It s My Personal Property... My Homeowners Covers It

Transcription

1 It s My Personal Property... My Homeowners Covers It

2 It's My Personal Property...My Homeowners Covers It Please turn off cell phones and stow away. Thanks Disclaimer The information in this outline is to be used as a guide only. Neither the author, M.A.I.A., affiliates, or any other organizations associated with this are liable for misprints, typos, interpretations held different from any person or organization. Riders, endorsements, coverage, and any policies not being able to cover exposures are the agent and company responsibilities. Timeline: 3:15-3:45 Analysis of ISO's HO form Coverage C Personal Property Limits of liability Exclusions 3:45-4:15 Limitations Endorsements to help Monday morning quarterbacking 1

3 Coverage C Personal Property ISO out of the box gives automatic coverage of 50% of the coverage A Dwelling amount. Some companies make that percentage higher when adding the Replacement Cost on Contents or enhancement endorsements. 2

4 HO C. Coverage C Personal Property 1. Covered Property We cover personal property owned or used by an "insured" while it is anywhere in the world. After a loss and at your request, we will cover personal property owned by: a. Others while the property is on the part of the "residence premises" occupied by an "insured"; or b. A guest or a "residence employee", while the property is in any residence occupied by an "insured". Let s break it down: We cover personal property Owned (it s mine) or used (it s yours) by an "insured" (named and automatic ones) while it is anywhere in the world For the perils insured 3

5 Let s break it down: After a loss and at your request, we will cover personal property owned by: a. Others while the property is on the part of the "residence premises" occupied by an "insured"; or My live in friends personal property is covered while on my residence premises while I m there. Let s break it down: After a loss and at your request, we will cover personal property owned by: b. A guest or a "residence employee", while the property is in any residence occupied by an "insured". My live in maid s personal property is covered while in my residence while I m there. 4

6 Who is an Insured You (the name appearing in window envelope) Resident spouse Resident Relatives (cousin Vinnie, son ) Residents under 21 in your care (foreign exchange student, foster child, etc.) Full-time student: Living away from the premises Was a resident of the household Under the age of 24 and related Student Relative over 23 HO 05 27* Others (Girlfriend/Boyfriend) HO 04 58* * (I like a separate HO-4) House Lot = Residence Premises Boundary stakes Residence Premises The building and grounds. 5

7 HO s Only Residence Premises Definition 11. "Residence premises" means the unit where you reside shown as the "residence premises" in the Declarations. One more thing on residence premises 11. "Residence premises" means: a. The one-family dwelling where you reside; b. The two-, three- or four-family dwelling where you reside in at least one of the family units; or c. That part of any other building where you reside; and which is shown as the "residence premises" in the Declarations. "Residence premises" also includes other structures and grounds at that location. 6

8 Claim Denials from around the country. Total loss while insured was in a nursing home (KY) $100,000+ condo rental claim (FL) 5-figure loss while home was being remodeled (AZ) $186,000 renovation claim (GA) $150,000 ten-month house rental (FL) $135,000 four-year house rental (FL) $123,000 two-year house rental (FL) $229,000 total loss with niece occupancy (MN) Small fire loss (NC) Fire loss with daughter s temporary occupancy (PA) Fire loss while house was undergoing renovation (RI) by Bill Wilson, CPCU, ARM, Virtual University, Big I ISO Tries to Help Fix the Issue, but 6 new endorsements to change policy language May not be enough Renewal department needs to ask; Who is occupying home Will they be all year Any changes contemplated or actual changes to occupancy needs to be reported to the agency If the named insured is not occupying; o Ask claims is this is ok in writing? 7

