than 25 total horsepower if the outboard engine or motor is not owned by an "insured". It does not apply to outboard engines or motors that exceed 25 total horsepower owned by an "insured" if:
· the “insured” acquires them prior to the policy period, and the “insured” declares them at the inception of the policy or the “insured’s” intention to insure them is reported in writing within 45 days after the acquisition of the outboard engines or motors; or,
· the “insured” acquires them during the policy period.
This coverage applies for the policy period.
Note: The definition for excluded watercraft also does not apply to sailing vessels, with or without auxiliary power that are less than 26 feet long or that are 26 feet or longer but that are not owned by or rented to an “insured”. The definition also does not include watercraft that is stored.
Personal liability (Coverage E) and medical payments to others coverage (Coverage F) do not apply to “bodily injury” or “property damage”:
·
arising out of
the ownership, maintenance, use, loading or unloading of an aircraft; **
·
the entrustment
by an "insured" of an aircraft to any person**; or
·
whether or not
statutorily imposed, vicarious liability for the actions of a child/minor using
an aircraft. **
Note: An aircraft means any contrivance used or designed for flight, except model or hobby aircraft not used or designed to carry people or cargo.
·
caused directly
or indirectly by war, including the following and any consequence of any of the
following:
·
undeclared war,
civil war, insurrection, rebellion, or revolution; a warlike act by a military
force or military personnel; destruction, seizure or use for a military
purpose.
Please Note: The discharge of a nuclear weapon will be deemed a warlike act even if accidental.
·
arising out of
the transmission of a communicable disease by an "insured";
·
arising out of
sexual molestation, corporal punishment or physical or mental abuse; or,
·
arising out of
the use, sale, manufacture, delivery, transfer, or possession by any person of
a Controlled Substance(s) as defined by the Federal Food and Drug Law at 21
U.S.C.A. Sections 811 and 812.
Controlled Substances include, but are not limited to:
· Cocaine
· LSD
· Marijuana
· all narcotic drugs
Note: This exclusion does not apply to the legitimate use of prescription drugs by a person following the orders of a licensed physician.
The exclusions designated by ** do not
apply to "bodily injury" to a "residence employee" arising
out of and in the course of the "residence employee's" employment by
an "insured.”
2. Personal liability (Coverage E) does not apply to:
· Liability for any loss assessment charged against you as a member of an association, corporation or community of property owners.
· Any contract or agreement.
Note: This exclusion does not apply to written contracts that directly relate to the ownership, maintenance or use of an "insured location" or where the liability of others is assumed by the "insured" prior to an "occurrence" unless excluded above or elsewhere in this policy.
· "Property damage" to property owned by the "insured".
· "Property damage" to property rented to, occupied or used by, or in the care of the "insured”.
Note: This exclusion does not apply to "property damage" caused by fire, smoke or explosion or “bodily injury” to any person eligible to receive any benefits that are provided on a volunteer basis or required to be provided by any “insured” under any worker’s compensation law, non-occupational disability law, or occupational disease law.
· "Bodily injury" or "property damage" for which an "insured" under this policy also is insured under a nuclear energy liability policy or would be an insured under a policy but for which the limits have already been exhausted.
A nuclear energy liability policy is one issued by any one of the following companies:
· American Nuclear Insurers
· Mutual Atomic Energy Liability Underwriters
· Nuclear Insurance Association of Canada
· Also included is any one of the successors to these companies.
· "Bodily injury" to “you” or an "insured" within the meaning of the defined definition of insured.
3. Medical payments to others (Coverage F) does not apply to "bodily injury":
· To a "residence employee" if the "bodily injury" occurs away from the “insured location” and has no relation to the fact that the “residence employee” is working for the “insured.”
· To any person eligible to receive benefits, which are voluntarily provided, or which are required to be provided under any worker’s compensation law, non-occupational disability law or occupational disease law.
· If “bodily injury” occurs from any nuclear reaction, nuclear radiation or radioactive contamination, regardless of how it is caused or whether it is controlled or uncontrolled. No coverage as a consequence of nuclear reaction, nuclear radiation or radioactive contamination.
· To any person, other than a "residence employee" of an "insured," regularly residing on any part of the "insured location."
