DWELLING EARTHQUAKE COVERAGE FORM

Transcription

1 THIS IS A LIMITED COVERAGE POLICY. PLEASE READ IT CAREFULLY DWELLING EARTHQUAKE COVERAGE FORM INSURING AGREEMENT We will provide the insurance described in this policy in return for the premium and compliance with all applicable provisions of this policy. DEFINITIONS Throughout this policy, you and your refers to the named insured shown on the Declaration page. We, us and our refers to the Company providing the insurance, as indicated on the Declaration page. Earthquake means shaking or trembling of the earth, whether caused by volcanic activity, tectonic process or any other cause. Pollutants means any solid, liquid, gaseous, or thermal irritant or contaminant including smoke, vapor, soot, fumes, acid, alkalis, chemicals and waste. Waste includes material to be recycled, reconditioned or reclaimed. "Business" means a. a trade, profession or occupation engaged in on a full-time, part-time or occasional basis; or b. Any other activity engaged in for money or other compensation, except the following: I. One or more activities, not described in (II) through (IV) below, for which no "insured" receives more than $2,000 in total compensation for the 12 months before the beginning of the policy period; II. Volunteer activities for which no money is received other than payment for expenses incurred to perform the activity; III. Providing home day care services for which no compensation is received, other than the mutual exchange of such services; or IV. The rendering of home day care services to a relative of an "insured". Actual Cash Value means: a. When the damage to property is economically repairable, actual cash value means the cost of repairing the damage, less reasonable deduction for wear and tear, deterioration and obsolescence. b. When the loss or damage to property creates a total loss, actual cash value means the market value of property in a used condition equal to that of the destroyed property, if reasonably available on the used market. c. Otherwise actual cash value means the market value of new, identical or nearly identical property less reasonable deduction for wear and tear, deterioration and obsolescence. "Replacement Cost" a. In case of loss or damage to buildings, replacement cost means the cost, at the time of loss, to repair or replace the damaged property with materials of like kind and quality, without deduction for depreciation. b. In case of loss to personal property, replacement cost means the cost, at the time of loss, of a new article identical to the one damaged or destroyed. When the identical article is no longer manufactured or is no longer available, replacement cost shall mean the cost of a new article similar to the one damaged or destroyed and which is of comparable quality and function, without deduction for depreciation. "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 PROPERTY COVERAGES This insurance applies to the Residence Premises Location in the Declarations, Coverages for which a Limit of Liability is shown and Perils Insured Against for which a Premium is stated in the Declarations. A. Coverage A - Dwelling We cover: a. the dwelling on the residence premises shown in the Declarations, including structures attached to the dwelling; and b. structures attached to the dwelling. We do not cover: a. land, including land on which the dwelling is located, except as noted under Additional Coverages, Land Stabilization; any diminution of land value, landscaping, trees, shrubs, lawns or plants, even if damaged by the repair process; b. swimming pools, hot tubs, masonry fences, walkways and patios not necessary for the regular entry or exit of the dwelling, awnings or other patio coverings and any loss in value to the dwelling due to the requirements of any ordinance or law DEQ AXS GUS COMP (11/06) Page 1 of 7

2 B. Coverage B - Other Structures We cover other structures on the residence premises set apart from the dwelling by clear space. This includes structures connected to the dwelling by only a fence, utility line, or similar connection. We do not cover: a. land, including land on which the dwelling is located, except as noted under Additional Coverages, Land Stabilization; any diminution of land value, landscaping, trees, shrubs, lawns or plants, even if damaged by the repair process; b. other structures rented or held for rental by any person not a tenant of the dwelling, unless used solely as a private garage; c. other structures from which any business is conducted d. land used in whole or in part for commercial, manufacturing or farming purposes; or e. other structures used to store "business" property. However, we do cover a structure that contains "business" property solely owned by an "insured" or a tenant of the dwelling provided that "business" property does not include gaseous or liquid fuel, other than fuel in a permanently installed fuel tank of a vehicle or craft parked or stored in the structure. C. Coverage C - Personal Property We cover personal property owned or used by you while located at the residence premises. We do not cover: a. articles separately described and specifically insured in any other