IDAHO COMMERCIAL FIRE & ALLIED LINES RULES PROPOSED CHANGES

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Frank Greene
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1 ISRB CIRCULAR IDAHO COMMERCIAL FIRE & ALLIED LINES RULES PROPOSED CHANGES Rules ADVANCE PLANNING BACKGROUND CHANGES January 21, CF-06 This is information is intended exclusively for Idaho Surveying and Rating Bureau, Inc. affiliated companies. Bureau staff has received the Commercial Fire & Allied Lines rules addition introducing Off -Premises Interruption of Business Vehicles and Mobile Equipment. This review will introduce Off -Premises Interruption of Business Vehicles and Mobile Equipment as shown in the companion rules and forms filings. Based on staff s evaluation of this review, the Bureau plans to implement the following changes to Commercial Fire and Allied Lines in Idaho and would like your comments regarding this filing prior to February 21, CF-2013-RBIRU We are introducing rule 54.F. to provide instruction on new endorsement CP Off-premises Interruption Of Business Vehicles And Mobile Equipment. Noteworthy points in this rule include: CP is an optional endorsement which extends the business interruption coverage applicable to the described premises to designated business activities that are dependent on scheduled vehicles and mobile equipment. Endorsement CP can be used with any of the three ISO Commercial Property (CP) business interruption coverage forms: CP Business Income (And Extra Expense) Coverage Form, CP Business Income (Without Extra Expense) Coverage Form and CP Extra Expense Coverage Form. However, endorsement CP is designed to be attached only if the Causes of Loss Special Form CP applies to the business interruption policy. The coverage provided under CP is subject to the Off-premises Limit(s) of Insurance entered in the Schedule of this endorsement. Multiple items of scheduled property may be written under a single Limit; or separate Limits may be written for individual items of scheduled property. The Off-premises Limit(s) function as a sub-limit of the amount of insurance applicable to the described premises. Guidance is provided to assist in determining the estimated business interruption exposure arising from operations dependent on scheduled property. (Although the policy's Coinsurance clause does not apply to the coverage provided under CP 15 06, there are instructions to apply a surcharge, in the form of a rating factor, under certain circumstances if the Off-premises Limit is less than a specified proportion of the estimated exposure.) Loss costs for CP are provided in the companion Loss Costs filing. The loss costs are differentiated based on the applicable business interruption coverage form and the covered causes of loss (Collision, if selected, and Other Than Collision). The loss costs are modified by rating factors which correspond to coverage options available in endorsement CP and endorsements (if any) that modify the covered perils. The rating factors recognize: Additional and excluded perils for consistency with the underlying policy (addition of earthquake and/or flood coverage; use of wind/hail exclusion); Duration of Extended Business Income Coverage (fewer or more than 60 days); daho Surveying & Rating Bureau, Inc S Cobalt Point Way Tel: Meridian, Idaho Fax: info@isrb.com Page 1 of 2

2 Length of the waiting period for Business Income Coverage (72 hours, 24 hours or no waiting period); and Insurance-to-exposure level in the situation where a single Limit applies to multiple items of scheduled property. The final rate is multiplied by the Off-premises Limit of Insurance in hundreds to determine the premium for endorsement CP If more than one Off-premises Limit of Insurance is written, a premium is determined separately for each Limit. If Collision is a covered cause of loss, the premium for that peril is determined separately from the Other Than Collision premium for each Limit. Examples illustrate how the coverage options for CP might be selected and rated for two hypothetical insureds. EFFECTIVE DATE PERSON TO CONTACT The effective date for these changes will be announced after the comment period and when all changes have been coordinated with the Insurance Services Office, Inc. to establish a publication time schedule. The comment period will end February 21, Joseph C. Harbacheck x25 jharbacheck@isrb.com daho Surveying & Rating Bureau, Inc S Cobalt Point Way Tel: Meridian, Idaho Fax: info@isrb.com Page 2 of 2

3 RULES FILING CF-2013-RBIRU Off-premises Interruption Of Business - Vehicles And Mobile Equipment Rule Introduced About This Filing New Rule This filing introduces a rule to complement a new coverage option being introduced in the companion Form filing. Rule 54.F. Off-premises Interruption Of Business - Vehicles And Mobile Equipment is being introduced under Rule 54., Common Time Element Options. We have used a format of striking-through deletions, underlining additions and inserting a revision bar in the left margin to indicate changes. In jurisdictions in which the most current ISO Commercial Property multistate rules program is in effect, these changes will be added to multistate Rule 54. Otherwise, these changes will be added as a state exception to Rule 54. Related Filing(s) Background CF-2013-OBIFR (Form) CF-2013-RBILC (Loss Costs) In companion Form filing CF-2013-OBIFR, we are introducing Off-premises Interruption Of Business Vehicles And Mobile Equipment endorsement CP 15 06, which addresses coverage with respect to the insured's business interruption resulting from loss or damage to scheduled vehicles and mobile equipment while away from the described premises.

