American Integrity Insurance Company of Florida

Transcription

1 American Integrity Insurance Company of Florida Voluntary Dwelling - Basic Program- FLORIDA Voluntary Dwelling DP- 1 Basic Form 10/01/2014 American Integrity Insurance Group

2 Table of Contents UNDERWRITING GUIDELINES BINDING AUTHORITY...5 HURRICANE - TROPICAL STORM SUSPENSION...6 ELIGIBILITY - UNDERWRITING...6 GENERAL...6 INELIGIBLE RISKS...7 General Characteristics...7 Property Features...7 Property Condition...8 Liability Exposure(s)...8 Property Value(s) or more than one home on the property...9 Applicant characteristics and Loss History...9 GENERAL RULES...10 APPLICANT...10 AGE OF HOME...10 CANCELLATION OR REDUCTIONS IN LIMITS OF LIABILITY OR COVERAGE...10 LAPSE IN COVERAGE/NO PRIOR INSURANCE...10 MULTIPLE COMPANY INSURANCE...10 OCCUPANCY/USE...10 POLICY TERM...11 PRIOR CANCELLATIONS/NON-RENEWALS...11 PROPERTIES DEEDED IN AN LLC, TRUST OR CORPORATION...11 RENEWAL PLAN...11 ROOF (NEW AND RENEWAL BUSINESS)...12 SECONDARY/SEASONAL RESIDENCES...12 SWIMMING POOLS (NEW AND RENEWAL BUSINESS)...13 TOWN OR ROW HOUSE...13 TRAMPOLINES (NEW AND RENEWAL BUSINESS)...13 TRANSFER OR ASSIGNMENT...13 WAIVER OF PREMIUM...14 WHOLE DOLLAR PREMIUM RULE...14 INSURANCE TO VALUE...14 BINDING AUTHORITY LIMITS/PROGRAM DESCRIPTION...14 Vol Dwelling Basic October 2014 Page 2

3 CONSTRUCTION DEFINITIONS...15 COVERED PERILS...15 MANDATORY ENDORSEMENTS...15 AIIC DP1 09 SP Special Provisions - Florida...16 AIIC DP1 09 SPL Special Provisions Liability...16 AIIC DP1 09 HD - Calendar Year Hurricane Deductible with Supplemental Reporting Requirement- Florida 16 AIIC DP1 DO Deductible Options Notice...16 DL Personal Liability...16 DL Premises Liability...16 DL No Coverage for Home Day Care Business...16 AIIC DP1 09 TL - Trampoline Liability Exclusion...16 DL Limited Fungi, Wet or Dry Rot, or Bacteria Coverage...16 AIIC DP Windstorm Exterior Paint or Waterproofing Exclusion- Seacoast- Florida...17 MANUAL PREMIUM REVISION...17 MINIMUM AND MAXIMUM VALUE...17 MINIMUM PREMIUM...17 MULTIPLE LOCATIONS...18 PROPERTIES LOCATED ON MORE THAN 5 ACRES IN A PC 9 OR A PC 10 PROPERTY...18 PROPERTIES WITH FARM ANIMALS OR HORSES (NOT ON A FARM)...18 PROTECTION CLASS...18 COVERAGE OPTIONS...19 ADDITIONAL INSURED...19 ADDITIONAL INTERESTS...19 BUSINESS PURSUITS - NO COVERAGE...19 CONDOMINIUM UNIT OWNERS COVERAGE...19 COVERAGE B - OTHER STRUCTURES...20 COVERAGE C PERSONAL PROPERTY...20 COVERAGE FAIR RENTAL VALUE...20 DEDUCTIBLES...20 INCREASED LIABILITY COVERAGE LIMITS...23 LIMITED FUNGI, MOLD, WET OR DRY ROT, OR BACTERIA COVERAGE ENDORSEMENT...23 LOSS ASSESSMENT COVERAGE...23 OTHER INSURED LOCATION - NO COVERAGE...23 SINKHOLE LOSS COVERAGE- FLORIDA...24 THEFT COVERAGE - NO COVERAGE...24 WIND OR HAIL- SCREEN ENCLOSURES AND CARPORTS (NOT AVAILABLE FOR POLICIES EXCLUDING WIND COVERAGE)...24 WINDSTORM OR HAIL EXCLUSION- FLORIDA...25 PREMIUM CALCULATIONS...26 Vol Dwelling Basic October 2014 Page 3

4 AGE OF DWELLING...27 BUILDING CODE EFFECTIVENESS GRADING...27 Community Grading...27 Individual Grading...28 Ungraded and Nonparticipating Risks...28 TOWN OR ROW HOUSE...27 DISCOUNTS/SURCHARGES...29 HARDIPLANK SIDING DISCOUNT...29 LAPSE IN COVERAGE/ NO PRIOR INSURANCE SURCHARGE...29 PROTECTIVE DEVICES DISCOUNT...29 PREMIUM FACTORS - HURRICANE BASE RATE...30 Windstorm Loss Mitigation Features...31 A. Eligibility...31 B. Mitigation Credit Tables...31 C. Verification...31 D. Definitions of Terms...31 ADDITIONAL FEES...43 EMERGENCY MANAGEMENT PREPAREDNESS AND ASSISTANCE TRUST FUND SURCHARGE (EMPATF)...43 MANAGING GENERAL AGENCY (MGA) FEE...43 PAYMENT PLAN OPTIONS...44 GENERAL RULES...44 PAYMENT PLANS...44 FORMS...46 FIRE KEY PREMIUMS...47 EXTENDED COVERAGE KEY PREMIUMS...48 WIND EXCLUSION CREDITS AND SINKHOLE LOSS COVERAGE...51 KEY FACTORS...54 HURRICANE BASE PREMIUM PERCENTAGE...55 WINDSTORM DISCOUNT FACTORS...58 TERRITORY DEFINITIONS BY ZIP CODE...61 RATE CALCULATION WORKSHEET...69 Vol Dwelling Basic October 2014 Page 4

5 BINDING AUTHORITY Agents have the authority to bind coverage on any risk that is not identified as "ineligible" in the Ineligible Risks section of this underwriting guide. Agent's authority is for the limits stated and outlined in the various sections of this guide. Any exceptions must be referred to the American Integrity Insurance Company (herein after referenced as the Company or AIIC) for approval prior to binding. A dwelling replacement cost estimator must be completed. The amount of coverage carried on the dwelling shall be one hundred percent (100%) of the Actual Cash Value at inception or renewal. All new business submissions must use forms approved by the Company and must be signed by the insured. Applications must be fully complete and payment must be submitted to the Company within 5 business days of binding. Original signed applications and all other required documentation must be maintained in the agent's files. The only exception is the Wind Mitigation Inspection (for homes built 2001 or prior) which must be submitted to the Company if credits are provided. The Company will perform periodic audits of the agent's files to ensure compliance with all rules and guidelines. Note: Section of the Florida Statutes provides that any misrepresentation of material fact, omission or incorrect statement on an application for coverage may prevent recovery under the policy. All risks are subject to an inspection to confirm values and/or insurability. The applicant must provide the name and phone number of the person responsible for securing access to both the interior and exterior of the dwelling, including arranging for permission to enter a gated/guarded community. Any requests to increase/decrease coverage may need to be submitted to underwriting. Submissions may require information other than that shown on the application. Agents should obtain any information that helps support acceptance of the request being submitted, especially when the information calls for more explanation or when this manual indicates that additional information is required. Such cases include but are not limited to: Documentation of updates to roofing, heating, wiring, plumbing, etc. Determination of Actual Cash Value Evidence of National Flood Insurance Program (NFIP) coverage, if required Evidence of Wind Mitigation features, hip roof and/or Opening Protection For renewal business, the Company has the option to perform an annual inspection to verify correct insurance to value, confirm rating variables such as construction type, and determine if there have been changes in exposure or increased hazards. AIIC will pay the inspection fee on renewal inspections. Our inspections may include but are not limited to an interior, exterior, sinkhole or any combination of these inspections. Risks that do not pass a sinkhole inspection will be non-renewed. The insured may request a comparable policy with no sinkhole coverage (the policy will continue to include Catastrophic Ground Cover Collapse Coverage). Refer to the Sinkhole Loss Coverage section of the manual for complete details. Vol Dwelling Basic October 2014 Page 5

6 HURRICANE - TROPICAL STORM SUSPENSION Agents binding authority automatically terminates for new business and coverage increase/decrease when a "Hurricane or Tropical Storm Warning" has been issued by the National Oceanic and Atmospheric Administration or the National Weather Bureau based on the following rules: Hurricanes: Binding is restricted when the Hurricane is within the following boundaries: 72 W longitude, 15 N latitude, 90 W longitude, 32 N latitude. Tropical Storms: Binding is only restricted in areas under a tropical storm warning or watch. The rest of the state remains open. No new coverage shall be written within the first seventy-two (72) hours after a tropical storm or hurricane has left the aforementioned defined area unless the Company has removed the binding restrictions, the agent has inspected the property to verify that no loss has taken place, obtained a signed no loss statement from the applicant and noted on the application that said inspection was made. Renewals will only be issued on an "as expiring" basis for coverage and perils; limits will only be increased to keep pace with established inflation factors. ELIGIBILITY UNDERWRITING (NEW BUSINESS) The risk must meet all qualifications and rules before it can be bound. If there is a question regarding the qualifications, please discuss with your underwriter prior to submission. GENERAL Coverage may be issued on a dwelling containing not more than four units; o a town or row house structure; o cooperative or condominium unit The peril of windstorm or hail may be excluded if property is eligible for such coverage from Citizens Property Insurance Company (CPIC) or if the insured signs the AIIC DP XW form, indicating the Request to Exclude Windstorm and Hail Coverage. Homes located in a Special Flood Hazard Area (any combination of Zone A or V) must be covered by a Federal Flood insurance policy with matching Coverage A limit (or maximum limit available). Home must be protected with smoke detectors in close proximity of kitchen and sleeping areas. Porches or decks more than 2 feet off the ground or with 3 or more steps leading to them must have properly installed handrails or safety railings. Dwellings with an open foundation. The Company reserves the right to request color photos of any risk. Tenant occupied dwellings must be managed by a property management company if the owner lives more than 100 miles away from the property. Vol Dwelling Basic October 2014 Page 6