insurance. b. glassware, china, goldware, silverware, porcelain or ceramic item, art work or other decorative item; animals, birds, fish, landscaping, trees, shrubs, lawns or plants, motor vehicles or any other motorized land conveyances including their equipment, aircraft, aircraft parts, watercraft, watercraft equipment, outboard motors, trailers, property of boarders or tenants not related to any insured; business property located on or away from your premises, credit cards, fund transfer cards, money, bank notes, bullion, gold, silver, platinum, coins and medals, rare coins, securities, accounts, deeds, evidence of debt, letters of credit, notes other than bank notes, manuscripts, tickets, passports, stamps, grave markers, software, data or records stored on media designed for use with a computer. D. Coverage D Loss of Use 1. Additional Living Expenses a. If an earthquake makes the part of the residence premises where you reside not fit to live in, we cover any necessary increase in living expenses you incur so that your household can maintain its normal standard of living. b. If a civil authority prohibits you from use of the residence premises as a result of direct damage to neighboring premises by an earthquake we cover the Additional Living Expense loss as provided under "a". Payment shall be for the shortest, most reasonable time required to make your dwelling ready for occupancy or, if you permanently relocate, the shortest, most reasonable time required to settle elsewhere but not to exceed: a. the Additional Living Expense limit of liability stated on the Declarations, or b. the direct financial loss you incur under Additional Living Expense; whichever is less. This coverage is not limited by expiration of this policy. We do not cover loss or expense due to cancellation of a lease or agreement. 2. Fair Rental Value If a loss covered under Property Coverages makes that part of the residence premises rented to others or held for rental by you not fit to live in, we cover the fair rental value of such premises less any expenses that do not continue while it is not fit to live in. Payment will be for the shortest time required to repair or replace such premises. E. Additional Coverages Land Stabilization. We will pay up to an additional $5,000, for the cost required to replace, rebuild, stabilize or otherwise restore the land necessary to support the covered dwelling sustaining a covered loss. The deductible must be met before Land Stabilization coverage is available. Loss under this coverage will not be included in meeting your deductible. F. Other Coverages 1. Building Ordinance Coverage. We will pay up to $10,000 for the purpose of Building Code Costs required to bring the covered dwelling up to current local residential dwelling building code. The building code costs must be required by local entity as part of the approval of the reconstruction permit process following a covered loss. This is not additional coverage, it is included in the Coverage A (dwelling) limit. DEQ AXS GUS COMP (11/06) Page 2 of 7

3 2. Debris Removal. We will pay up to 5% of the Dwelling value or a maximum of $50,000, whichever the lesser amount, for the removal of debris from a property loss covered by this policy. Debris removal expense is included in the limit of liability applying to the damaged property. 3. Reasonable Repairs. We will pay the reasonable cost incurred by you for necessary repairs made solely to protect the property covered by this policy from further damage if there is coverage under this policy for the peril causing the loss. This cost is included in the limit of liability that applies to the property being repaired. PERILS INSURED AGAINST We insure for direct loss to the property caused by: 1. Earthquake One or more earthquake shocks occurring within a seventy-two hour period will be considered a single earthquake. Special Exclusion We do not cover loss: (1) Caused directly or indirectly by flood of any nature or tidal wave, even if attributable to or resulting from or made worse by earthquake. (2) Caused directly or indirectly by landslide, mine subsidence, mudslide or mudflow, earth sinking, rising, settling or shifting and volcanic eruption. (3) To exterior masonry veneer other than stucco on wood frame walls caused by earthquake or volcanic eruption. The value of such veneer will not be included in the value of Covered Property or the amount of loss when applying the Deductible applicable to this form. This limitation does not apply if: a. The premises description in the Declarations specifically states Including Masonry Veneer"; or b. Less than 10% of the total outside wall area is faced with masonry veneer (excluding stucco). GENERAL EXCLUSIONS We do not cover loss resulting directly or indirectly by any of the following. Such loss or damage is excluded regardless of any other cause or event that contributes concurrently or in any sequence to the loss: 1. Fire; lightning; windstorm; explosion; strike; riot; civil commotion; aircraft, spacecraft, selfpropelled missiles, and objects that fall from these items; vehicles; vandalism or sprinkler leakage. 2. dishonest or illegal acts, whether committed by you or others, including but not limited to burglary, theft, robbery, and conversion of property. 