The following items are covered in addition to the limits of liability which appear in the policy:
In relation to claims, the policy will pay expenses that the insurance company incurs and any costs that are assessed against an “insured” in any suit that the insurance company defends:
· Any premiums on bonds which are required in any suit that the insurance company defends; however, coverage is not available in excess of the limit of liability found under Coverage E. Additionally, it is not the responsibility of the insurance company to apply for or to furnish any bond.
· Reasonable expenses that are incurred by an "insured" at the request of the insurance company. These include actual loss of earnings up to $50 per day for assisting the insurance company in the investigation or defense of a claim or a suit.
· If there is an entry of judgment, the insurance company will pay any interest on the entire amount that accrues before the insurance company makes payment. This amount is limited to the part of the judgment that does not exceed the limit of liability that applies for the policy.
In relation to first aid expenses, the policy will pay expenses for first aid to others incurred by an "insured" for "bodily injury" covered under this policy. “We” will not pay for first aid to “you” or any other "insured.”
In relation to damage to property of others, the policy will pay at replacement cost, up to $500 per "occurrence" for "property damage" to property of others caused by an "insured."
“We” will not pay for "property damage" under the following conditions or circumstances:
· to the extent that an amount is recoverable under Section I of this policy;
· an act that is intentionally caused by an "insured" who is 13 years of age or older;
· to property that is owned by an "insured";
· to property that is owned by or rented to a tenant of an "insured" or a resident in “your” household; or
· that arises out of a “business” pursuit of an "insured"; an act or omission in connection with a premises owned, rented or controlled by an "insured”, other than the "insured location"; or the ownership, maintenance, or use of aircraft, watercraft or motor vehicles, or all other motorized land conveyances.
Note: This exclusion does not apply to a motorized land conveyance designed for recreational use off public roads, not subject to motor vehicle registration and not owned by an "insured”.
In relation to loss assessment, the policy will pay up to $1000 for “your” share of loss assessment charged during the policy period against “you” by a corporation or association of property owners, when the assessment is made as a result of "bodily injury" or "property damage" not excluded under Section II (liability) of this policy. It will also pay for the liability for an act of a director, officer or trustee in the capacity as a director, officer or trustee, provided that the director, officer or trustee is elected by the members of a corporation or association of property owners; and the director, officer or trustee serves without deriving any income from the exercise of duties which are solely on behalf of a corporation or association of property owners.
Note: This coverage applies only to loss assessments charged against “you” as owner or tenant of the "residence premises."
The policy will not cover loss assessments charged against “you” or a corporation or association of property owners by any governmental body.
Regardless of the number of assessments, the limit of $1000 is the most “we” will pay for loss arising out of:
· one accident, including continuous or repeated exposure to substantially the same general harmful condition; or,
· a covered act of a director, officer or trustee.
Note: An act involving more than one director, officer or trustee is considered to be a single act.
The following do not apply to this coverage:
Section II—Coverage E—Personal Liability Exclusion 2.a. (1) and Condition 1. Policy Period, under SECTIONS I AND II—CONDITIONS Policy Period. This policy applies only to loss in Section I or “property damage” in Section II, which occurs during the policy period.
Limit of Liability
The total liability under Coverage E for all damages resulting from any one "occurrence" will not be more than the limit of liability for Coverage E as shown in the declarations.
This limit is the same, regardless of the number of "insureds," claims made or persons injured. All "bodily injury" and "property damage" resulting from any one accident or from continuous or repeated exposure to substantially the same general harmful conditions shall be considered to be the result of one "occurrence."
The total liability under Coverage F for all medical expense payable for "bodily injury" to one person as the result of one accident will not be more than the limit of liability for Coverage F as shown in the declarations.
Severability of Insurance
This insurance applies separately to each "insured." This condition will not increase the limit of liability for any one "occurrence."
Duties After Loss
In case of an accident or "occurrence," the "insured" will be required to:
· Give written notice to the insurance company or the agent as soon as is practical. This information should include:
(1) The identity of the policy and "insured.”
(2) Reasonably available information on the time, place and circumstances of the accident or "occurrence".
(3) Names and addresses of any claimants and witnesses.
· Promptly forward to the insurance company every notice, demand, summons, or other process relating to the accident or "occurrence."
