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22 Cards in this Set
- Front
- Back
- 3rd side (hint)
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Section 1 - what do Coverages A to D cover? |
A - dwelling, building. Replacement value B - other structures not attached, 10% of A, Replacement value C - personal property and household contents - 50% of A. Actual cash value but can add endorsement to get replacement cost. Generally covered anywhere in the world D - additional cost of living if insured peril doesn’t allow insured to occupy house, 30% of A |
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What Coverages are in section 2? |
E - personal liability as result of bodily injury or property damage F - medical treatment |
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6 HO forms |
HO2 - “broad form” or “form 2”, Least expensive at least comprehensive. 16 named perils. A replacement cost, B replacement cost, C ACV, D actual increased cost for all forms! HO3 - “special form” or “form 3”, maximum coverage for dwelling and other structures, open perils, most common for residences. Coverages like HO2 except 16 named perils for C HO4 - “contents broad form” or “form 4”, only Coverages C and D. C for 16 named perils and D open HO5 - “comprehensive form” or “form 5”, Most extensive along homeowner rooms, open peril coverage for all physical losses on dwelling, other structures and personal property. HO6 - “unit owners form” or “form 6” - unit owner, condo or co-op, 16 named perils. Coverage B part of A HO8 - “modified coverage form” or “form 8”, older homes where replacement cost exceeds market value or structure isn’t up to code. 11 named perils. Coverage A functional replacement cost |
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HO3 and HO5 have requirement for Coverage A. What is it? |
Subject to coinsurance if required amount isn’t met, generally 80% of replacement value. Only for partial loss, not total. Total losses limited to amount of coverage. Required to avoid reduction of benefits on smaller claims. 80% is the larger of: 1) ACV - replacement cost at time of loss minus depreciation 2) Amount carried / (80% * replacement cost) * replacement cost |
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Replacement cost vs actual cash value (ACV) |
Replacement cost - current market price, no depreciation (dwelling and other structures) Actual cash value - replacement cost at time of loss minus depreciation. Amount of soldon open market. (Personal property) can add endorsement to get a replacement cost |
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Coverage A and B exclusions |
Collapse, freezing of plumbing, HVAC fire protection sprinklers, freezing thawing water or ice damage, mold fungus wet rot, pet damage, bird vermin rodent insect damage, pollution, wear and tear, theft of construction materials for incomplete dwelling, vandalism malicious mischief if property vacant for 60+days B only exclusions - Detached structures if rented except garage if rented to tenant of primary residence and not use for business purposes |
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Coverage C exclusions |
Items insured by other coverage, animals, birds, fish, most motor vehicles, aircraft, hovercraft, property in an apartment regularly rented to others, tenant property, business property, water or steam |
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What does HO3 Coverage D insure? |
Loss of use. - Additional living expenses to maintain standard of living due to insured peril if residence unfit to live in. - Lost rental income and extra related expenses. -Up to two weeks of coverage if civil authorities prevent injured from dwelling if neighboring property caused by covered peril (even if no damage to insured’s property) |
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HO3 additional coverages |
-debris removal if caused by covered peril -fallen trees. Up to $500 per tree or $1000 per loss for removing fallen trees caused by wind storm, hail, ice, snow or sleet -trees, shrubs, plants and lawns if caused by nine perils (not weather) -collapse of all or part of a building if caused by 16 perils -reasonable repairs to preserve and protect property from further damage -property removal to protect from covered peril including damage incurred while moving or subsequent to move -Loss assessment coverage if home association or condo or co-op needs assessment, up to $1000 - Credit card, EFT or access to device, forgery, counterfeit money. Up to $500 per occurrence -fire department service charge up to $500 if property threatened by covered peril -landlords furnishings $2500 per occurrence for 16 perils except theft -ordinance or law. cost to repair to code that have been approved since original construction or latest renovations -grave markers and mausoleums for16 perils regardless of location |
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HO3 section 1 endorsements |
- Inflation guard endorsement. Increase A, B, C, D by indexed inflation each year - replacement cost for personal property. Increase - scheduled personal property. High-value items typically appraised to establish insured value, worldwide, open perils - Home business insurance coverage. Liability for the day today operations of day cares and other home businesses. Increases business property coverage - earthquake. With deductible usually between 5 and 10% - Other structures limit. Unattached structures worth more than 10% of dwelling to increase coverage B limit |
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Duties of insured after loss |
- Prompt notice to insurer, notify police if theft - notify credit card company or bank if Lost credit or debit card -reasonable effort to protect property from further damage - make inventory of damage to personal property - exhibit damage property to ensure - file proof of loss within 60 days of insurers request |
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What is the appraisal clause in HO3 section 1 conditions? |
If amount disputed, insured and insurer can get appraisers who will choose umpire. Majority of three binding. Hiring parties pay appraisers and split umpire fee |
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HO3 Section 1 exclusions |
- Ordinance or law. Repair or replacement to accommodate customer upgraded code - Earth movement including earthquake, volcanic eruption, landslide, earth sinking, shifting or rising - water damage including floods, back up from drains, sewers, sound, seepage through basement walls and foundation floors - Power failure unless caused by peril on insured’s property - neglect. Insured could have reasonably prevented - war - nuclear hazard - intentional loss |
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HO3 section 2 - what does it cover and which coverages? (No details re coverages) |
Liability incurred because of lawsuit for bodily injury or property damage. Usually cumulative $100,000 per occurrence but can increase with endorsement or umbrella liability. Coverages E and F |
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What does section II coverage E cover? |
Damages legally required of insured as a result of bodily injury or property damage. Insurer, in charge of defense and can choose to settle which is more typical than litigation |
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What does section II coverage F cover? |
Medical and or funeral expenses usually $1000 per person per occurrence. On insureds property if there with permission of insured. Off premises if caused by activity of insured |
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Additional coverages in HO3 section II |
Costs and expenses incurred due to injury or damage to person or others’ property. Examples: up to $1000 of property damage of non-insured, defending lawsuit, expenses incurred by insured at request, up to $250 a day for insured’s loss of earnings as a result of time spent assisting with defense of lawsuit, first aid expenses incurred by insured for non-insired’s bodily injury |
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HO3 section II exclusions - coverage E (Liability) |
-Bodily injury of insured -property rented, occupied or used by insured not covered unless damage caused by fire, smoke or explosion -contractual liability exposures for last assessment against insured as a member of an association, corporation or community |
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HO3 section II exclusions - coverage F (medical) |
- Injury to residence employee that happens off premises and not while on job - Injury to anyone who regularly resides at premises except residential employee |
- Injury to residence employee that happens off premises and not while on job - Injury to anyone who regularly resides at premises except residential employee |
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HO3 section II exclusions - coverage E and F |
- nuclear accidents - expected or intentional injury - most motor vehicles except off road recreational that don’t require registration - Business and professional activities - ownership or rental of non-insured locations like farms or rental property - watercraft except small motorized watercraft or sailboats - Aircraft - injury to person eligible for Worker’s Comp., non-occupational disability or occupational disease law - war - transmission of communicable disease - criminal activity - physical, mental or sexual abuse
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HO3 section II conditions |
- policy period - concealment or fraud - cancellation by insured |
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HO3 section II endorsements |
- Home business insurance coverage. Day-to-day operations of daycare another own businesses. Increases coverage from $2500 to 50% of coverage A - personal injury. Expands to personal injury and bodily harm, sickness or disease - watercraft endorsement. Expands the $1500 basic coverage with more liability and medical payments coverage |
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