3. loss by mysterious disappearance. 4. the following: a. corrosion or rust. b. rot or mold. c. leakage, evaporation, shrinkage or loss of weight. d. the covered property being soured, scented, discolored or changed in flavor. e. smog, fumes or vapors. 5. cleanup or demolition of any structure or personal property located on the residence premises contaminated by smoke, fumes or residue caused by, or resulting from any illegal use of the residence premises as a laboratory for the production of controlled or illegal chemicals or narcotics. In addition, the company has no obligation to defend or indemnify the insured as a result of any claims or incidents relating to this exclusion. 6. cleanup, demolition, repair, replacement or any form of rehabilitation of any structure or personal property located on the residence premises contaminated by lead, lead based paints, or any other lead containing material. Contamination as used in this context includes deliberate application of any product containing lead. Cleanup and abatement expenses related to the removal of contaminated materials are also excluded. In addition, the company has no obligation to defend or indemnify the insured as a result of any claims or incidents relating to this exclusion. 7. water damage, meaning a. flood, surface water, waves, tidal water, overflow of a body of water or spray from any of these, whether or not driven by wind; b. water which backs up through sewers or drains; or c. 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. 8. power interruption, meaning the interruption of power or other utility service if the interruption takes place away from the Described Location. 9. war, including undeclared war, civil war, insurrection, rebellion, revolution, warlike act by a military force or military personnel, destruction or seizure or use for a military purpose, and including any consequence of any of these. Discharge of a nuclear weapon shall be deemed a warlike act even if accidental. 10. loss or damage from any peril to lawns, plants, shrubs or trees outside of buildings. 11. loss or damage to land, no matter where it is located, and regardless of the origin or cause of the damage, except as provided under Additional DEQ AXS GUS COMP (11/06) Page 3 of 7

4 Coverages, Land Stabilization. 12. loss or damage from any peril not specifically listed as a Peril Insured Against CONDITIONS 1. Policy Period. This policy applies only to loss which occurs during the policy period. 2. Insurable Interest and Limit of Liability. Even if more than one person has an insurable interest in the property covered, we shall not be liable: a. for an amount greater than the interest of a person insured under this policy; or b. for more than the limit of liability that applies. 3. Concealment or Fraud. We do not provide coverage if you have intentionally concealed or misrepresented any material fact or circumstance relating to this insurance. 4. Your Duties After Loss. In case of a loss to which this insurance may apply, you shall see that the following duties are performed: a. give immediate notice to us or your agent; b. protect the property from further damage, make reasonable and necessary repairs required to protect the property, and keep an accurate record of repair expenditures; c. prepare an inventory of damaged personal property showing in detail, the quantity, description, actual cash value and amount of loss. Attach to the inventory all bills, receipts and related documents that substantiate the figures in the inventory; d. as often as we may reasonably require: I. exhibit the damaged property II. provide us with records and documents we request and permit us to make III. copies; and submit to examination under oath and subscribe to the same. e. submit to us, within 60 days after we request, your signed sworn proof of loss which sets forth, to the best of your knowledge and belief: I. the time and cause of loss; II. interest of you and all others in the property involved and all encumbrances on the property; III. other insurance which may cover the loss; IV. changes in title or occupancy of the property during the term of the policy; V. specifications of any damaged building and detailed estimates for repair of the damage; VI. an inventory of damaged personal property described in 4c; 5. Loss Settlement. Covered property losses are settled at actual cash value unless replacement cost is shown on the declaration page under coverage description. At the time of loss, losses are settled not to exceed the smallest of the following amounts: a. The amount necessary to repair or replace the damaged property; or b. The Limit of Liability under Property Coverages of this policy. 