· At the request of the insurance company, the “insured” must help:
(1) To make settlement;
(2) To enforce any right of contribution or indemnity against any person or organization who may be liable to an “insured;”
(3) With the conduct of suits and attend hearings and trials; and,
(4) To secure and give evidence and obtain the attendance of witnesses.
· Under the coverage—Damage to Property of Others—submit to the insurance company, within 60 days after the loss, a sworn statement of loss and show the damaged property, if in the "insured's" control.
· The "insured" will not, except at the "insured's" own cost, voluntarily make payment, assume obligation or incur expense other than for first aid to others at the time of the "bodily injury."
Duties of an Injured Person—Coverage
F—Medical Payments to Others
The injured person or someone acting for the injured person will:
· Give the insurance company written proof of claim, under oath if required, as soon as is practical; and
· Authorize the insurance company to obtain copies of medical reports and records.
The injured person will submit to a physical exam by a doctor of the insurance company’s choice when and as often as “we” reasonably require.
Payment of Claim—Coverage F—Medical
Payments to Others
Payment under this coverage is not an admission of liability by an "insured" or by the insurance company.
Suit Against Us
No action can be brought against the insurance company unless there has been compliance with the policy provisions.
No one will have the right to join the insurance company as a party to any action against an "insured." Also, no action with respect to personal injury liability can be brought against the insurance company until the obligation of the "insured" has been determined by final judgment or agreement signed by us.
Bankruptcy of an Insured
Bankruptcy or insolvency of an "insured" will not relieve the insurance company of any obligations.
Other Insurance—Coverage E—Personal
Liability
This insurance is excess over other valid and collectible insurance except insurance written specifically to cover as excess over the limits of liability that apply in this policy.
Policy Period
This policy applies only to loss in Section I or "bodily injury" or "property damage" in Section II that occurs during the policy period.
Concealment or Fraud
Whether before or after a loss, the entire policy will be void if an "insured"
· Intentionally conceals or misrepresents any material fact or circumstance;
· Engages in fraudulent conduct; or
· Makes false statements relating to this insurance.
Liberalization Clause
If the insurance company makes a change, which broadens coverage under this edition of “our” policy without additional premium charge, that change will automatically apply to “your” insurance as of the date “we” implement the change in “your” state, providing that the implementation date falls within 60 days prior to or during the policy period stated in the declarations. This liberalization clause does not apply to changes implemented through introduction of a subsequent edition of “our” policy.
Waiver or Change of Policy Provisions
In order to make any waivers or changes in this policy, the waiver or change must be in writing by the insurance company to be valid. “Our” request for an appraisal or examination will not waive any of “our” rights.
Cancellation
a. “You” may cancel this policy at any time by returning it to the company or by letting “us” know, in writing, the date that cancellation is to take effect.
b. The insurance company may cancel this policy only for the reasons stated below by letting “you” know, in writing; of the date cancellation takes effect. This cancellation notice may be delivered to “you” or mailed to “you” at “your” mailing address shown in the declarations.
Note: Proof of mailing will be sufficient proof of notice.
Other conditions under which cancellation
may occur:
Non-payment of premium
When “you” have not paid the premium, the insurance company may cancel at any time by letting “you” know at least 10 days before the date cancellation takes effect.
Under 60 days of coverage
When this policy has been in effect for less than 60 days and is not a renewal with “us”, the insurance company may cancel for any reason by letting “you” know at least 10 days before the date cancellation takes effect.
Material misrepresentation
When this policy has been in effect for 60 days or more, or at any time if it is a renewal, the insurance company may cancel if there has been a material misrepresentation of fact which if known to “us” that would have caused “us” not to issue the policy; or
Substantial change in risk
If the risk has changed substantially since the policy was issued. Letting “you” know at least 30 days before the date cancellation takes effect can do this.
Any reason after one year
When this policy is written for a period of more than one year, the insurance company may cancel for any reason at anniversary by letting “you” know at least 30 days before the date cancellation takes effect.
Money refunded
When this policy is canceled, the premium for the period from the date of cancellation to the expiration date will be refunded pro rata. If the return premium is not refunded with the notice of cancellation or when this policy is returned to the insurance company, the company will refund it within a reasonable time after the date of cancellation takes effect.