7 INELIGIBLE RISKS DO NOT SUBMIT properties where the following exists: GENERAL CHARACTERISTICS Business Exposure- Properties where business is conducted. Two salient elements to help identify a business include: (1) a profit motive and (2) continuity of the activity. This includes but is not limited to: all manufacturing, retail sales when customer traffic is common, bed & breakfast operations, nursing homes, adult care facilities, produce stands, u-pick-it operations, animal kennels, repair work, hair salons and home day care (3 or more children). Farms and Ranches Properties (dwellings) which are part of a "commercial working farm," working ranch, orchard or grove. "Commercial working farms" are defined as properties with any livestock (such as cows, horses, hogs, goats, etc.), properties on which row crops are grown (other than a domestic garden), or properties with income producing farming/ranching operations. Condemned Properties Properties which have been condemned due to condition, properties located in a condemned area or properties in an area scheduled to be condemned due to urban renewal or highway construction. Inaccessible Properties Properties not readily accessible year round to fire department equipment. Isolated properties including barrier islands not connected to the mainland by a road or where emergency vehicles are unable to access a property due to road in poor condition. A road in poor condition includes but is not limited to: ungraded or unstable dirt, potholes, deep sand or other obstructions preventing emergency access. Isolated properties are defined as those that are not visible from at least two dwellings or in sight of a public road Commercial Properties Mobile/Manufactured Homes, Trailer Home, or House trailer Dwellings located in a Citizens High Risk Area or within 1500 feet of tidal waters. Dwellings Constructed Over Water Do-It-Yourself Construction- Buildings or structures that are homemade or rebuilt, or any dwelling with extensive remodeling without permits or a certificate of occupancy. Non-Habitational Properties- Residential risks used primarily for non-habitational purposes or dwellings that were originally designed or constructed for other than habitational purposes. Fraternity or Sorority Houses Fraternity, Sorority or any similar housing arrangement. Vacant Properties- "Vacant" is defined as a dwelling with no contents or occupants, it is empty. Exceptions may be made for Secondary/Seasonal homes. Risks located in a Protection Class 10 Refer to the Properties located on more than 5 Acres in a PC9 or a PC 10 property of the section of the manual for additional details. Properties subject to brush or forest fire. Premium financing as a payment option Daily rentals. Rental properties rented on a monthly or weekly will be considered by the Company and must be submitted to AIIC for underwriting and binding. PROPERTY FEATURES Dwellings of unconventional construction or materials including but not limited to Log or Vol Dwelling Basic October 2014 Page 7

8 Dome homes, etc. Dwellings in the course of construction Dwellings with asbestos, EIFS (Synthetic Stucco) siding, nonstandard or hazardous building materials (Chinese drywall). Roofing: A roof that is worn, with patched areas, multi-layered or has unrepaired damage Shingle/Composition roofs more than 20 years old; validation of roof condition and life expectancy may be required at new business or prior to renewal. Tile or metal roofs more than 40 years old; validation of roof condition and life expectancy may be required at new business or prior to renewal. Asbestos shingle, tin/aluminum or wood shingle roofs. Plumbing: Dwellings with polybutylene plumbing Heating: Electrical: Dwellings heated in whole or in part by solid fuel heating devices, such as wood burning stoves or fireplace inserts, or heated by a device which is not controlled by a wall-mounted thermostat (e.g. portable space heater, portable gas heater, or any device utilizing an open flame). Properties with any potential hazardous electrical conditions, knob & tube wiring, fuses or Aluminum branch wiring which has not been updated to conform to current local codes Properties equipped with electrical service less than 100 amps PROPERTY CONDITION Property in Disrepair/Existing Damage- Properties in a state of disrepair or properties with existing damage. Dwellings which are not properly maintained, this includes but is not limited to: Dwelling(s) or unattached structure in poor condition, In need of paint or repairs Clutter/debris Un-kept property, etc. LIABILITY EXPOSURE(S) Excessive or Unusual Liability Exposure including but not limited to: A pit bull, pit bull terrier or Staffordshire terrier, wolf, wolf hybrid or any mix of such dogs, owned by the insured or kept on the premises, are ineligible animals Any animal with aggressive tendencies, history of attack or trained as an attack animal owned by the insured or kept on the premises. This includes non-domesticated and/or exotic animals. Vol Dwelling Basic October 2014 Page 8

9 Pools not completely fenced, walled or screened. The fence or wall must be of a material that provides a reasonable barrier to entry (e.g. chain link, wood, steel or aluminum), be at least 4 high, permanently installed, comply with local ordinances, and have a self-locking gate or door. The pool may not have a diving board or slide. Above ground pools must have steps that can be locked in the up position. Trampolines in unfenced yards. The fence or wall must be of a material that provides a reasonable barrier to entry (e.g. chain link, wood, steel or aluminum), be at least 4 high, permanently installed, comply with local ordinances, and have a self-locking gate or door. Attractive nuisances including but not limited to: racing or activity courses, large play grounds, skate board or bicycle ramps. Disabled, unused, or untagged vehicles on the premises Risks where the insured owns recreational vehicle(s) including but not limited to: ATV, Dune Buggy, Go Cart, or Dirt Bike. Risks are acceptable if insured provides proof of separate liability coverage with the same limit as provided on this policy. Evidence must be maintained in Agent s Office and is subject to audit at the request of the Company. Applicants in possession of dangerous firearms including, but not limited to, assault-type and rapid fire weapons, except for game hunting rifles or shotguns. PROPERTY VALUE(S) OR MORE THAN ONE HOME ON THE PROPERTY Coverage Limits Minimum/Maximum- Properties for which Actual Cash Value (Coverage A ) is either below or above the limits shown in the Minimum and Maximum Values section of the Dwelling Property Program Manual. Risks with more than one dwelling on the premises, whether a home or manufactured home, without separate parcel, deed or separate address. A single family residence occupied by more than one family. APPLICANT CHARACTERISTICS AND LOSS HISTORY Risks with any prior or current Sinkhole activity on the premises whether or not it results in a loss to the dwelling. If any prior sinkhole loss, coverage cannot be bound. Properties located in close proximity to known sinkholes will not be issued with Sinkhole Loss Coverage. Refer to the Sinkhole Loss Coverage section of the manual for complete details. Arson or Insurance Fraud At the time of application, applicants convicted of arson in the past 25 years, cancelled for insurance fraud in the past 15 years or material misrepresentation on an application for insurance in the past 7 years. Applicant(s) who have had a bankruptcy, repossession or foreclosure within the past 60 months. Risks that have sustained more than one (1) loss of any type, other than a weather related event, within the last 36 months, cannot be bound. For applicants who have sustained a fire or personal liability loss in the last 60 months, coverage cannot be bound. Refer to underwriting for further review. Vol Dwelling Basic October 2014 Page 9

10 GENERAL RULES The Dwelling Policy Program provides property and liability coverage, using forms and endorsements specified in this manual. The manual contains the rules and classifications governing the writing of the Dwelling Program policy. The rules, rates, forms and endorsements of American Integrity Insurance Company for each coverage shall govern in all cases not specifically provided for in this manual. APPLICANT Must hold title to home with a maximum of two mortgages. Be an owner or landlord of a dwelling, condominium or co-op unit. AGE OF HOME A home of any age is eligible for the Dwelling Property program; the home must be maintained in good condition regardless of age. CANCELLATION OR REDUCTIONS IN LIMITS OF LIABILITY OR COVERAGE Mandatory coverage s may not be cancelled unless the entire policy is cancelled. If insurance is increased or reduced, the additional or return premium shall be computed on a pro-rata basis, subject to the minimum premium rule. The insured may cancel the policy at any time for any reason. We will refund any unearned premium pro rata subject to the waiver of premium rule. Note: Hurricane deductible options may only be amended at renewal of the policy. A policy may not be cancelled and rewritten to circumvent this rule. LAPSE IN COVERAGE/NO PRIOR INSURANCE Risks with a lapse in coverage that exceeds 45 days from the date of the lapsed/cancelled policy or have had no prior insurance are eligible under the Dwelling Property program with a Statement of No Loss. The risk will be subject to a 10% surcharge which will be applied for one (1) year from the date of issuance of the policy. The surcharge does not apply to first time home buyers or renewals. Refer to the Credits/Surcharges section of the manual for the surcharge rules. Force placed insurance is not considered acceptable proof of prior insurance. MULTIPLE COMPANY INSURANCE We will not provide coverage for a dwelling that is also covered by another insurance policy. OCCUPANCY/USE Residence may be: Seasonal owner occupied dwellings (occupied by owner more than 4 and less than 9 months) may be rented to others for periods not less than 1 month. Rental properties must be rented on annual leases with a minimum 1 year term. Rental properties rented on a monthly basis may be considered by the Company and are subject to underwriting approval. Used for private residential purposes only with the exception of certain incidental occupancies and/or up to 2 roomers or boarders are permitted. Properties with home day care exposure of 3 individuals or less are not eligible for this program unless evidence of: 1. A current copy of a Certificate of Insurance from the insurer providing Commercial General Liability coverage at limits equal to or greater than the Personal Liability is Vol Dwelling Basic October 2014 Page 10