6. Loss to a Pair or Set. In case of a loss to a pair or set we may elect to: a. repair or replace any part to restore the pair or set to its value before the loss; or b. pay the difference between actual cash value of the property before and after the loss. 7. Glass Replacement. Covered loss to glass shall be settled on the basis of replacement with safety glazing materials when required by ordinance or law. 8. Appraisal. If you and we fail to agree on the amount of loss, either can demand that the amount of the loss be set by appraisal. If either makes a written demand for appraisal, each shall select a competent, independent appraiser and notify the other of the appraiser's identity within 20 days of receipt of the written demand. The two appraisers shall then select a competent, impartial umpire. If the two appraisers are unable to agree upon an umpire within 15 days, you or we can ask a judge of a court of record in the state of the Described Location to select an umpire. The appraisers shall then set the amount of the loss. If the appraisers submit a written report of agreement to us, the amount agreed upon shall be the amount of the loss. If the appraisers fail to agree within a reasonable time, they shall submit their differences to the umpire. Written agreement signed by any two of these three shall set the amount of the loss. Each appraiser shall be paid by the party selecting that appraiser. Other expenses of the appraisal and the compensation of the umpire shall be paid equally by you and us. 9. Other Insurance. If a loss covered by this policy is also covered by other insurance, we 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. 10. Subrogation. You may waive in writing before a loss all rights of recovery against any person. If not waived, we may require an assignment of rights of recovery for a loss to the extent that payment is made by us. If an assignment is sought, the person insured shall sign and deliver all related papers and cooperate with us in any reasonable manner. Page 4 of 7

5 11. Suit Against Us. No action shall be brought unless there has been compliance with the policy provisions and the action is started within one year after the loss. 12. Our Option. If we give you written notice within 30 days after we receive your signed, sworn statement of loss, we may repair or replace any part of the property damaged with equivalent property. 13. Loss Payment. We will adjust all losses with you. We will pay you unless some other person is named in the policy or is legally entitled to receive payment. Loss will be payable 30 days after we receive your proof of loss and: a. reach agreement with you; or b. there is an entry of a final judgment; or c. there is a filing of an appraisal award with us. 14. Abandonment of Property. We need not accept any property abandoned by you. 15. Mortgagee Clause. a. If a mortgagee is named in this policy, any loss payable under this policy will be paid to the mortgagee and you, as interests appear. If more than one mortgagee is named, the order of payment will be the same as the order of precedence of the mortgages. b. If we deny your claim, that denial will not apply to a valid claim of the mortgagee, if the mortgagee: I. Notifies us of any change in ownership, occupancy or substantial change in risk of which the mortgagee is aware; II. Pays any premium due under this policy on demand if you have neglected to pay III. the premium; and Submits a signed, sworn statement of loss within 60 days after receiving notice from us of your failure to do so. Paragraphs 7. Appraisal, 10. Suit Against Us and 12. Loss Payment under the Conditions section also apply to the mortgagee. c. If we decide to cancel or not to renew this policy, the mortgagee will be notified at least 10 days before the date cancellation or nonrenewal takes effect. d. If we pay the mortgagee for any loss and deny payment to you: I. We are subrogated to all the rights of the mortgagee granted under the mortgage on the property; or II. At our option, we may pay to the mortgagee the whole principal on the mortgage plus any accrued interest. In this event, we will receive a full assignment and transfer of the mortgage and all securities held as collateral to the mortgage debt. e. Subrogation will not impair the right of the mortgagee to recover the full amount of the mortgagee's claim. 16. No Benefit to Bailee. We will not recognize any assignment or grant any coverage for the benefit of any person or organization holding, storing or transporting property for a fee regardless of any other provision of this policy. 17. Cancellation. a. You may cancel this policy at any time by returning it to us or by notifying us in writing of the date cancellation is to take effect. b. We may cancel this policy by mailing to you or your representative, or any lienholder shown in the policy, at the last address known by us or at the last address shown in our records, written notice stating when not less than thirty (30) days thereafter such cancellation shall be effective; provided that in the event of nonpayment of premium, such notice shall state when not less than ten (10) days thereafter such cancellation shall be effective. c. When this policy has been in effect for sixty (60) days or more, or at any time if it is a renewal with us, we may cancel if there has been a material misrepresentation of fact which if known to us would have caused us to not issue the policy or if the risk has changed substantially since the policy was issued. This can be done by notifying you at least thirty (30) days before the date cancellation takes effect. d. When