Nonrenewal
The insurance company may elect not to renew this policy. They may do so by delivering to “you” written notice at least 30 days before the expiration date of this policy, or mailing to “you” at “your” mailing address shown in the declarations. Proof of mailing will be sufficient proof of notice.
Assignment
Assignment of this policy will not be valid unless “we” give “our” written consent.
Subrogation
An "insured" may waive, in writing, before a loss all rights of recovery against any person. If not waived, the insurance company may require an assignment of rights of recovery for a loss to the extent that the insurance company makes payment. If an assignment is sought, an "insured" must sign and deliver all related papers and cooperate with the insurance company.
Subrogation does not apply under Section II to medical payments to others or damage to property of others.
Death
If any person named in the declarations or the spouse, if a resident of the same household, dies:
a. The insurance company will insure the legal representative of the deceased with respect to the premises and property of the deceased covered under the policy at the time of death.
Note: "Insured" includes any member of “your” household who is an "insured" at the time of “your” death, but only while a resident of the "residence premises"; and with respect to your property, the person having proper temporary custody of the property until appointment and qualification of a legal representative.
The Coverage descriptions in this comparison are general.
Coverages are subject to applicable Policy provisions. Most of the coverage
amounts we referenced are basic limits that may be changed by endorsement.
Analysis Topic |
Form 8 (1) Modified Cov. |
Form 2 Broad Form |
Form 3 Special Form |
Form 4 Contents |
Form 3 and HO-15 |
Form 6 Unit Owners |
|
Eligible
Risks |
|
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|
Owner Occupied |
Yes |
Yes |
Yes |
N/A |
Yes |
N/A |
|
Owner’s
builders risk |
Yes |
Yes |
Yes |
N/A |
Yes |
N/A |
|
Tenant or Condo occupancy |
No |
No |
No |
Tenant |
No |
Condo |
|
Cooperative
unit-owner |
No |
No |
No |
Yes |
No |
Yes |
|
Incidental
office occupancy |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Coverage For |
|
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|
Dwelling
(One or two family) |
$15,000 min. no max. (2) |
$15,000 min. no max. (2) |
$20,000 min. no max. (2) |
N/A |
$30,000 min. no max. (2) |
N/A |
|
Related
Private Structures |
10% of dwelling limit may
be increased |
10% of dwelling limit may
be increased |
10% of dwelling limit may
be increased |
N/A |
10% of dwelling limit may
be increased |
Owned garage or storage
building $1,000 |
|
Seasonal
(secondary) dwelling in same or other state |
$10,000 minimum under
separate policy (2) |
$10,000 minimum under |
$10,000 minimum under
separate policy (2) |
$10,000 minimum under
separate policy (2) |
$10,000 minimum under
separate policy (2) |
$10,000 minimum under |
|
Personal property on premises |
50% of dwelling limit. |
50% of dwelling |
50% of dwelling limit. |
$6,000 minimum |
50% of dwelling limit. |
$6,000 minimum |
|
Personal
property away from premises (worldwide) |
Same, except 10% if
normally situated at another insured residence |
Same, except 10% if
normally situated at another insured residence |
Same, except 10% if
normally situated at another insured residence |
Same, except 10% if
normally situated at another insured residence |
Same, except 10% if
normally situated at another insured residence |
Same, except 10% if
normally situated at another insured residence |
|
Personal property at new principal residence |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Business personal property |
$2,500 on premises |
$2,500 on premises |
$2,500 on premises |
$2,500 on premises |
$2,500 on premises |
$2,500 on premises |
|
Scheduled personal articles |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Loss
of use |
10 % of dwelling |
20% of dwelling |
20% of dwelling limit |
20% of personal property
limit |
20% of dwelling limit |
40% of personal property
limit |
|
Trees, shrubs, lawns and plants |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Replacement cost on buildings |
Yes |
Yes |
Yes |
N/A |
Yes |
Building items |
|
Replacement cost on personal property |
Only by endorsement |
Only by endorsement |
Only by endorsement |
Only by endorsement |
Only by endorsement |
Only by endorsement |
|