11 provided at the time of application to the Company. Coverage cannot be bound and must be referred to underwriting for further review. 2. A current copy of the Florida Department of Children and Families "Family Child Care Home Certificate of License," or a copy of a current Child Care License for the covered premises issued by the county of jurisdiction is provided to the Company prior to issuance or renewal of each policy period. A single family dwelling, duplex, three or four family unit dwelling is eligible. SINGLE BUILDING DEFINITION All buildings or sections of buildings that communicate through unprotected openings shall be considered as a single building. Buildings that are separated by space shall be considered as separate buildings. Buildings or sections of buildings, which are separated by: o A 6-inch reinforced concrete or 8-inch masonry party wall that pierces or rises to the underside of the roof and pierces or extends to the inner side of the exterior wall shall be considered a separate building. Accessibility between buildings with independent walls or through masonry party walls described above shall be protected by at least a Class A Fire Door installed in a masonry wall section. POLICY TERM A policy may be written for a period of 12 months and may be extended for successive policy periods by renewal based upon the forms, premiums and endorsements in effect for the Company at the time of renewal. PRIOR CANCELLATIONS/NON-RENEWALS Risks previously cancelled for non-payment or underwriting reasons other than reduction of hurricane exposure, should be referred to the Company and are subject to underwriting approval. If the applicant has been cancelled for non-payment by AIIC, the policy may not be reinstated or rewritten without underwriting approval. If approved, the insured may be asked to provide a Statement of No Loss and a partial or full payment of the premium. PROPERTIES DEEDED IN AN LLC (LIMITED LIABILITY CORPORATION, TRUST OR CORPORATION) A risk may be eligible for the Dwelling Property program if the LLC, Trust or Corporation requires Named Insured status. In these circumstances, liability will be excluded. RENEWAL PLAN If the company elects to offer a renewal, the policy may be renewed by the policyholder by paying the renewal premium prior to the expiration of the current policy. A renewal policy will be issued based on the premiums, forms and endorsements in effect at time of renewal. A new declarations page will be issued. A payment schedule will be mailed with each renewal offer, 60 days prior to the expiration date of the policy term, if the policyholder is the payee. If the account is escrow billed, then a billing statement will be mailed to the policyholder and the mortgage holder. The insured is responsible for ensuring the payment is received prior to the expiration of the policy term. The following risks are not eligible for offers of renewal coverage: Vol Dwelling Basic October 2014 Page 11

12 Properties failing to be maintained in safe and serviceable condition or where repairs have not been completed or when the insured has failed to mitigate risk hazards. Properties no longer meeting minimum or maximum coverage limit requirements or failing to maintain proper insurance to value. Properties not meeting or continuing not to meet eligibility standards applicable to new business. Property claims that are a result of an act of God will not be used as a cause for cancellation or non-renewal unless the insured has failed to take action reasonably necessary to prevent recurrence of damage to the insured property. Risks determined by the Company to be unacceptable for renewal coverage due to: 1. Exposure management considerations, company financial performance, prospective business plans or objectives; 2. The availability and pricing of reinsurance; 3. Factors relating to the risk that would have adversely affected the Company s overall risk assessment if those factors had existed or been known at the time of initial underwriting. The Company, in its discretion, may offer renewal coverage to a risk not otherwise eligible for renewal pursuant to this rule based upon characteristics of the risk or an overall risk assessment, or the Company may determine pursuant to an overall risk assessment that it will not offer a renewal policy to a risk otherwise meeting eligibility criteria. ROOF (NEW AND RENEWAL BUSINESS) A roof must be in good condition and not be worn, with patched areas, multi-layered or have unrepaired damage. A patched roof is evident when several sections of a roof have been repaired/replaced with either the same/similar shingles or have been tarred, etc. Asphalt/Composition shingle roofs must have been replaced within 20 years. Prior to renewal, AIIC may request policyholders with homes over 20 years old to provide validation (color photos and/or other evidence) of roof life expectancy. Homes with roofs less than 3 years life expectancy will be non-renewed the following year. If the entire roof has been replaced the policy will be noted with the date of the roof replacement. Tile or metal roofs more than 40 years old. Prior to renewal, AIIC may request policyholders with roofs over 40 years old to provide validation (color photos and/or other evidence) of roof life expectancy. Homes with roofs less than 3 years life expectancy will be non-renewed the following year. If entire roof has been replaced the policy will be noted with the date of roof replacement. Asbestos shingle, tin/aluminum, or wood shingle roofs are not eligible. A dwelling with a flat roof is eligible. SECONDARY/SEASONAL RESIDENCES A dwelling unoccupied by the owner for more than 3 months annually is considered a Secondary/Seasonal residence. Secondary/Seasonal residences are not eligible for coverage in this program unless the residence is owner occupied for a minimum of 4 months per policy year, AND: residence is located within a limited access community or building (requires security guard or passkey gates), OR residence has a functioning central station fire. Vol Dwelling Basic October 2014 Page 12

13 SWIMMING POOLS (NEW AND RENEWAL BUSINESS) A swimming pool must have a fence or wall of a material that provides a reasonable barrier to entry (e.g. chain link, wood, steel or aluminum), be at least 4 high, permanently installed, comply with local ordinances, and have a self-locking gate or door. Child gates/fences that are not permanently installed with a locking gate are unacceptable. Above ground pools must have steps that can be locked in the up position. No diving boards or slides are permitted. TOWN OR ROW HOUSE (NEW BUSINESS) A policy may be issued for a Town or Row house if it can be determined that it does not exceed the maximum allowed number of units. The following should be considered in the determination: Each unit must be separated by parapet* walls or adequate masonry firewalls. For example, a 2 family dwelling attached to a 1 family dwelling is considered 3 individual family units within a Fire Division if both dwellings are not separated by a firewall. Four attached 2 family dwellings are considered 8 family units within a Fire Division if they are not separated by firewalls (and thus ineligible). Coverage A is available when a dwelling contains 4 or less family units within a Fire Division and/or Coverage C in a dwelling with 1 or more individual family units within a Fire Division. See Single Building Definition *A parapet or firewall that pierces the roof and extends above the roof line at least 15 or higher shall be considered a separate dwelling. To calculate the premium for a 1 to 4 family unit, use Coverage A or C BASE PREMIUM. TRAMPOLINES (NEW AND RENEWAL BUSINESS) A trampoline must have a fence or wall of a material that provides a reasonable barrier to entry (e.g. chain link, wood, steel or aluminum), be at least 4 high, permanently installed, comply with local ordinances, and have a self-locking gate or door. AIIC DP1 09 TL - TRAMPOLINE LIABILITY EXCLUSION is attached to the policy. TRANSFER OR ASSIGNMENT No transfers or assignments are permitted. Each insured and/or property will require submission of a new application and will be subject to the underwriting requirements at the time of application. Vol Dwelling Basic October 2014 Page 13

14 WAIVER OF PREMIUM When a policy is first issued or endorsed after the inception date, additional or return premium of less than $5 is waived. However, the company shall grant any return premium due if requested by the insured. WHOLE DOLLAR PREMIUM RULE When calculating premium, premiums are not rounded during the calculation process. Total premium for Fire, Extended Coverage, Hurricane and each Additional Coverage are rounded to the nearest whole dollar. A premium of fifty cents ($.50) or more shall be rounded to the next higher whole dollar. In the event of cancellation by AIIC, the return premium may be carried to the next higher whole dollar. INSURANCE TO VALUE Risks must be insured for 100 % of Actual Cash Value as determined by an acceptable cost estimator done at the time of application, endorsement or renewal of policy (a cost estimator must be maintained in the Agent s Office and is subject to audit at the request of the Company). The Actual Cash Value can be obtained by adjusting the cost estimator for depreciation. Actual cash value means the amount which would cost to repair or replace covered property with material of like kind and quality, less allowance for physical deterioration and depreciation, including obsolescence. BINDING AUTHORITY LIMITS/PROGRAM DESCRIPTION Coverage A may be issued on a dwelling: Containing not more than four units; Town or row house structure (i.e. a tri/quadplex); Coverage C may be included on personal property in a dwelling insured under Coverage A; A dwelling, cooperative or condominium unit Coverage D may be provided for the loss of fair rental value of a dwelling; Private living quarters eligible under coverage C. The following coverage limits are available for the DP Dwelling Property 1 Basic Form: Coverage Limits Coverage A- Dwelling $100,000* to $500,000 Coverage B- Other Structures 10% up to 70% of Coverage A Coverage C- Personal Property 0 up to 70% of Coverage A Coverage D- Fair Rental Value 10% of Coverage A Coverage L- Personal Liability** $100,000 included; $300,000 also available Coverage M- Medical Payments to Others** $2,000 *Dwellings with actual cash value below $100,000 or above $500,000 must be referred to underwriting with a completed cost estimator and color photos. Minimum coverage for a Dwelling Property form with the Condominium Unit-Owners Coverage is $25,000. **Personal Liability and Medical Payments to Others are optional under the DP1 Basic Form. Vol Dwelling Basic October 2014 Page 14