9 These are some of the other exposures the homeowner can run into that could create coverage problems; Snowbirds AirBnB.com Homeaway.com They live on the ocean or lake resort area and move out in June to rent there place for 3 months. In the past there was not much of an issue but now companies are looking into the where you reside issue to deny claims for the exposure they did not know about They underwrote the insured; not the tenant or house swapper How would customers make out in a loss like this? Ask your carriers claims departments for their opinion. So why is it a big deal today to pay attention to the policy set-up? Insurance carriers are entitled to the premium that matches the exposure Insurance carriers should make a profit to be a viable entity that is there when a loss happens Profit comes from 2 main sources Underwriting good risks Investment returns If the policy language dictates they don t have to pay Then either the insured or agency E & O will 8

10 HO Limit For Property At Other Locations a. Other Residences Our limit of liability for personal property usually located at an "insured's" residence, other than the "residence premises", is 10% of the limit of liability for Coverage C, or $1,000, whichever is greater. However, this limitation does not apply to personal property: (1) Moved from the "residence premises because it is: (a) Being repaired, renovated or rebuilt; and (b) Not fit to live in or store property in; or (2) In a newly acquired principal residence for 30 days from the time you begin to move the property there. So we are limited to 10% of coverage C when our personal property is at a secondary residence. Secondary Residences My residence I keep for work is in Pittsfield $50,000 x 10% = $5,000 2 methods to increase: HO endorsement Write an HO policy My residence is in P-Town. Coverage A is $100,000 Coverage C = $50,000 9

11 My main home is in MA where I vote and pay my taxes. I own another home in FL where I visit occasionally when I can get $49 flights The ISO HO forms give me automatic contents coverage without telling the MA carrier for 10% of the Coverage C limit. No automatic coverage for premises liability coverage for FL. What is a secondary residence limited to 10% of Coverage C? A secondary home College dorm Camper FL condo Not a newly acquired principal residence. This has a 30 day limit; but insured should buy a policy anyway? 10

12 HO b. Self-storage Facilities Our limit of liability for personal property owned or used by an "insured" and located in a self-storage facility is 10% of the limit of liability for Coverage C, or $1,000, whichever is greater. However, this limitation does not apply to personal property: (1) Moved from the "residence premises because it is: (a) Being repaired, renovated or rebuilt; and (b) Not fit to live in or store property in; or (2) Usually located in an "insured's residence, other than the "residence premises". New to Coverage C with the ISO 2011 Not included with ISO s 1991 or 2000 forms New 2011 Limiting Language Reduction in coverage. b. Self-storage Facilities Our limit of liability for personal property owned or used by an "insured" and located in a self-storage facility is 10% of the limit of liability for Coverage C, or $1,000, whichever is greater. However, this limitation does not apply to personal property: (1) Moved from the "residence premises" because it is: (a) Being repaired, renovated or rebuilt; and (b) Not fit to live in or store property in; or (2) Usually located in an "insured's" residence, other than the "residence premises". Can buy more coverage HO

13 Special Limits on Contents The List Money $200 Securities, Personal Records, Tickets, Stamps $1,500 Watercraft including trailers and equipment $1,500 Trailers not used with watercraft (utility, camping, etc.) $1,500 Jewelry $1,500 by theft Firearms $2,500 by theft Silverware, Pewterware, Etc. ware $2,500 by theft Business Property $2,500 (On Premises) - $1,500 (Off Premises) Off premises: ISO 1991 form $250, ISO 2000 form $500 Portable Electronic Equipment $1,500 Antennas, disks, media used with electronic equipment in a motor vehicle $250 Special Limits on Contents Money $200 So that after a covered loss the insured does not have the 50% limit maxed out Then they remember they had $50,000 in cash under the mattress Then the adjuster crosses out the $50,000 on the proof of loss form and Writes in $200 The insured could increase the limit to usually $1,000 on ISO s HO Increase Special Limits Endorsement 12

14 Special Limits on Contents Securities, Personal Records, Tickets, Stamps $1,500 We know you had the winning lottery number in the house but We still only pay the $1,500 after it burns up in the fire But at least we ll help with restoring copies of checks after the fire The insured could increase the limit on ISO s HO Increase Special Limits Endorsement Special Limits on Contents Watercraft including trailers and equipment $1,500 The limit is too low for even some canoes or kayaks The named perils are not enough for watercraft Larger craft may have no liability coverage Coverage is taken away for the theft off the premises like in the water next to the insureds dock Insured does not want to place a small claim on their HO policy for loss of credits or policy Have them purchase a separate watercraft policy 13