Debris removal |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Grave markers |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Stamps, manuscripts, securities |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Vehicle powered electronic equipment |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
Analysis Topic |
Form 8 (1) Modified Cov. |
Form 2 Broad Form |
Form 3 Special Form |
Form 4 Contents |
Form 3 and HO-15 |
Form 6 Unit Owners |
|
Coverage For |
|
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|
Trailers not used with watercraft |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Watercraft, including trailer and OB motor |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Fire department service charge |
Yes $500 |
Yes $500 |
Yes $500 |
Yes $500 |
Yes $500 |
Yes $500 |
|
Credit card, fund transfer card, forgery and
counterfeit money |
Yes $500 |
Yes $500 |
Yes $500 |
Yes $500 |
Yes $500 |
Yes $500 |
|
Loss assessment |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Fire, lightning, windstorm, hail, riot,
civil commotion, aircraft |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Sonic Boom |
No |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Explosion other than boiler |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Explosion of steam boiler |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Bursting of steam or hot water appliances
and heating systems or air conditioning system |
No |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Vehicle Damage to Building |
Yes, except by occupant |
Yes |
Yes |
N/A |
Yes |
N/A |
|
Vehicle damage to fences |
Yes, except by occupant |
Yes, except by occupant |
Yes |
N/A |
Yes |
Yes, except by occupant |
|
Vehicle damage to driveways |
Yes, except by occupant |
Yes, except by occupant |
Yes, except by occupant |
Yes |
N/A |
Yes, except by occupant |
|
Vehicle damage to walks |
Yes, except by occupant |
Yes, except by occupant |
Yes |
N/A |
Yes |
Yes, except by occupant |
|
Vehicle damage to lawns, trees, shrubs,
plants |
Yes, except by occupant |
Yes, except by occupant |
Yes, except by occupant |
Yes, except by occupant |
Yes, except by occupant |
Yes, except by occupant |
|
Smoke -industrial
operations |
No |
No |
No |
No |
No |
No |
|
Smoke- fireplaces |
No |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Smoke - heating or cooking unit |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Vandalism and malicious mischief |
Yes, |
Yes, |
Yes, |
Yes, |
Yes, |
Yes, |
|
Vehicle powered electronic equipment |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Watercraft, including trailer and outboard
motor |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Fire department service charge |
Yes $500 |
Yes $500 |
Yes $500 |
Yes $500 |
Yes $500 |
Yes $500 |
|
Credit card, fund transfer card, forgery and
counterfeit money |
Yes $500 |
Yes $500 |
Yes $500 |
Yes $500 |
Yes $500 |
Yes $500 |
Analysis Topic |
Form 8 (1) Modified Cov. |
Form 2 Broad Form |
Form 3 Special Form |
Form 4 Contents |
Form 3 and HO-15 |
Form 6 Unit Owners |
|
Coverage For |
|
|||||
|
Loss assessment |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Fire, lightning, windstorm, hail, riot,
civil commotion, aircraft |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Surface water or flood |
No |
No |
No |
No |
No, except personal
property away from premises |
No |
|
Backing up of sewers or drains |
No |
No |
No |
No |
Only for personal property
away from premises |
No |
|
Discharge or overflow from plumbing (not
sprinkler) systems |
No |
Yes, excluding repair to
system |
Yes, excluding repair to
system |
Yes |
Yes, excluding repair to
system |
Yes, |
|
Rain through doors, windows, bad roof |
No |
No |
Building but not contents |
No |
Yes |
No |
|
Freezing of plumbing |
No |
Yes, except while vacant or
not occupied and heat not maintained or system drained |
Yes, except while vacant or
not occupied and heat not maintained or system drained |
Yes, except while vacant or
not occupied and heat not maintained or system drained |
Yes, except while vacant or
not occupied and heat not maintained or system drained |
Yes, except while vacant or
not occupied and heat not maintained or system drained |
|
Falling objects, including trees |
No, except from aircraft |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Weight of ice, snow, sleet |
No |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Wind damage to trees |
No |
No |
No |
No |
No |
No |
|
Collapse, as defined, of building |
No |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Landslide, mudslide |