15 CONSTRUCTION DEFINITIONS Frame - exterior wall of wood or other combustible construction, including wood-iron clad, stucco on wood or plaster on combustible supports, and aluminum or plastic siding over frame. o HardiPlank Siding Frame homes with HardiPlank Siding will be classified as Frame. Masonry Veneer all exterior walls of frame construction veneered with brick, masonry or stone. Masonry Veneer can be rated as masonry only if all of the walls are veneered as indicated. Masonry - exterior walls constructed of masonry materials such as adobe, brick, concrete, gypsum block, hollow concrete block, stone, tile, or similar materials, and floors and roof of combustible construction. Superior Construction Non-Combustible - exterior walls, floors and roof constructed of, and supported by, metal, asbestos, gypsum, or other non-combustible materials. Masonry Non-Combustible - exterior walls constructed of masonry materials (as described above) and floors and roof of metal or other non-combustible materials Fire- Resistive - exterior walls, floors and roof constructed of masonry or other fire resistive materials. Mixed (Masonry/Frame) - a combination of both frame and masonry construction shall be classified as Frame when the exterior walls of frame construction (including gables) exceed 33% of total exterior wall area; otherwise classify as Masonry. COVERED PERILS The following is a general description of the coverage provided by the Dwelling Property 1 Basic Form. The policy form and any attachments should be consulted for exact conditions. Perils Insured Against Fire or Lightning, Internal Explosion Extended Coverage meaning Windstorm or Hail, Explosion, Riot or Civil Commotion, Aircraft, Vehicles, Smoke, Volcanic Eruption Vandalism or Malicious Mischief DP-1 Basic Form Yes Optional Vol Dwelling Basic October 2014 Page 15

16 MANDATORY ENDORSEMENTS The following endorsements are attached to the DP Dwelling Property 1 Basic Form: AIIC DP1 09 SP SPECIAL PROVISIONS - FLORIDA is attached to all policies. Excludes wind/hail damage to all antennas, satellite dishes, awnings, fences, screened enclosures, other structures or personal property located outside of the primary residence. Includes a Special Limits of Liability coverage for Cosmetic and Aesthetic Damage to Floors. Animal Liability Exclusion excludes the liability (coverage E only) for damages caused by any animal owned or kept by any insured. AIIC DP1 09 SPL SPECIAL PROVISIONS LIABILITY is attached to all policies that include Liability Coverage and adds the following exclusions: Exposure to lead or any lead based product, Bodily injury or property damage arising out of an assault and/or battery committed by the named insured. AIIC DP1 09 HD - CALENDAR YEAR HURRICANE DEDUCTIBLE WITH SUPPLEMENTAL REPORTING REQUIREMENT- FLORIDA Applied to all policies with the coverage of Wind or Hail. AIIC DP1 DO DEDUCTIBLE OPTIONS NOTICE Attached to all policies listing the various deductible options available. DL PERSONAL LIABILITY This Endorsement is attached to all owner occupied dwellings that include Liability Coverage. DL PREMISES LIABILITY This Endorsement is attached to all tenant occupied dwellings or dwellings which become vacant during the policy term policies that include Liability Coverage. DL NO COVERAGE FOR HOME DAY CARE BUSINESS This Endorsement is attached to all policies that include Liability Coverage. This Endorsement excludes all Liability coverage for Home Day Care. AIIC DP1 09 TL - TRAMPOLINE LIABILITY EXCLUSION is attached to all policies when Personal Liability is selected and excludes personal liability for the use of a trampoline on the insured premises or supervision by an insured of trampoline usage off the insured premises. DL LIMITED FUNGI, WET OR DRY ROT, OR BACTERIA COVERAGE This endorsement provides an aggregate Section II policy limit of $50,000 when Personal Liability is selected. Vol Dwelling Basic October 2014 Page 16

17 AIIC DP WINDSTORM EXTERIOR PAINT OR WATERPROOFING EXCLUSION- SEACOAST- FLORIDA is attached to all policies that include wind coverage in the following territories: 50, 70, 12*, 14*, 18*, 310, 320, 350, 360, 361, 380, 410, 420. This endorsement excludes damage from windstorm or hail to all paint or waterproofing material applied to the exterior of any dwelling or structure. *indicates any territory beginning with 12, 14, 18 MANUAL PREMIUM REVISION A manual premium revision shall be made in accordance with the following procedures: 1. The effective date of such revision shall be announced. 2. The revision shall apply to any policy or endorsement in the manner outlined in the announcement of the revision. 3. Unless otherwise specified at the time of the announcement of the premium revision, the revision shall not effect: a. in-force policy forms, endorsements or premiums, until the policy is renewed; or b. in the case of the Premium Payment Plan, in-force policy premiums, until the anniversary following the effective date of the revision. MINIMUM AND MAXIMUM VALUE Agent may not bind coverage for less than $100,000 or more than $500,000. submitted to Underwriting for possible binding approval. Risks may be Minimum Coverage A amount is $75,000 Dwelling/$25,000 Condominium Maximum Coverage A amount is $500,000 Dwelling/$200,000 Condominium MINIMUM PREMIUM The minimum annual premium charged for a Dwelling Property is $ The minimum annual premium shall include all chargeable endorsements or coverage s, if written at the inception of the policy. 2. The MGA policy fee and the EMPATF surcharge (Refer to Additional Fees section of the Dwelling Program Manual for details) are not included in the minimum annual premium, and are fully earned upon inception. 3. When necessary to collect at the request of the OIR, FIGA surcharges, Citizens assessment surcharges, and FHCF assessment surcharges are not included in the minimum annual premium. These surcharges are not fully earned, if the policy is amended or cancelled, the additional or return premium, including these surcharges, shall be calculated on a pro rata basis. Vol Dwelling Basic October 2014 Page 17

18 MULTIPLE LOCATIONS This program does not permit coverage for multiple locations on the same policy. PROPERTIES LOCATED ON MORE THAN 5 ACRES IN A PC 9/10 OR A PC 10 PROPERTY A dwelling located in a Protection Class (PC) 9/10 on more than 5 acres or a Protection Class 10 is subject to review to determine eligibility. PC 10 risks must have central station reporting fire alarm or be located in a limited access/gated community. The following information will be required to be submitted to the Company to be able to review the risk: Name of the responding fire department Response time Is the station voluntary or manned 24 hours? Water source? Distance to the hydrant or water source, if there is one. The number and carrying capacity of the pumper and tanker trucks. PROPERTIES WITH FARM ANIMALS OR HORSES (NOT ON A FARM) A risk with farm animals or up to 5 horses can be considered subject to underwriting approval. An acre per animal is desired or a risk with a small number of animals typically found on a farm. Further underwriting may be required to determine it is not a commercial exposure or a farm. PROTECTION CLASS The Protection Class listings in the Public Protection Classification Manual apply. Use PC 10 for unclassified areas, in a classified area where two or more classifications are shown (e.g. 6/9), the classification is determined as follows: Distance to Fire Station Class 5 road miles or less with hydrant* within a 1000 feet, use the first protection class (e.g. 6/9 would use Class 6) 6 5 road miles or less with hydrant* beyond a 1000 feet, use the second protection class (e.g. 6/9 would use Class 9) 9 Over 5 road miles 10 *Hydrant distance requirement does not apply when an alternative credible water supply is available. Refer to notes under specific communities in Public Protection Classification Manual for applicability. Vol Dwelling Basic October 2014 Page 18

19 COVERAGE OPTIONS ADDITIONAL INSURED In addition to the Named Insured listed in the Declarations, additional persons or organizations may be listed which are an insured of the residence premises. If the policy is cancelled or nonrenewed, the parties named will be notified in writing. This endorsement is not available for the LLC or Trust. Refer to Endorsement- DP ADDITIONAL INSURED (DESCRIBED LOCATION) AND DL ADDITIONAL INSURED (RESIDENCE PREMISES) IF LIABILITY IS SELECTED ADDITIONAL INTERESTS In addition to the Mortgagee(s) shown in the Declarations or elsewhere on the policy, additional persons or organizations may be listed which have an interest in the residence premises. If the policy is cancelled or non- renewed, the parties named will be notified in writing. This endorsement is available for the LLC or Trust which requires notification when the policy is cancelled or non-renewed. Refer to Endorsement- HO ADDITIONAL INTERESTS (RESIDENCE PREMISES) BUSINESS PURSUITS - NO COVERAGE This program does not offer coverage for liability arising out of business activities. Applicants who conduct business from a residence that includes client traffic or contact are not eligible for this program. CONDOMINIUM UNIT-OWNERS COVERAGE A Dwelling Property policy may be issued to the owner(s) of a condominium or cooperative unit which is used exclusively for residential purposes and is not occupied by more than one additional family or more than two boarders or roomers. Building items are not covered in the Dwelling Property Program unless the form is be amended to include Coverage A. Refer to Endorsement- AIIC DP CONDOMINIUM UNIT-OWNERS COVERAGE. The minimum coverage when this option is selected is $25,000 and is available up to a maximum of $200,000 for an additional premium. The coverage may be selected in $5,000 increments. Premium 1. Fire and E.C. The following rates per $1,000 apply to all occupancies, territories, construction and protection classifications. Fire Protection Class 1-8 $ $4.42 E.C. $2.29 Vol Dwelling Basic October 2014 Page 19

