Revision Summary: AR Compass Below are the revisions to the current AR Compass that are now on the AR Compass 01 15

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1 Revision Summary: AR Compass Below are the revisions to the current AR Compass that are now on the AR Compass Pg # s 1 Coverage Territory (I.C.): extended to include Canada. Comment: May have some incidental exposures and Canada is allowed by contracts, provided incidental and no Canadian mailing address. 1-2 Limit of Liability (I.D.1. b - c): added 2 additional options: scheduled per item; and blanket for Property & separately blanket for BI. Comment: This now allows the UW to choose either: a) blanket by location for all Property/BI (1.a.), which is the original Compass; or b) scheduled by item (1.b.); OR c) Blanket for Property & separately, Blanket for BI (1.c.). Policy will still continue to have a maximum limit of liability (2). 2 Sublimits of Liability (I.E.): clarified at the beginning of I.E., rather than at the end, that if the words NOT COVERED are shown, then no coverage is provided. We then removed this verbiage as an actual exclusion (was II.B.30.), since we now have this as a lead in. Comment: This is a better lead in to the sublimits, rather than having it as an exclusion at the end of the section. 2 Flood Sublimit for Zone A (I.E.2.): amended to apply to Locations, instead of Building and clarified that Zones pre-fixed with A or V were SFHA s. Comment: This clarifies that SFHAs are Flood Zones pre-fixed with A or V; and now follows our Flood Zone Designation Endt that confirms the Flood Zones for each location. 2 Builder s Risk (I.E.5.): added a sublimit. Comment: Current version did not have this sublimit. While the form includes property under construction at a scheduled location (for that scheduled limit), this request for an actual Builder s Risk sublimit had been endorsed numerous times, so felt it best to just put a sublimit on it. 3&18 Builder s Risks Soft Costs (I.E.6. & V.C.4.): added a sublimit; and added accounting, licenses, permits, Business Income & Rents. Comment: A Sublimit had been endorsed on numerous times; and these 5 soft cost extensions are normal industry extensions and have been endorsed on in the past. 3 Debris Removal (I.E.9.): clarified that % limitation is applicable to PD values only and not Time Element. Comment: Clarification as to intent of the application of the Debris Removal %. 3&17 Expediting Expenses (I.E.13. & V.C.1.c.): added this to the Extra Expense sublimit and definition of Extra Expense. Comment: Current version did not have this extension, but it has been requested on numerous occasions and had been endorsed on the policy in the past. However, the Expediting Expense is included within, and not in addition, to overall Extra Expense. 1

2 3 Leased or Rented Equipment (I.E.18.): added sublimits. Comment: Current Version did not have a sublimit before, and due to numerous endt requests, just added a sublimit. 3&22 Lock Replacement (I.E.21 & VI.J.): added this extension. Comment: Current version did not have, but this extension was on the original AmRisc coverages and had been continually endorsed to the Compass. 3 Ordinance or Law (I.E.24.): separated Coverages B & C. Comment: In the past, we had to endorse this when splitting B & C. Now, it s streamlined to enable us to include it without an endt. 3 Plants, lawns, trees, or shrubs (I.E.26.): tucked the any one plant sublimit under this main sublimit; and removed the reference to Defined Causes of Loss, as this is a Limits Section and not a Perils Section. Comment: Makes better sense to have these 2 Plant extensions together; and not co-mingle references to Perils and Limits. 4&24 Reward Reimbursement (I.E.29. & VI.P.): added this extension. Comment: Current version did not have, but this extension was on the original AmRisc coverages and had been continually endorsed to the Compass. 4 Royalties (I.E.30.): added a sublimit. Comment: Current version did not have a sublimit. 4&19-20 Time Element Monthly Limitation (I.E.33. & V.E.): added this limitation. Comment: Current version did not have monthly limitation option. This limitation had been endorsed on the policy in the past. Can now add a monthly limitation (ex. 1/12 th ) to limit all Time Element coverages (except those Time Element coverages that already have a sublimit). 4 AOP Deductible (I.G.): added an option for separate deductibles for PD & TE. Comment: This allows for separate PD and BI Deductible for the AOP (ex: per day), if needed. This had been endorsed on the policy in the past. Mainly used on Tech accounts. 4 Flood Deductible: Zone A (I.G.1.b.): removed the at time of loss reference, so deductible applies to the SOV; and clarified that it applies to Zones pre-fixed A or V. Comment: Needed to clarify application of deductible, plus clarify SFHA areas, since we use Zones A & V for that purpose. Also, our Deductible is usually excess of NFIP, versus a % deductible, so this will remove the need to continually endorse. 4-5 Earth Movement Deductible (I.G.2.b-d): removed the at time of loss reference, so deductible applies to the SOV. Comment: Needed to clarify application of deductible. 2