15 Special Limits on Contents Trailers not used with watercraft (utility, camping, etc.) $1,500 The limit is too low for utility and camping trailers Consider adding utility trailers to the auto policy for physical damage and liability coverage Consider adding camping trailers to a stand alone policy that sells golf cart liability coverage Coverage is taken away for the theft off the premises like in the campground or the lumber yard Insured does not want to place a small claim on their HO policy for loss of credits or policy Special Limits on Contents Jewelry $1,500 by theft Firearms $2,500 by theft Silverware, Pewterware, Etc. ware $2,500 by theft Very limited in coverage Problems perils Have them insure on ISO s HO or HO Scheduled forms 14

16 Claim Time Maria had $30,000 in jewelry stolen. Her $50,000 unendorsed HO-4 will provide how much after the loss? $30,000 - $250 deductible = $29,750 Subject to the limit of liability for theft of jewelry = $1,500 Marshall Katz One More Maria had $30,000 in jewelry vandalized. Her $50,000 unendorsed HO-4 will provide how much for her jewelry after the loss? $30,000 - $250 deductible = $29,750 Marshall Katz 15

17 Urban Legend This stuff is only covered for; Jewelry $1,500 by theft Firearms $2,500 by theft Silverware, Pewterware, Etc.ware $2,500 by theft If the property was destroyed by a tornado, fire, vandalism; there would be full coverage for the loss subject to the policy Coverage C limit of liability. Special Limits on Contents Business Property $2,500 (On Premises) - $1,500 (Off Premises) Off premises: ISO 1991 form $250, ISO 2000 form $500 If a business exposure they need business insurance 16

18 ISO s 1991 Policy 8. $2500 on property, on the "residence premises," used at any time or in any manner for any "business" purpose. The limit applies to property that used to be used for business ISO s 2000 and 2011 Policy s h. $2,500 on property, on the "residence premises", used primarily for "business" purposes. More forgiving with primarily used now Special Limits on Contents Business Property Examples Music teachers violin Golf pros clubs Auto mechanics tools Police officers gear DJ equipment 17

19 s to Be Added to Homeowners Policy Increased Special Limits HO Scheduled Personal Property HO Golf Cart HO Increased Business Personal Property HO Home Biz HO Floaters POLICY NUMBER: HOMEOWNERS HO THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. COVERAGE C INCREASED SPECIAL LIMITS OF LIABILITY SCHEDULE* SECTION I PROPERTY COVERAGES COVERAGE C PERSONAL PROPERTY 3. Special Limits Of Liability The special limits of liability are increased as noted below: Property a. Money, bank notes, bullion, gold other than goldware, silver other than silverware, platinum other than platinumware, coins, medals, scrip, stored value cards and smart cards. b. Securities, accounts, deeds, evidences of debt, letters of credit, notes other than bank notes, manuscripts, personal records, passports, tickets and stamps. e. Jewelry, watches, furs, precious and semiprecious stones for loss by theft, but not more than $1,000 for any one article. f. Firearms and related equipment for loss by theft. g. Silverware, silver-plated ware, goldware, goldplated ware, platinumware, platinum-plated ware and pewterware for loss by theft. j. Electronic apparatus and accessories, while in or upon a "motor vehicle", but only if the apparatus is equipped to be operated by power from the "motor vehicle's" electrical system while still capable of being operated by other power sources. k. Electronic apparatus and accessories used primarily for "business" while away from the "residence premises" and not in or upon a "motor vehicle". The apparatus must be equipped to be operated by power from the "motor vehicle's" electrical system while still capable of being operated by other power sources. Increase In Limit Of Liability Total Limit Of Liability Use the HO or HO Schedule instead Call the NRA (800) NRA-2000 All other provisions of this policy apply. *Entries may be left blank if shown elsewhere in this policy for this coverage. 18