20 2. V&MM Rate per $1,000 Not seasonal/ Not Vacant: $0.08 Seasonal/Not Vacant : $0.39 COVERAGE B - OTHER STRUCTURES A. Applicant(s) may select a desired coverage limit for other structures located on the residence premises. Other structures may not be used for business purposes except permitted incidental occupancy or rented for use as a private garage, rented to others, or used by non-related persons for residence purposes. Coverage for Other Structures described as covered under Coverage B is automatically provided on a blanket basis for up to 10% of the Coverage A limit. Use of this option reduces the Coverage A limit for the same loss. B. Coverage may be purchased for specific structures up to 70% of Coverage A. C. Premium Enter the limit of liability and description of each structure in the Coverage Declarations of the policy at inception or by Change Endorsement after policy inception. 1. Fire and E.C. The following rates per $1,000 apply to all occupancies, territories, construction and protection classifications: Fire Protection Class 1-8 $ $3.84 E.C. $ Vandalism &Malicious Mischief Rate per $1,000 Not seasonal/not Vacant: $0.07 Seasonal/Not Vacant: $0.34 COVERAGE C PERSONAL PROPERTY Personal Property is not included unless selected. a maximum of 70% of the Coverage A. Limits may be purchased in $1,000 increments to COVERAGE D FAIR RENTAL VALUE Up to 10% of coverage A- Dwelling is available. Use of this option reduces the Coverage A- Dwelling limit for the same loss. The limit may not be increased. DEDUCTIBLES All policies are subject to a deductible that is applied to a Section I- Property loss. The two deductibles are an All Other Perils Deductible and a Hurricane Deductible. When Wind coverage is included in the policy, the base deductibles are: $1000 All Other Perils deductible 2% Hurricane deductible (minimum $500) Vol Dwelling Basic October 2014 Page 20

21 When a loss occurs from a peril other than Hurricane, the All Other Perils deductible will be applied to the reported occurrence. If a reported loss is due to a Hurricane then the deductible will be applied as outlined in the following section as well as optional deductibles. A. Fire and V&MM - Windstorm Included or Excluded To compute the premium debit for lower deductibles, multiply the BASE PREMIUM by the applicable factor below. Deductible Amount - DEBIT Deductible $500 FIRE V&MM To compute the premium credit for higher deductibles, multiply the BASE PREMIUM by the applicable factor below. Deductible Amount (CREDIT) Deductible $2,500 (0.07) FIRE V&MM (0.35) B. Extended Coverage Perils - Windstorm Coverage Included To compute the premium debit for lower deductibles or the credit for higher deductibles, multiply the BASE PREMIUM by the following applicable factors. Extended Coverage Wind Included Deductible Factors All Other Perils: $500 $500 $1000 $2,500 $500 $1,000 $2,500 $500 $1,000 $2,500 Hurricane: $500 2% $500 2% 5% 5% 5% 10% 10% 10% debit debit debit (credit) (credit) (credit) (credit) (credit) (credit) (credit) Dwelling (0.12) (0.11) (0.20) (0.32) (0.16) (0.25) (0.37) Personal Property (0.10) (0.01) (0.0) (0.10) (0.05) (0.15) (0.18) Hurricane Deductibles (Not available for policies excluding wind) A hurricane deductible subjects the policy to a percentage deductible amount that applies to any Section I- Property loss due to damage from the perils of Hurricane. During a hurricane, the deductible will be applied beginning at the time a hurricane watch or warning is issued for any part of Florida by the National Hurricane Center of the National Weather Service and will end 72 hours following the termination of the last hurricane watch or hurricane warning issued by the National Weather Service. A Hurricane means a storm system that has been declared to be a hurricane by the National Hurricane Center of the National Weather Service. The National Weather Service currently uses the Saffir/Simpson Hurricane scales to categorize hurricanes. This scale specifies that a hurricane is a storm that originates in the tropics and results in either a sustained wind speed of at least 74 miles per hour or a storm surge of at least 4 feet above normal. Vol Dwelling Basic October 2014 Page 21

22 A hurricane deductible shall apply on an annual basis to all covered hurricane losses that occur during a calendar year, regardless of the policy term. If there was a hurricane loss for prior hurricane(s) during a calendar year, the deductible applying to a subsequent hurricane loss is the greater of the remaining amount of the hurricane deductible or the amount of the deductible that applies to perils other than a hurricane. Hurricane deductibles may only be changed at time of renewal. Note: Hurricane deductible options may only be amended at renewal of the policy. A policy may not be cancelled and rewritten to circumvent this rule. Refer to Endorsements- AIIC DP1 09 HD CALENDAR YEAR HURRICANE DEDUCTIBLE WITH SUPPLEMENTAL RECORD KEEPING REQUIREMENT EXTENDED COVERAGE PERILS - WINDSTORM COVERAGE EXCLUDED 1. Base Deductible All Other Perils Deductible = $1,000 Hurricane Deductible = No Coverage 2. Optional Deductibles Deductible Amount PREMIUM DEBIT All Other Perils Deductible $500 Dwelling and Personal Property Coverage 0.19 Deductible Amount PREMIUM CREDIT All Other Perils Deductible $2,500 Dwelling and Personal Property Coverage 0.36 Note: Any combination of Dwelling and Contents deductible chosen must be consistent. Deductible Option Restrictions 1. A $500 Hurricane deductible is not available when: (a) Coverage A exceeds $249,999, or if (b) a tenant named insured risk, or (c) a condominium unit-owners risk. 2. The $2500/2%, $1000/5%, and $2500/5% deductible options are not available for (a) risks with Coverage A less than $100,000; or (b) a tenant named insured risk, or (c) a condominium unitowners risk with Coverage C less than $100,000. Note: The deductible options restrictions in paragraph 2, may be superseded by mandatory deductibles due to underwriting considerations. 3. The $500/5% and $1,000/10% deductible options are not available for (a) risks with Coverage condominium unit-owners risk with Coverage C less than $10, The $500/10% deductible option is not available for (a) risks with Coverage A less than $5,000 or if (b) a tenant named insured risk or (c) a condominium unit-owners risk with Coverage C less than $5,000. Vol Dwelling Basic October 2014 Page 22

23 5. The $2,500/10% deductible option is not available for (a) risks with Coverage A less than $25,000 or (b) a tenant named insured risk or (c) a condominium unit-owners risk with Coverage C less than $25,000. INCREASED LIABILITY COVERAGE LIMITS When selected the policy form provides basic limits of $100,000 per occurrence for Coverage L - Personal Liability and $2,000 per person for Coverage M - Medical Payments to Others. Liability coverage may only be provided in conjunction with a dwelling policy. Coverage Number of Families Limit ,000/2, ,000/2, Liability coverage for home day care operations is not available in this program. LIMITED FUNGI, MOLD, WET OR DRY ROT, OR BACTERIA COVERAGE ENDORSEMENT The basic policy includes $10,000 each covered loss/$10,000 aggregate property damage coverage. When Personal Liability is selected, DL LIMITED FUNGI, WET OR DRY ROT, OR BACTERIA COVERAGE is automatically attached to the policy to provide an aggregate Section II policy limit of $50,000. LOSS ASSESSMENT COVERAGE The policy does not provide coverage for any damage as a result of a property loss assessment for which the insured may be liable. When the policy is endorsed, this coverage is only available for Condominiums and/or Co-operative units. Beginning 1/1/2009, all policies covering condominium units must be issued with a minimum Loss Assessment Coverage of $2,000 per Section (g) F.S. This limit may be increased to a higher optional amount of $5,000, or $10,000. Higher optional limits may only be purchased at policy inception or upon renewal (mid-term increases are not available). Refer to Endorsement- DP LOSS ASSESSMENT PROPERTY COVERAGE Additional premium: Limit Premium $ 2,000 $6 $ 5,000 $15 $ 10,000 $25 OTHER INSURED LOCATION - NO COVERAGE This program does not permit liability coverage for other residences owned by the insured regardless of occupancy. Both property and liability coverage for secondary residences rented to others or used on a Secondary/Seasonal basis may be provided by issuing a separate Homeowner or Dwelling policy. Vol Dwelling Basic October 2014 Page 23