this policy is written for a period longer than one year, we may cancel for any reason at anniversary by notifying you at least thirty (30) days before the date cancellation takes effect. e. When this policy is cancelled, the Policy Fee shall be fully earned and the premium for the period from the date of cancellation to the expiration date will be refunded, subject to a Minimum Earned Premium if one is indicated on the Declarations of this policy. When you request cancellation, the return premium will be based on our rules for such cancellation, and will be less than a full pro rata refund. When we cancel, the return premium will be pro rata. f. If the return premium is not refunded with the notice of cancellation or when this policy is returned to us for cancellation, we will refund it as soon as possible, but no later than: I. 45 days after we send a notice of cancellation to you; or II. 30 days after we receive the policy or a Page 5 of 7

6 notice of cancellation from you. g. If the policy is cancelled by us, any mortgagee or other person with a financial interest in the property, who is named in the Declarations or in any endorsement attached to this policy, will be notified in writing at least ten (10) days before the date cancellation takes effect. The cancellation notice may be delivered or mailed; proof of mailing will be sufficient proof of notice. 18. Non-Renewal. We may elect not to renew this policy. We may do so by delivery to you or mailing to you at your mailing address shown in the Declarations, written notice at least thirty (30) days before the expiration date of the policy. Proof of mailing shall be sufficient proof of notice. 19. Liberalization Clause. If we adopt any revision which would broaden the coverage under this policy without additional premium within 60 days prior to or during the policy period, the broadened coverage will immediately apply to this policy. 20. Waiver or Change of Policy Provisions. A waiver or change of any provision of this policy must be in writing by us to be valid. Our request for an appraisal or examination shall not waive any of our rights. 21. Assignment. Assignment of this policy shall not be valid unless we give our written consent. 22. Death. If you die, we insure: a. your legal representatives, but only with respect to the property covered under the policy at the time of death; b. with respect to your property, the person having proper temporary custody of the property until appointment and qualification of a legal representative. 21. Nuclear Hazard Clause. a. Nuclear Hazard means any nuclear reaction, radiation, or radioactive contamination, all whether controlled or uncontrolled or however caused, or any consequence of any of these. b. Loss caused by the nuclear hazard shall not be considered loss caused by fire, explosion, or smoke, whether these perils are specifically named in or otherwise included within the Perils Insured Against. c. This policy does not apply to loss caused directly or indirectly by nuclear hazard. DEDUCTIBLE Unless otherwise noted in this policy, the following deductible provision applies: Subject to the policy limits that apply, we will only pay that part of the total of all loss payable that exceeds the deductible amount. The deductible amount shall be calculated as a percentage of the Total Insured Value listed in the Declarations. The applicable percentage is shown in the Declarations. Example: When: - The Total Insured Value under a policy is $100,000 - The Earthquake Deductible is 5% - The amount of loss is $20,000 Step (a): $100,000 x 5% = $5,000 Step (b): $20,000 - $5,000 = $15,000 The most we will pay is $15,000. The remaining $5,000 is not covered as this is the calculated deductible amount COINSURANCE If a Coinsurance percentage is shown in the Declarations, the following condition applies. We will not pay the full amount of any loss if the value of Covered Property at the time of loss times the Coinsurance percentage shown for it in the Declarations is greater than the Limit of Insurance for the property. Instead, we will determine the most we will pay using the following steps: (1) Multiply the value of Covered Property at the time of loss by the Coinsurance percentage; (2) Divide the Limit of Insurance of the property by the figure determined in step (1); (3) Multiply the total amount of loss, before the application of any deductible, by the figure determined in step (2); and (4) Subtract the deductible from the figure determined in step (3). We will pay the amount determined in step (4) or the limit of insurance whichever is less. For the remainder, you will either have to rely on other insurance or absorb the loss yourself. Example (Underinsurance): When: The value of the property is $250,000 The Coinsurance percentage for it is 80% The Limit of Insurance for it is $100,000 The Deductible is $250 The amount of loss is $40,000 Step (1): $250,000 x 80% = $200,000 (the minimum amount of insurance to meet your Coinsurance requirements) Step (2): $100,000 $200,000 =.50 Step (3): $ 40,000 x.50 = $20,000 Step (4): $ 20,000 $250 = $19,750 Page 6 of 7

7 We will pay no more than $19,750. The remaining $20,250 is not covered. Page 7 of 7