20 SCHEDULED PERSONAL PROPERTY ENDORSEMENT 36 SCHEDULE* Not cash Amount Of Class Of Personal Property Insurance Premium 1. Jewelry, as scheduled below. $ $ 2. Furs and garments trimmed with fur or consisting principally of fur, as scheduled below. 3. Cameras, projection machines, films and related articles of equipment, as listed below. 4. Musical instruments and related articles of equipment, as listed below. You agree not to perform with these instruments for pay unless specifically provided under this policy. 5. Silverware, silver-plated ware, goldware, gold-plated ware and pewterware, but excluding pens, pencils, flasks, smoking implements or jewelry. 6. Golfer's equipment meaning golf clubs, golf clothing and golf equipment. 7.a. Fine Arts, as scheduled below. This premium is based on your statement that the property insured is located at the following address: at at 7.b. For an additional premium, Paragraph 5.b. under C. Perils Insured Against is deleted only for the articles marked with a double asterisk (**) in the schedule below. 8. Postage Stamps 9. Rare and Current Coins Total Fine Arts Amount $ Amount of 7.b. only $ Other things: Article Or Property Description Amount Of Insurance Sporting goods Eyes, ears and other medical Dogs Stuff company allows THE AMOUNTS SHOWN FOR EACH ITEM IN THIS SCHEDULE ARE LIMITED BY THE LOSS SETTLEMENT CONDITION IN PARAGRAPH F.2. *Entries may be left blank if shown elsewhere in this policy for this coverage. We cover the classes of personal property which are indicated in the Schedule above by an amount of insurance. This coverage is subject to the: 1. Definitions; 2. Section I Conditions; and 3. Sections I and II Conditions; in the policy and all provisions of this endorsement. Any deductible stated in this policy does not apply to this coverage. No deductible Homework Assignment 1. Ask all your carriers for; a. A book profile b. Of any HO policy with c. Fine Arts coverage d. Without breakage coverage endorsed 2. From carrier conversations 70 90% of all policies with Fine Arts coverage do not have breakage coverage 3. Why? The agency never asks for it. 19

21 A. Newly Acquired Property Jewelry, Furs, Cameras And Musical Instruments Only 1. We cover newly acquired property of a class of property already insured. The lesser of the following limits applies: a. 25% of the amount of insurance for that class of property; or b. $10, When you acquire new property you must: a. Report these objects to us within 30 days; and b. Pay the additional premium from the date acquired. B. Newly Acquired Fine Arts When Fine Arts are scheduled, we cover objects of art acquired during the policy period for their actual cash value. However, we will pay no more than 25% of the amount of insurance for fine arts scheduled. For coverage to apply for newly acquired fine arts you must: 1. Report these objects to us within 90 days; and 2. Pay the additional premium from the date acquired. T h e S c h e d u l e P e r i l s I n s u r e d Perils Insured Against Risks of direct physical loss, except Territorial Limits 2000/2011 Worldwide on everything 1991 Fine Arts limited to US & Canada May need to broaden territory to everywhere for space trips 20

22 The Schedule Loss Payments Fine Arts Agreed Value Other Property Pays least of; ACV Amount Scheduled Repair RePlace Dear Insured: Your policy for your scheduled items will be renewing shortly. Please do the following to ensure your limits are enough for you: 1. Review items below. 2. Cross out items no longer owned or desired to insure. 3. Show adjusted values and include a new appraisal. 4. Add items needing to insure and include a new appraisal. 5. Date, sign and return in the envelope provided. # Item Current Change 1 Painting 25,000 2 Vase 10,000 3 Rug 5,000 4 Hummel 2,500 September 26, 2017 Mrs. Overinsured 21