24 SINKHOLE LOSS COVERAGE- FLORIDA The base policy covers Catastrophic Ground Cover Collapse as defined by Florida Statute The premium is included in the base premium and it cannot be excluded. Sinkhole Loss Coverage is excluded in the base policy, but may be purchased for an additional premium. A 10% Sinkhole Deductible will apply to all policies that include Sinkhole Loss Coverage. For all territories, new policies may be bound only with the Catastrophic Ground Cover Collapse. If the policyholder elects the option for Sinkhole Loss Coverage, an approved structural inspection of the home must be completed prior to adding the coverage. An approved inspection service is one that has been designated by us as competent to perform the evaluation, and whose report format meets our informational requirements. The insured will contract directly with the approved inspection service, and pay an arranged fee, which will be half of the amount we have negotiated with the inspection service. We will pay the other half and both parties will receive a copy of the inspection. The fee will not be refundable no matter the underwriting decision reached. The inspection will document existing damage, evaluate the structural integrity of the dwelling (such as cracking, shifting or settlement of the house, doors that will not close properly, etc.) for any visible depressions or voids in the ground and verify that there is no current or proximate sinkhole activity that has not been disclosed. For risks that do not pass inspection, the insured may request a policy without Sinkhole Loss Coverage (the policy will continue to include Catastrophic Ground Cover Collapse Coverage). Besides new business, the only other time Sinkhole Loss Coverage may be added is at renewal. A sinkhole inspection must be performed prior to adding Sinkhole Loss Coverage as outlined above. Optional Sinkhole Loss Coverage will be approved for the dwellings that do not display characteristics of existing damage or proximity to sinkhole activity. Risks that do not pass the sinkhole inspection will not be allowed to add the Sinkhole Loss Coverage. A completed AIIC 01 DP SKS Sinkhole Loss Coverage Selection/Rejection form must be submitted on all requests for a comparable policy without Sinkhole Loss Coverage. The insured must select the statement I want to REJECT Sinkhole Loss Coverage. Refer to Endorsement AIIC DP1 09 SH SINKHOLE LOSS COVERAGE FLORIDA and the Wind Exclusion Credits and Sinkhole Loss Coverage tables for premium factors. THEFT COVERAGE NO COVERAGE Theft Coverage is not available in the Dwelling Property 1 Basic program. LIMITED SCREENED ENCLOSURE AND CARPORTS COVERAGE (NOT AVAILABLE FOR POLICIES EXCLUDING WIND COVERAGE) Coverage for a loss caused by wind or hail to aluminum framing for screen enclosures, pool cages, and car ports permanently attached to the dwelling may be purchased for an additional premium. Coverage limits are available from $10,000 to $50,000. The available limits of liability are listed below: Vol Dwelling Basic September 2013 Page 24

25 Additional premium: Limit Coastal Counties* Inland Counties* $10,000 $100 $50 Per each $1,000 $10 $5 Refer to Endorsement- AIIC DP1 09 WSE LIMITED SCREENED ENCLOSURE AND CARPORT COVERAGE * Coastal Counties are defined as any territory contained in a county that borders the Gulf of Mexico or the Atlantic Ocean with the exception of Jefferson inland, territory 525. That territory consists of other inland counties and will be defined as Inland Area. Inland Areas are all territories not included in Coastal Areas. WINDSTORM OR HAIL EXCLUSION- FLORIDA The peril of Windstorm or Hail may also be excluded for all coverages, including Coverage D Fair Rental Value, anywhere in the state upon written request of the insured(s) named on the policy and written authorization from any mortgage holder or lien holder with an interest in the insured location, per Florida Statutes. If Windstorm or Hail coverage is excluded and the insured property is not eligible for wind-only coverage from CPIC, the insured must use form AIIC DP 01 XW REQUEST TO EXCLUDE WINDSTORM OR HAIL COVERAGE and personally write and provide to the Company in his or her own handwriting, signing his or her name (and signed by any other named insured on the policy) the following statement (the statement must also be dated): I do not want the insurance on my home/mobile home/condominium unit to pay for damage from windstorms or hurricanes. I will pay those costs. My insurance will not. A written statement from any mortgage holder or lien holder must also be sent to the Company approving of the policyholder electing to exclude windstorm or hurricane coverage from the policy. All necessary documents must be received and approved by the Company prior to the attachment of the exclusion to the policy. The Exclusion will apply to all subsequent renewals until removed. This exclusion may only be added or removed effective at policy inception or renewal. Further, we will require this endorsement in some territories based on capacity. When wind and hail are excluded, apply the following base Premium Determination (Extended Coverage Only): 1. Determine the appropriate Windstorm or Hail Exclusion Credit from the applicable rate page. 2. Subtract this credit from the Other Perils Key Premium to develop the Other Perils Adjusted Key Premium. 3. Multiply the Other Perils Adjusted Key Premium by the Key Factor to develop the Other Perils BASE PREMIUM. Refer to Endorsement- DP WINDSTORM OR HAIL EXCLUSION Vol Dwelling Basic October 2014 Page 25

26 VANDALISM AND MALICIOUS MISCHIEF For an additional premium the perils of Vandalism or Malicious Mischief may be purchased. T o develop the BASE PREMIUM by multiplying the same limit of liability selected for Extended Coverage by V&MM rate and round to the nearest whole dollar. Rate per $1,000 Non Seasonal and Non-Vacant: $0.09 Seasonal and Non-Vacant: $0.44 PREMIUM CALCULATIONS This section provides explanation of how premiums are determined and what adjustments are applied to price each risk. To compute the BASE PREMIUM, use the Key Premiums and Key Factors that are displayed in the state rate pages shown below. A. Develop separate BASE PREMIUMS on buildings and/or contents for: Fire only, or Fire and Extended Coverage, or Fire, Extended Coverage and V&MM Coverage A Dwelling Coverage C - Personal Property 1. From the Key Premium Table, select the Key Premium for the classifications or coverages that apply to the risk. 2. From the Key Factor Table, determine the Key Factor for the desired limit of liability. If the desired limit of liability is not shown in the table, determine as illustrated in paragraph B of this rule. 3. Multiply the Key Premium by the Key Factor and round to the nearest whole dollar to develop the BASE PREMIUM ($.50 or more rounded to the next higher whole dollar). B. Determination of Missing Key Factors When the desired limit of liability is less than the highest limit shown, determine the Key Factors using the nearest limit above and below the desired limit. Example: Using Key Factors for Seasonal and Non- Seasonal Owner Occupied Properties: $25,500 desired limit; the nearest limits are $24,000 and $26,000. For $24,000 the Key Factor is 1.065; for $26,000 the Key Factor is Figure the difference between the two Key Factors and divide by 20. This provides a factor per $ Vol Dwelling Basic October 2014 Page 26

27 .033 divided by 20 =.0016 Multiply the factor per $100 times 15, and add 1.065; the Key Factor for $24,000;.0016 x = The result, 1.089, is the Key Factor for this example. AGE OF DWELLING The age of a dwelling is the year in which construction of the residence was completed from the year in which the policy is effective. A home 36 years of age or older will have a 10% surcharge applied to the Fire, Extended Coverage and/or Vandalism/Malicious Mischief premium when selected. All homes built in 2002 or later receive a minimum additional 68% FBC 2001 new home credit (.32 factor) on the hurricane premium. New homes built in wind speed design zones greater than 110 mph receive a higher discount. TOTAL RENOVATIONS If acceptable documentation demonstrates that a residence has been a total renovation*, the year in which the renovation began may be used as the date of construction. A total renovation (will require a new certificate of occupancy or certificate of completion) is defined as a home with updates to include new electrical wiring at the panel and in all walls, new plumbing (above the slab) and in all walls, heating and A/C to include the duct work, roof and window systems, and must be verified by a certified inspector based on an on-site inspection. *Complete documentation should be submitted to underwriting prior to binding. BUILDING CODE EFFECTIVENESS GRADING The Building Code Effectiveness Grading Schedule develops a grade of 1 to 10 for a community based on the adequacy of its building code and the effectiveness of its enforcement of that code. Policies may be eligible for special rating adjustments subject to the criteria in this section. In some communities, two Building Code Effectiveness Grades may be assigned. One grade will apply to 1 and 2 family dwellings and the other to multiple unit dwellings. The Public Protection Classification Manual will indicate the application of each grade. The Building Code Effectiveness Grades for a community, and their effective dates, are provided in the Public Protection Classification Manual published by ISO Commercial Risk Services, Inc. COMMUNITY GRADING The Building Code Effectiveness Grade applies to any building that has an original certificate of occupancy dated in the year of the effective date of the community grading, or later. If a community is re-graded subsequent to its initial grading, the factor for the revised grade applies to buildings that have an original certificate of occupancy dated the year of the effective date of the revised grading, or later. Vol Dwelling Basic October 2014 Page 27

28 Where certificates of occupancy are not issued, reasonable evidence of year of construction will be accepted. If, due to an addition or alteration, the original building is changed to comply with the latest building code, the factor for the community applicable at the time the reconstruction is completed will apply. INDIVIDUAL GRADING Where buildings have been built in full conformance with the natural hazard mitigation elements of one of the nationally recognized building codes even though the community grade is greater than 1, or the community is not participating in the program, exception rating procedures may apply. Any building may be classified as Grade 1 for Windstorm or Hail upon certification by a registered or licensed design professional based on an on-site inspection that such building is in compliance with one of the three nationally recognized building codes with respect to mitigation of the windstorm and/or hail hazard. This classification is effective only from the date of the certification. UNGRADED AND NONPARTICIPATING RISKS Buildings that do not meet the criteria above for community or individual grading should be coded as "Ungraded". Do not classify as 10. Premium Computation Dwelling Community Grading Compute the premium credit or debit as follows: a) Multiply the KEY PREMIUM for EXTENDED COVERAGE for Dwelling and Personal Property by the appropriate factor shown in the applicable table. b) Multiply the result above by the KEY FACTOR for the desired amount of insurance. BUILDING CODE COMPLIANCE FACTORS ALL DWELLING POLICIES Territory 1 50, 70, 310, 360,361 Territory 2 Territory 3 100, 120, 121, 122, 123, 124, 125, 126, 127,128, 129, 130, 131, 132, 133, 134, 141, 142, 143, 144, 145, 146, 147, 150, 180, 181, 182, 320, 340, 350, 370, 380, 381, 420, 440, 441, 442, 464, 410, 450, 451, 452, 453, 454, 455, 456, 457,458, 459, 460, 461, 462, 463, 465, 466, 480 Territory 4 430, 470, 471, 472, 473, 481 Territory Territory 6 390, 500, 510, 511, 520, 521, 522, 523, 524, 525, 526, 527, 528, 529 Territory GRADE Community Grade Code 1 (01) 2 (02) 3 (03) 4 (04) 5 (05) 6 (06) 7 (07) 8 (08) 9 (09) 10 (10) Non- Un-graded Participating Individual Grade Code (11) (12) (13) (14) (15) (16) (17) (18) (19) (20) (99) (98) Vol Dwelling Basic October 2014 Page 28