No |
No |
No |
No |
Yes personal property only |
No |
|
Earthquake |
No, except by endorsement |
No, except by endorsement |
No, except by endorsement |
No, except by endorsement |
Yes, personal property Dwg
by endt only |
No, except by endorsement |
|
Volcanic Eruption |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Personal property damage by pets |
No |
No |
No |
No |
No |
No |
|
Residence glass or safety glazing material
breakage |
Yes, unless vacant + 30
days |
Yes, unless vacant + 30
days |
Yes, unless vacant + 30
days |
N/A |
Yes, unless vacant + 30
days |
N/A |
|
Sudden and accidental injury to electrical
appliances and fixtures |
No |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Theft of personal property |
Yes, $1000 max. for
property on premises |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Theft of unscheduled jewelry and furs |
Yes, $1000 max. any
property on premises only |
Yes, $1000 limit;
additional by endorsement |
Yes, $1000 limit;
additional by endorsement |
Yes, $1000 limit;
additional by endorsement |
$1000 under HO-15;
additional by endorsement |
Yes, $1000 limit;
additional by endorsement |
|
Theft of silverware |
Yes, $1000 max. any
property on premises only |
Yes, $2500 limit;
additional by endorsement |
Yes, $2500 limit;
additional by endorsement |
Yes, $2500 limit; additional
by endorsement |
Yes, $2500 limit;
additional by endorsement |
Yes, $2500 limit;
additional by endorsement |
|
Theft of guns |
Yes, $1000 max. any
property on premises only |
Yes, $2000 limit;
additional by endorsement |
Yes, $2000 limit;
additional by endorsement |
Yes, $2000 limit;
additional by endorsement |
Yes, $2000 limit;
additional by endorsement |
Yes, $2000 limit;
additional by endorsement |
Analysis Topic |
Form 8 (1) Modified Cov. |
Form 2 Broad Form |
Form 3 Special Form |
Form 4 Contents |
Form 3 and HO-15 |
Form 6 Unit Owners |
|
Coverage For |
|
|
|
|
|
|
|
Theft from unattended auto |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Theft of building materials, supplies |
Yes, $1,000 except under
construction and before occupancy |
Yes, except under
construction and before occupancy |
Yes, except under construction
and before occupancy |
Yes, except under
construction and before occupancy |
Yes, except under
construction and before occupancy |
Yes, except under
construction and before occupancy |
|
Theft in or to dwelling under construction |
No |
No |
No |
No |
No |
No |
|
Mysterious disappearance |
No (4) |
No (4) |
No (4) |
No (4) |
Yes |
No (4) |
|
Consequential loss to personal property
(spoilage) |
Yes if a covered peril
damages premise’s power, heating, cooling equipment |
Yes if a covered peril
damages premise’s power, heating, cooling equipment |
Yes if a covered peril
damages premise’s power, heating, cooling equipment |
Yes if a covered peril
damages premise’s power, heating, cooling equipment |
Yes if a covered peril
damages premise’s power, heating, cooling equipment |
Yes if a covered peril damages
premise’s power, heating, cooling equipment |
|
Property loss deductible ($250) |
Yes (3) |
Yes (3) |
Yes (3) |
Yes (3) |
Yes (3) |
Yes (3) |
|
Occurrence bodily injury and property damage
claims |
Yes, $100,000 basic |
Yes, $100,000 basic |
Yes, $100,000 basic |
Yes, $100,000 basic |
Yes, $100,000 basic |
Yes, $100,000 basic |
|
Liability coverage off premises for owned
recreational vehicles |
No, except cart on golf
course |
No, except cart on golf
course |
No, except cart on golf
course |
No, except cart on golf
course |
No, except cart on golf
course |
No, except cart on golf
course |
|
Negligent entrustment of motor vehicles,
aircraft and watercraft |
No |
No |
No |
No |
No |
No |
|
Vicarious parental liability for use by
child or minor of a motor vehicle, aircraft or watercraft |
No |
No |
No |
No |
No |
No |
|
Liability for transmitting a communicable
disease |
No |
No |
No |
No |
No |
No |
|
Business Liability, including day care |
Only by endorsement |
Only by endorsement |
Only by endorsement |
Only by endorsement |
Only by endorsement |
Only by endorsement |
|
Liability assumed by the insured in writing
prior to loss |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Fire legal liability |
Yes |
Yes |
Yes |
Yes |
Yes |
Yes |
|
Medical Payments |
Yes, $1,000 per person |
Yes, $1,000 per person |
Yes, $1,000 per person |
Yes, $1,000 per person |
Yes, $1,000 per person |
Yes, $1,000 per person |
|
Damage to Property of Others Coverage |
$500 replacement cost |
$500 replacement cost |
||||