23 Corporate Headquarters: 117 Kendrick Street, Suite 250 Needham, MA Phone: Fax:

24 Collection Examples Action Figures G.I. Joe, Star Wars Advertising Memorabilia Breweriana, Coca-Cola Animation Art Disney, Warner Brothers Automobilia Gas Pumps, Vintage Signs Collector Plates Bradford Exchange, Royal Copenhagen Die Cast ERTL, Matchbox Dolls Annalee, Barbie, Madame Alexander Figurines M.I. Hummel, Swarovski, Precious Moments, Lladrό Jukeboxes Wurlitzer Militaria Helmets, uniforms, equipment Model Trains & Sets Lionel, Mike s Train House Ornaments Hallmark, Christopher Radko Pottery McCoy, Lenox Sports Memorabilia autographed pieces Teddy Bears Boyds Bears, Steiff Villages Department

25 HOMEOWNERS HO THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. PERSONAL PROPERTY REPLACEMENT COST LOSS SETTLEMENT A. Eligible Property 1. Covered losses to the following property are settled at replacement cost at the time of the loss: a. Coverage C; and b. If covered in this policy: (1) Awnings, outdoor antennas and outdoor equipment; and (2) Carpeting and household appliances; whether or not attached to buildings. 2. This method of loss settlement will also apply to the following articles or classes of property if they are separately described and specifically insured in this policy and not subject to agreed value loss settlement: a. Jewelry; b. Furs and garments: (1) Trimmed with fur; or (2) Consisting principally of fur; c. Cameras, projection machines, films and related articles of equipment; d. Musical equipment and related articles of equipment; e. Silverware, silver-plated ware, goldware, gold-plated ware and pewterware, but excluding: (1) Pens or pencils; (2) Flasks; (2) Smoking implements; or (3) Jewelry; and f. Golfer's equipment meaning golf clubs, golf clothing and golf equipment. Personal Property Replacement Cost loss settlement will not apply to other classes of property separately described and specifically insured. B. Ineligible Property Property listed below is not eligible for replacement cost loss settlement. Any loss will be settled at actual cash value at the time of loss but not more than the amount required to repair or replace. 1. Antiques, fine arts, paintings and similar articles of rarity or antiquity which cannot be replaced. 2. Memorabilia, souvenirs, collectors items and similar articles whose age or history contribute to their value. 3. Articles not maintained in good or workable condition. 4. Articles that are outdated or obsolete and are stored or not being used. C. Replacement Cost Loss Settlement Condition The following loss settlement condition applies to all property described in A. above: 1. We will pay no more than the least of the following amounts: a. Replacement cost at the time of loss without deduction for depreciation; b. The full cost of repair at the time of loss; c. The limit of liability that applies to Coverage C, if applicable; d. Any applicable special limits of liability stated in this policy; or e. For loss to any item described in A.2.a. - f. above, the limit of liability that applies to the item. 2. If the cost to repair or replace the property described in A. above is more than $500, we will pay no more than the actual cash value for the loss until the actual repair or replacement is complete. 3. You may make a claim for loss on an actual cash value basis and then make claim for any additional liability in accordance with this endorsement provided you notify us of your intent to do so within 180 days after the date of loss. All other provisions of this policy apply. Personal Property Not Covered a. Specifically insured scheduled stuff b. Animals, birds or fish (the cage or tank is ok) c. Motor vehicles not all d. Aircraft, unless hobby stuff e. Hovercraft and parts f. Property of roomers, boarders and tenants g. Property in an apartment rented h. Off-premises property rented or held for rental i. Business data j. Credit/fund transfer cards k. Water or steam 24