29 Territory Group Credit Credit Credit Credit Credit Credit Credit Credit Credit Debit TOWN OR ROW HOUSE Obtain the number of units within a Fire Division to determine the rate for the Risk. When the number of units within the fire walls is greater than 4, the risk is not eligible for the program (refer to Town/Row house section of the manual). DISCOUNTS/SURCHARGES HARDIPLANK SIDING DISCOUNT A HardiPlank* siding discount is available to a home of frame construction that has this siding material on all exterior sides. *HardiPlank and HardiPanel are brand names for fiber cement siding manufactured by James Hardie Building Products. The fiber cement siding is made from Portland cement mixed with ground sand, cellulose fiber, and other additives. Fiber cement siding can resemble stucco, wood clapboards, or cedar shingles, depending on how the panels are textured. Fiber cement siding is more durable than wood or stucco, and is also fire resistant. Although more expensive than vinyl, fiber cement siding is considerably less expensive than wood. Fiber cement siding has become popular because it requires little maintenance and can have a natural, wood-like appearance. Apply factor:.95 LAPSE IN COVERAGE/ NO PRIOR INSURANCE SURCHARGE Risks with a lapse in coverage that exceed 45 days from the effective date of the last active policy or no prior insurance coverage will have a 10% surcharge applied. The 10% surcharge will be applied for one (1) year from date of issuance. The surcharge does not apply to first time home buyers or renewals. Force placed insurance is not considered acceptable proof of prior insurance. Apply factor: 1.10 PROTECTIVE DEVICES DISCOUNT Approved and properly maintained installations of fire alarms and automatic sprinklers in the Vol Dwelling Basic October 2014 Page 29

30 dwelling may be recognized for a reduced premium. The amount of the credit is computed by multiplying the BASE PREMIUM by the appropriate factor shown below. All devices must be professionally installed (not do it yourself ), and a copy of the installation certificate submitted with the application should be retained in the agent's file and is subject to periodic audits to ensure compliance with all rules and guidelines. Note: Burglar alarm credits are not available. Fire Alarm Central Station Reporting credit factor is.08 Note: The maximum credit factor granted for a central station reporting fire alarm is Automatic Sprinkler Systems 1. Class A: The automatic sprinklers must be in all areas except that attics, bathrooms, closets and attached structure areas may be protected by fire detectors in lieu of sprinklers. The credit factor for a Dwelling Policy = Class B: The automatic sprinklers must be in all areas including attics, bathrooms, closets and attached structure areas. The credit factors for a Dwelling Policy =.15 Required Documentation For fire alarms, a legible copy of the certificate of installation that includes a monitoring agreement or a current legible copy (not more than one (1) year old) of the monitoring subscription agreement is required to be kept at the agent s office. For fire sprinkler systems, a copy of the certificate of installation from a sprinkler contractor licensed per Florida Statute is required. The sprinkler contractor must hold either a Class I, II or IV license and must certify that the installation substantially complies with National Fire Protection Association (NFPA) sprinkler standard 13, 13D or 13R. Refer to Endorsement- AIIC DP PREMISES ALARM OR FIRE PROTECTION SYSTEM PREMIUM FACTORS - HURRICANE BASE RATE Vol Dwelling Basic October 2014 Page 30

31 WINDSTORM LOSS MITIGATION FEATURES A. ELIGIBLITY When a policy covers the perils of Windstorm or Hail a risk may be eligible for a premium credit upon appropriate underwriting and, where applicable, the Company's receipt of an attestation as described below. The credits are listed on the following tables. Please refer to the appropriate table for existing homes or for new construction permitted after March 1, 2002 (the effective date of the Florida Building Code (2001)). The applicant or insured may obtain the hip-roof credit by submitting pictures showing the entire roofline of the dwelling and a statement from the insured that the pictures depict the insured dwelling. For all other credits applicable for dwellings permitted prior to March 1, 2002, the applicant or insured must submit a Windstorm Loss Reduction Credit Verification Affidavit in order to qualify for credits. The form must be completed by a licensed building contractor or a registered architect or engineer or a building code official. A dwelling permitted prior to March 1, 2002, is not required to meet all of the minimum standards of the Florida Building Code (2001) in order to qualify to the credits. Credits will apply to dwellings permitted after March 1, 2002, based upon application for the Florida Building Code in the territory in which the dwelling is located, subject to the company's right to request verification of construction features. The policyholder is responsible for providing proof of compliance and for all expenses associated with substantiating the existence of mitigation features. Partially completed forms will receive credit to be determined using the information that is provided and assuming that the home contains no other credit features. B. MITIGATION CREDIT TABLES Mitigation Credit Tables have been developed for implementation of this rule that apply to either new construction or existing construction by building type. C. VERIFICATION The Company will require proof that substantiates the existence of loss mitigation features. This proof will be in the form of verification by a registered or licensed design professional certified building inspector or licensed General Contractor. A Florida Building Code Mitigation Verification Affidavit is available for use in satisfying this requirement. However, other signed and dated documentation from a duly qualified professional may be acceptable subject to underwriting review. The insured is responsible for the expense associated with substantiating the existence of the mitigation features. No verification documentation beyond shutter documentation, appropriate pictures and permit documents are required for dwellings constructed on or after January 1, Dwellings with a construction permit dated prior to must submit a Florida Building Code Mitigation Verification Affidavit. D. DEFINITIONS OF TERMS New Construction - Risks constructed subject to the 2001 version of the Florida Building Code. Existing Construction - Risks constructed prior to January 1, High Velocity Hurricane Zone (HVHZ) Miami-Dade and Broward Counties. Vol Dwelling Basic October 2014 Page 31

32 Terrain Terrain C - Miami-Dade and Broward counties, all barrier islands and all risks within 1500' of the coastline. Terrain B - All areas not included in Terrain C. FBC Wind Speed - Design wind speed (3 second gusts) for the site location as determined by the wind speed map in figure 1606 of the Florida Building Code. FBC Wind Design Speed - Wind speed (3 second gusts) for which the structure is designed to withstand according to the FBC Basic (minimum) Wind Design Speeds (SDS) are established for each FBC Wind Speed Zone. When the WDS of the structure (1-4 unit building built on or after January Building Code Mitigation Verification Affidavit. Vol Dwelling Basic October 2014 Page 32

33 Vol Dwelling Basic October 2014 Page 33

34 Roof Cover - The covering applied to the roof deck for weather resistance, fire classification or appearance. The most common roof covering materials in Florida are composition shingles and tiles. A key factor in roof covering performance is the method of attachment of the roof covering to the roof deck. The Florida Building Code 2001 (Section 1504) has material requirements and attachment specifications that are superior to common roof covering building practices in the past. For composition shingles, these requirements include self-seal strips and compliance with ASTM D-3161 (Modified for 110 mph). This requirement is commonly referred to as the "110 mph" rated shingle. FBC Equivalent - The roof covering specifications of the 1994 SFBC also require improved attachment methods and testing to a similar protocol. Therefore, these roof coverings are considered to be sufficiently similar to FBC roof coverings to be classified in the "FBC Equivalent" category. The rating of roof covering for existing construction can be achieved by requiring the roofing contractor to certify that a prior installation met the 1994 SFBC or the FBC 2001 requirements. Otherwise the current roof covering should be rated as Non-FBC equivalent. Insurers should remind owners of existing houses that when the re-cover their roofs, they need to have their contractor certify that the installation meets the FBC 2001 Chapter 15 requirements in order to receive the new roof covering credit. Non-FBC Equivalent - Roof coverings that do not meet the 1994 SFBC or the FBC 2001 requirements. (see above) Roof Deck Attachment - The performance of the roof deck is of critical importance in keeping hurricane loses to a minimum. It usually only takes the loss of a small portion of the roof deck before the losses for the building become substantial. Rain enters into the building and produces water damage to the interior and contents. The most common roof deck types are plywood and Oriented Strand Board (OSB) decks. Prior to the availability of plywood, the most common roof decking was dimensional lumber or tongue and groove boards. Dimensional lumber or tongue and groove boards are nominally thick and are laid in a fashion that is parallel to the ridge or diagonal to the ridge. These roof decks are fastened by at least two nails per truss/rafter connection. Because of the inherently large number of nails in dimensional lumber or tongue and groove, the uplift capacity is generally far greater than typical plywood/osb decks. By far the most important feature of roof decks is the attachment to the framing, which is usually achieved by nail fasteners. Nail size, type, spacing and penetration depth into the truss or rafters determines the uplift resistance of the deck. The difference in uplift capacity of 8d (2 1/2 inch) nails at typical nail spacing and 6d (2") nails at the same spacing is a factor of about two times stronger, which makes a significant difference in deck performance in hurricanes. The thickness of the deck material is also important primarily in the determination of the penetration depth on the nail into the truss/rafter. Prescriptive building codes specify longer nails for thicker decks. Level A - Plywood/OSB nailed with 6 penny common nails at 6" spacing on the edge and 12" in the field on 24" truss spacing. This provides for a mean uplift resistance of 55 lbs per sq ft. Level B - Plywood/OSB nailed with 8 penny common nails at 6" spacing on the edge and 12" in the field on 24" truss spacing. This provides for a mean uplift resistance of 103 lbs per sq ft. Vol Dwelling Basic October 2014 Page 34