3 5 AO Wind Deductible (I.G.3.a.): now have the option for the All Other Wind Deductible to be per Occurrence, per Location. Comment: This per Location Wind deductible had to be endorsed in the past and is used frequently, so this eliminates the need to endorse. 5 Wind & Hail Deductible (I.G.3.b&c): removed the at time of loss reference, so deductible applies to the SOV. Comment: Needed to clarify application of deductible. 5&47 TIV clause at end of Flood/ Earth Movement/ Named Wind Ded. (I.G.3.): removed this paragraph being The TIV shall include all values.... Comment: Total Insurable Values is now included in the Definitions Section. 5 Last Sentence in Final paragraph at end of Deductible Section (I.G.): added that if both a TE and another deductible apply to the same occurrence, then both deductibles would apply. Comment: Clarified that a separate TE Deductible applies, in addition to the Property deductible. 5-6 Nuclear, Biological, Chemical, Radioactive Exclusion (II.B.1.): replaced with the ISO version, which excludes these 4 perils, but covers Fire following (if an insured peril) if state law requires that Fire following be covered. Comment: This verbiage was a carrier requirement, so added it permanently to Compass, and it acknowledges state statutes regarding Fire following. 8-9 Electronic Data Exclusion (II.B.16.): clarified that this excludes only Computer Virus. Comment: This was incorrectly an absolute exclusion for all perils, rather than Computer Virus, so corrected it,.as policy does cover EDP Media. 9 Fungus/Mold Exclusion (II.B.18.): this exclusion will no longer apply to Flood, provided Flood is a covered peril. Comment: This had been endorsed in the past. It is expected that Fungus/Mold caused from Flood should be covered, if Flood is a Covered Peril. 11 Hot Testing exclusion (II.B.29.): added this exclusion. Comment: Current version did not have this exclusion, but this was needed for some exposures. 11 Manufacturer s Warranty Exclusion (II.B.30.): added this exclusion. Comment: Clarifies that no coverage for manufacturer s warranty or guarantee. 11 Named Storm Restriction (II.B.31.): tightened the wording. Comment: Feedback from carriers regarding tightening the intent of this wording Covered Property (III.A.1,2&6): added or renovation, equipment, Improvements & Betterments, Property of the Insured temporarily at other locations, including Property on Exhibits & Salesman s Samples to definition of Covered Property. Comment: These items had been endorsed in the past and we need to clarify that they were covered. Policy now also has a sublimit for Leased or Rented Equipment. 3

4 12 Property Excluded (III.B.2.): now, also excludes any alteration to the natural condition of land. Comment: Clarified intent of land exclusion. 12 Paved surfaces, walkways, drainage systems (III.B.5.): added these 3 items to the Pavements exclusion. Comment: Current version did not have and needed to clarify that paved surfaces & walkways were considered pavements. Drainage systems were also added. 12 Transmission Lines Exclusion (III.B.14.): added Support structures to this exclusion. Comment: Clarified that T & D support structures are also not covered Condo Unit-Owners Exclusion (III.B.17.): added exclusion for Condo unit-owners personal property. Comment: Compass form did not address this exposure and intent is to not cover. 13 Valuation (Section IV): added clause in lead in paragraph stating that valuation is ACV unless repaired, rebuilt or replaced as soon as possible; added 180 day time frame to revert back to RCV from ACV. Comment: Needed to get this in line with more standard valuation intent (i.e. ACV, unless replaced). 14 Fine Arts (IV.H.3.): added a Pair or Set clause. Comment: added the normal Pair or Set clause, as Compass did not have one. 15 Catalyst (IV.M.): added Valuation clause for Catalyst. Comment: Current version did not have this valuation, and it needed to be addressed for some Tech accounts. 15 Gross Earnings (V.A.1. last Par re Ordinary Payroll): clarified that the Payroll values must be included in the Time Element values and the # of days need not be consecutive. Comment: Needed to clarify the 90 day period Royalties (V.C.3.): added Valuation clause. Comment: Clarified how Royalties loss will be determined. 18 Civil Authority (V.C.6.): clarified that it related to a covered Location, is limited to 5 statute miles and added that this coverage ends when order expires. Comment: Current version did not have a mileage limitation, plus needed to clarify when coverage expires. Removed reference to sublimit, as that is addressed in sublimit section Ingress/Egress (V.C.7.): clarified that it related to a covered Location, is limited to 5 statute miles and added that this coverage ends when ingress/egress is no longer prohibited. Comment: Current version did not have a mileage limitation, plus needed to clarify when coverage expires. Removed reference to sublimit, as that is addressed in sublimit section. 19 Extended Period of Indemnity (V.C.8.): it now applies to Rental Value (in addition to Gross Earnings), and does not cover increase in loss due to fines/penalties. Comment: Current version did not have this, but the EPOI extension should also apply to Loss of Rents. Extension should not apply to fines & penalties. 4