4 RULES FILING CF-2013-RBIRU Page 2 Explanation of Changes We are introducing rule 54.F. to provide instruction on new endorsement CP Off-premises Interruption Of Business Vehicles And Mobile Equipment. Noteworthy points in this rule include: CP is an optional endorsement which extends the business interruption coverage applicable to the described premises to designated business activities that are dependent on scheduled vehicles and mobile equipment. Endorsement CP can be used with any of the three ISO Commercial Property (CP) business interruption coverage forms: CP Business Income (And Extra Expense) Coverage Form, CP Business Income (Without Extra Expense) Coverage Form and CP Extra Expense Coverage Form. However, endorsement CP is designed to be attached only if the Causes of Loss Special Form CP applies to the business interruption policy. The coverage provided under CP is subject to the Off-premises Limit(s) of Insurance entered in the Schedule of this endorsement. Multiple items of scheduled property may be written under a single Limit; or separate Limits may be written for individual items of scheduled property. The Offpremises Limit(s) function as a sub-limit of the amount of insurance applicable to the described premises. Guidance is provided to assist in determining the estimated business interruption exposure arising from operations dependent on scheduled property. (Although the policy's Coinsurance clause does not apply to the coverage provided under CP 15 06, there are instructions to apply a surcharge, in the form of a rating factor, under certain circumstances if the Off-premises Limit is less than a specified proportion of the estimated exposure.) Loss costs for CP are provided in the companion Loss Costs filing. The loss costs are differentiated based on the applicable business interruption coverage form and the covered causes of loss (Collision, if selected, and Other Than Collision). The loss costs are modified by rating factors which correspond to coverage options available in endorsement CP and endorsements (if any) that modify the covered perils. The rating factors recognize: Additional and excluded perils for consistency with the underlying policy (addition of earthquake and/or flood coverage; use of wind/hail exclusion);

5 RULES FILING CF-2013-RBIRU Page 3 Impact Duration of Extended Business Income Coverage (fewer or more than 60 days); Length of the waiting period for Business Income Coverage (72 hours, 24 hours or no waiting period); and Insurance-to-exposure level in the situation where a single Limit applies to multiple items of scheduled property. The final rate is multiplied by the Off-premises Limit of Insurance in hundreds to determine the premium for endorsement CP If more than one Off-premises Limit of Insurance is written, a premium is determined separately for each Limit. If Collision is a covered cause of loss, the premium for that peril is determined separately from the Other Than Collision premium for each Limit. Examples illustrate how the coverage options for CP might be selected and rated for two hypothetical insureds. Refer to the Actuarial Support section of companion Loss Costs filing CF RBILC for information on development of the rating factors contained in this filing. This is a new coverage option, which broadens coverage under a policy to which it is endorsed. Copyright Explanation The material distributed by Insurance Services Office, Inc. is copyrighted. All rights reserved. Possession of these pages does not confer the right to print, reprint, publish, copy, sell, file or use same in any manner without the written permission of the copyright owner. Important Note Insurance Services Office, Inc. (ISO) makes available advisory services to property/casualty insurers. ISO has no adherence requirements. ISO rules and explanatory materials are intended solely for the information and use of ISO's participating insurers and their representatives, and insurance regulators. Neither ISO's general explanations of rules intent nor opinions expressed by members of ISO's staff necessarily reflect every insurer's view or control any insurer's application of manual rules.

SERFF Tracking #: WSRB State Tracking #: Company Tracking #: DP-2015-OTEFO

SERFF Tracking #: WSRB State Tracking #: Company Tracking #: DP-2015-OTEFO Publication Date: Thursday, February 26, 2015 DWELLING PROGRAM TRIA FORMS AND RULES CHANGES Circular DP-2015-02 The purpose of these filings is to introduce changes necessary to bring WSRB's forms and