35 Level C - Plywood/OSB nailed with 8 penny common nails at 6" spacing on the edge and 6" spacing in the field on 24" truss spacing. Within 4'of a gable end the nail spacing is 4". This provides for a mean uplift resistance of 182 lbs per sq ft. for non-gable end locations and 219 lbs per sq ft for gable end locations. Level D - Dimensional lumber and tongue and groove decks. Over 90% of the RCMP inspected dimensional lumber decks have 8d or greater nails. The case of two 8d nails per board produces a mean uplift resistance of 338 lbs per sq ft. There are many technical issues that affect the proper rating of the roof deck including a variety of available nail sizes, nail penetration depths, the consideration of missed nails, etc. Proper inspection guidelines and training are essential to determining the deck attachment of existing residences. Roof-Wall Connection - The roof to wall connection is another critical connection that keeps the roof on the building and acts to transfer the uplift loads into the vertical walls. This connection is key to the performance of the building due to the large negative pressures acting on the roof. Verification of the type of roof to wall connection requires access to the attic to inspect for accurate house rating. There are several manufacturers of the metal connectors for hurricane uplift connectors and each company has a fairly wide line of products. For practical purposes, a classification is used to distinguish the uplift capacity of these connections based on connector type. The most important feature of any of these connectors - other than toe nails, is that the fasteners used to transfer the loads from rafter/truss to strap to top plate or side wall are always loaded in shear (perpendicular to the nail direction) or the strap is embedded into the bond beam of the masonry wall. Proper installation is critical to connector performance. Toe Nails - A common connection detail in non-hurricane prone areas is the toe-nail, where approximately 3 nails are driven at an oblique angle through the rafter and into the top plate. Clips - Clips are defined as pieces of metal that are nailed into the side if the rafter/truss and into the side of the top plate or wall stud. The metal does not wrap around the top of the rafter/truss and the clip is only located on one side of the connection. Single wraps - The wrap style straps are attached to the side and/or bottom of the top plate and are nailed to the rafter/truss. Double wraps - Straps that are wrapped on both sides of the top plate. Double wraps have twice the capacity of a single wrap. Reinforced Concrete Roof Deck - Although not very common in residential roof construction in Florida, there are homes constructed with concrete roof decks. When these homes are equipped with wind-borne debris impact resistant opening protection, they are extremely resistant to building failures. To qualify for this type of construction, the roof deck must be designed and constructed in accordance with ACI (American Concrete Institute) 318, including integral construction with a masonry wall system. Opening Protection Openings in the wall and roof include windows, doors, sliding glass doors, skylights and garage doors. Gable end vents and other roof vents are not considered openings for purposes of this program. Openings are vulnerable to wind-borne debris impacts in hurricanes and other windstorms. Typical single and double strength glazing are easily broken by impact from Vol Dwelling Basic October 2014 Page 35

36 lightweight debris that is generated from roof covering failures during high winds. In addition, heavier debris such as roof tiles, 2X4 wood members and plywood will easily penetrate openings that are not protected by impact resistant products. The protection of openings is perhaps the greatest single loss mitigation strategy for a building. The reason for this is that once a window or door fails, the pressure inside the structure increases due to the breach in the building envelope. The positive pressure inside the building produces an additive load on the building envelope which can be up to twice the load the building would experience without the breach. Hurricane Impact (Class A) All exterior openings or all glazed exterior openings in buildings (doors, windows, skylights and vents, other than roof ridge, gable, soffit and plumbing vents) must be fully protected with impact resistant coverings (e.g. shutters), impact resistant doors, and/or impact resistant window units that are listed as wind borne debris protection devices in the product approval system of the State of Florida or Miami-Dade County. For buildings located in the HVHZ (High Velocity Hurricane Zone) all openings must be protected. Wind borne debris protection systems must have either a Miami-Dade NOA or FBC product approval denoting For Use in the HVHZ. All opening protection devices must meet the following Cyclic Pressure and Large Missile Impact standards as appropriate: Miami-Dade County Notice of Acceptance (NOA) 201, 202 and 203. (Large Missile - 9 lb.) Florida Building Code Testing Application Standard (TAS) 201, 202 and 203. (Large Missile 9 lb.) American Society for Testing and Materials (ASTM) E 1886 and ASTM E (Large Missile 9 lb.) Southern Standards Technical Document (SSTD) 12. (Large Missile 9 lb.) For Skylights Only: ASTM E 1886/E (Large Missile lb.) For Garage Doors Only: ANSI/DASMA 115. (Large Missile 9 lb.) Basic Impact (Class B) All exterior openings or All glazed exterior openings in buildings (doors, windows, skylights and vents, other than roof ridge, gable, soffit and plumbing vents) must be fully protected with impact resistant coverings (e.g. shutters), impact resistant doors, and/or impact resistant window units that are listed as wind borne debris protection devices in the product approval system of the State of Florida or Miami-Dade County. All opening protection devices must meet the following Cyclic Pressure and Large Missile Impact standards as appropriate: ASTM E 1886 and ASTM E (Large Missile 4.5 lb.) SSTD 12. (Large Missile 4 lb. to 8 lb.) For Skylights Only: ASTM E 1886/E 1996 (Large Missile - 2 to 4.5 lb.) All other cases, including unprotected glazed openings. Roof Shape - Roof shape refers to the geometry of the roof and not the type of roof covering. There are many common roof shapes in residential construction. Gable and hip are the most common although flat, Dutch hip, gambrel, mono slope and many shape combinations are possible. Gable roofs have vertical walls that extend all the way to the top of the inverted V and are very common throughout Florida. A hip roof has sloping ends and sloping sides down to the roof eaves line. Vol Dwelling Basic October 2014 Page 36

37 Roof shape determines the aerodynamic pressure loads experienced by the roof due to wind flow and wind direction. Gable and hip shapes and their combinations comprise more than 80% of the residential buildings. Secondary Water Resistance (SWR) - Secondary water resistance is a layer of protection that protects the building if the roof covering fails. This mitigation technique is aimed at keeping rainwater out of the house once the roof covering fails. Generally, roof coverings begin to peel off in peak wind gusts ranging from about 70 to 100 mph. The underlayment (felt) also is easily torn and becomes separated from the roof deck, exposing the house interior to water damage. Water enters through the space between the pieces of the roof deck. SWR covers these seams and provides for redundant water proofing of the house. The most economical way to achieve SWR is to apply Self-Adhering Modified Bitumen Tape to the plywood joints. This self adhering tape is generally known as Ice & Water Shield or Peel N Seal and is a rubber like product applied directly to a roof deck to prevent damage from ice dams in northern climates. Here, the product is applied to the outside of a clean plywood/osb deck prior to the application of regular underlayment and roof covering. The application of SWR is done when a new roof covering is being put on the house. Another way to achieve SWR is a foamed polyurethane structural adhesive applied from inside the attic to cover the joints between all plywood sheets. Note that this product is also used to reinforce the connection between the trusses and roof sheathing, qualifying for improved roof deck attachment. Structural adhesives that meet standard AFG-01 should not be confused with foamed insulating products. The verification of SWR must be done at the time of application since, once covered, it is difficult to verify. The foamed structural adhesive applied from inside the attic however, is readily verified with an attic inspection. Roofing contractors should complete a form to provide certification for the owner in order to receive this credit. Note: underlayments or hot-mopped felts are not SWR. FBC 2001 Construction - Dwellings built to the standards of Florida Building Code 2001 which became effective 3/1/2001. Enclosed Building - An enclosed structure is designed assuming that all openings are closed and, therefore, the wind loads are determined using a small internal pressure inside the building. Partially Enclosed - A partially enclosed building is designed assuming that one or more areas of the building are open to allow wind to enter the building and pressurize the interior. Vol Dwelling Basic October 2014 Page 37

38 This pressurization means that individual parts of the building must be designed to withstand greater wind loads than an "enclosed" building and thus are stronger than the similar features of an "enclosed" house. However, the openings (windows, doors, etc) in partially enclosed designs are vulnerable to wind-borne debris impact failures and the resulting wind and rain water damage to the building interior and contents. For insurance rating purposes, clearly the design option chosen for a house in the Wind-Borne Debris Region of the FBC is a key factor in hurricane loss mitigation. Enclosed designs in the Wind- Borne Debris Region will have all glazed openings protected for debris impact. These buildings will perform better that partially enclosed designs and will have lower losses. E. WINDSTORM LOSS REDUCTION CREDITS FOR NEW CONSTRUCTION Dwellings Constructed to Florida Building Code 2001 and Later The Wind Premium Credits apply to all wind premium. The credits will apply to the entire calculated hurricane premium. Five percent of the extended coverage premium is for non-hurricane wind coverage. Therefore, the Windstorm Premium Credits apply to five percent of the extended coverage premium. Vol Dwelling Basic October 2014 Page 38