5 19 Berth and/or Port Blockage (V.D.5.): added exclusion to clarify intent to exclude Port/Berth Blockage. Comment: Exclusion clarifies intent of Compass to not cover this exposure. 21 Fine Arts (VI.E): added sculptures, antique furniture & antique jewelry to Fine Arts. Comment: Clarified that sculptures, antique furniture and antique jewelry were also considered Fine Arts, since certain additional exclusions apply to Fine Arts. 22 Newly Acquired (VI.K.): removed the Named Storm exclusion. Comment: Intent of policy is to provide similar coverages ot Newly Acquired property. 23 Service Interruption (VI.Q.): clarified that this extension also applies to Time Element, including Rental Value. Restricted this extension to not apply to damage to utilities if more than 5 statute miles from the insured Locations. Comment: Our intent is to include Time Element for this extension; plus added a 5 mile limitation. 28 Currency (VII.I.): removed reference to other countries and currency. Comment: Policy is for USA Insureds, so removed any foreign currency reference Loss Payees, Lender s Loss Payees, and Mortgagees (or Trustees) (VII.M.): added this clause for clarification as to the rights of various parties. Comment: We have endorsed this on in the past, so added these clauses permanently, so as to lessen endorsements Subrogation (VII.W.): waived subrogation against condo unit-owners; and did not waive subrogation as respects Architects/Engineers or Manufacturers. Comment: Condo Association coverage automatically waives rights against unit-owners, so clarified that was also our intent. Did not want to waive it as respects architects/engineers or manufacturers. 33 Vacancy Clause (VII.AA.): added this clause. Allows Vacancy up to 90 days without notification to AmRisc. After 90 days, the deductible is the greater of: double the applicable peril deductible; or $100,000. Comment: Current version did not have a Vacancy Clause. Now allows it, with higher deductible Average Daily Value (VIII.C.): added this definition as it may now be used in the Deductible section. Comment: Needed this definition, as some Tech accounts may have an ADV day deductible, and this has had to be endorsed in the past. 34 Catastrophic Ground Cover Collapse (VIII.E.): added this definition, as the Collapse definition/coverage now includes this peril. Comment: Current version does not have this. Considering the Florida exposures and issues with Sinkhole, this needed to be addressed, as this is the minimum coverage expected in Florida. 34 Collapse (VIII.F.): clarified the definition and also extended the definition to include Catastrophic Ground Cover Collapse. Comment: Current version did not have this definition, plus needed to include the Catastrophic Ground Cover Collapse, as that is the minimum expected in Florida. 5

6 35 Earth Movement (VIII.I.): removed Tsunami from the Earth Movement definition and moved it to the Flood definition. Added resulting Sprinkler Leakage as part of Earth Movement definition. Comment: Tsunami as considered Flood, rather than Earth Movement. Clarified that resulting sprinkler leakage from Earth Movement is part of Earth Movement (and included in its sublimit and deductible). 35 Earth Movement Counties (VIII.J.2.): added 2 counties Trigg, Co., KY and St. Louis Co., MO. Comment: Further clarified the New Madrid area EIFS (VIII.N.): Clarified the definition a little better. Comments: Used the EIMA website for the definition, but still refer to that website. 37 Fine Arts (VIII.O.): added a definition of Fine Arts. Comment: Current version does not have this. Needed to define this property, as there are some specific exclusions for Fine Arts. 37 Flood (VIII.P.): added Tsunami (see Earth Movement comment above) and clarified Backup of Sewers & Drains. Comment: Tsunami should be considered Flood. Current form does not exclude Backup of Sewers. Clarified that intent is to cover normal backup of sewers, but not cover Flood backup of sewers (unless Flood is covered) Sinkhole Loss (VIII.AA.): added definition. Comment: Sinkhole Loss is still part of the Earth Movement definition, and subject to Earth Movement Deductible & sublimit. However, current version did not have a Sinkhole Loss definition, so we added one for Florida and one for the other states. The Florida wording follows most recent ISO wording. 44 Special Flood Hazard Areas (VIII.CC.): added definition. Comments: Moved this to the Definitions Section, rather than repeating it several times in the policy body Tier 1 & 2 (VIII.DD.): added definition for these counties/parishes. Comment: Current version did not have the Tier 1 & 2 counties/parishes defined Various revisions: made some grammatical revisions/clarifications. Also, alphabetized the clauses and sublimits, so some clauses were moved around within the Sections. 6