26 c. "Motor vehicles". This includes a "motor vehicle's" equipment and parts. However, this Paragraph 4.c. does not apply to: (1) Portable electronic equipment that: (a) Reproduces, receives or transmits audio, visual or data signals; and (b) Is designed so that it may be operated from a power source other than a "motor vehicle's" electrical system. (2) "Motor vehicles" not required to be registered for use on public roads or property which are: (a) Used solely to service a residence; or (b) Designed to assist the handicapped; New language took out insured s (2) We do cover "motor vehicles" not required to be registered for use on public roads or property which are: (a) Used solely to service a residence; or (b) Designed to assist the handicapped; What About Plows for PL? ISO s 2011 ISO s 1991/2000 c. "Motor vehicles". (1)This includes: (a) Their accessories, equipment and parts; or (b) Electronic apparatus and accessories designed to be operated solely by power from the electrical system of the "motor vehicle". Accessories include antennas, tapes, wires, records, discs or other media that can be used with any apparatus described above. The exclusion of property described in (a) and (b) above applies only while such property is in or upon the "motor vehicle". (2) We do cover "motor vehicles" not required to be registered for use on public roads or property which are: (a)used solely to service an "insured's" residence; or (b)designed to assist the handicapped; 25

27 Perils Insured Against HO ISO Coverage A Dwelling and Coverage B Detached Structures Covered unless excluded Company must prove it is not covered Coverage C Personal Property Named peril coverage Insured must prove loss was one of the 16 named perils W h a t a r e t h e P e r i l s L i s t Broad Fire or lightning Wind or hail Explosion Riot or civil commotion Aircraft Vehicles Smoke Vandalism Theft Falling objects Weight of ice & Snow Accidental discharge Sudden & accidental tearing Freezing Sudden artificial electrical current Volcanic eruption O p e n P e r i l Anything not excluded & all the Broad ones Examples of covered losses: Scorching counter with a hot pan Ice dam water damage Solar windows from a neighbor melting my siding No maintenance type losses (wear & tear) 26

28 Perils Covered At-A-Glance HO-2 HO-3 HO-4 HO-5 HO-6 Owner 1-4 Family Owner 1-4 Family Tenant Owner 1-4 Family Condo Unit Owner Coverage A Broad Special Special Broad Coverage B Broad Special Special Coverage C Broad Broad Broad Special Broad Coverage D Broad Special Broad Special Broad Coverage C Broad Perils 1) Fire or lightning 2) Windstorm or hail (WHARVES) a) Covers loss to property in a building only if there is damage to the building b) Covers loss to watercraft and their trailers and equipment only if inside a building 27

29 Broad Perils 3) Explosion 4) Riot or civil commotion 5) Aircraft 6) Vehicles 7) Smoke 8) Vandalism or malicious mischief 9) Theft Broad Perils d). Off Premises categories 1) Excludes (a). Committed by an insured (i). Property at another residence unless insured living there at time of theft b). c). In a dwelling under construction until (a). Finished, and (b). Occupied (c). Building materials for a dwelling under construction (need company buy-back) From part of residence premises rented to other than an insured (ii). Property of a student at another residence unless student has been there within ISO 1991 = 45 days ISO 2000 = 60 days ISO 2011 = 90 days (iii). Watercraft and their furnishings, etc. (not covered) (iv). Trailers and campers (not covered) 28

30 10) Falling objects Broad Perils 11) Weight of ice, snow or sleet 12) Accidental discharge or overflow of water or steam A. Does not include: 1. Loss to appliance or system 2. Caused by freezing 3. Off-premises discharge or overflow 13) Sudden and accidental tearing apart, cracking, burning or bulging of a steam or hot water heating system... 15) Artificially generated electrical current This peril does not include loss to tubes, transistors, electronic components or circuitry that are a part of appliances, fixtures, computers, home entertainment units or other types of electronic apparatus. Power surge stuff. We should be discussing the new equipment breakdown endorsement some carriers have? 16) Volcanic eruption 14) Freezing (maintain heat) Personal property endorsements for back at the office Special form computer HO Special form for HO (91) HO Special form policy HO Special form for HO HO Special form for HO HO

31 Monday morning quarterbacking after an uninsured event and when do we bring our insurance policy into play? Dial the number Tell them what agency your calling from and Let your E & O carrier guide you through the process and Our limit per occurrence is only what Questions Comments Suggestions? 30

32 Thank you for sharing your hour with MAIA and myself! Enjoy the rest of the day. 31