Chapter 3 - Other Habitational Insurance Forms and Endorsements

Mobile Homes

Factory built on its own chassis and can be easily moved

Placed on concrete/timber foundation when stationary

Weight and use of space are major factors considered when building

4 Major causes of loss

• Fire, windstorm, hail, transportation

Mobile Homeowners Form Coverages

A - Mobile Home Building

• Includes appliances, furniture, and equipment forming a permanent part of the building

• Permanently attached carports/garages

• Awnings, skirting, porches, tie down equipment

• Emergency removal expenses - if there is a threat to the building from insured peril, up to 5% of A limit can go toward removal costs (removing water/electrical, towing/transportation) (No deductible for this extension)

C - Personal Property

• Personal property excluding the ones mentioned in A like appliances

Exclusions

• Loss or damaged caused when moving somewhere

  • Considered moving when levelling jacks/blocks are removed

  • All utilities removed

• Loss due to conversion, embezzlement, secretion of any person in possession of the building

  • If loss occurs due to dishonest acts

Basis of Settlement

• ACV for the building always

• RC for personal property unless otherwise stated

Some home that aren’t considered mobile

• Double wide mobile homes, modular homes, sectional houses

Tenants Package Forms

Tenant’s Basic Form - Named perils on everything, accidental glass breakage of building excluded

Tenants Comprehensive - All risks unless excluded

Tenants Package Form Coverages

C - Personal Property

• Includes improvements made by tenant

• Up to $500 for the following damage in part of building occupied by insured (excluding fire damage)

  • Damage from theft or attempted theft

  • Damaged caused to interior by vandalism or malicious act

D - Additional Living Expenses

• 20% of C

Condominium Unit Owners Insurance

Common sharing of elements like parking, landscaping, recreational areas

Condo owner must purchase insurance for value of building (including value of all units), the value of common elements

Personal Property insured on Named perils or all risks depending if the basic or comprehensive form is purchased

Coverage U1 - Unit improvements

• Also includes any materials intended to be used on improvements

Coverage U2 - Loss Assessment

• Coverage if condo owner’s insurance is: not enough, application of coinsurance penalty, cause of loss is not insured, breach of policy condition

Coverage U3 - Unit Additional Protection

• Coverage on unit excluding items covered in U1

• If condo owner insurance is inadequate

• 2.5 times the amount of personal property coverage

Basis of Settlement

• Personal prop is RC unless otherwise stated

• U1, U2 are RC

Seasonal Dwelling Insurance

Coverage Named Perils

No coverage for peril of transportation

The following are only covered is specified on coverage summary page:

• Burglary/robbery, vandalism/malicious act, glass breakage

Common exclusions

• Loss due to change of temp

• Freezer food

• Outdoor plants

Some insurers may agree to cover the seasonal dwelling under the Homeowners Basic Form, providing slightly broader coverages, but the following conditions normally apply:

• Principal residence insured with same insurer

• Must be year round residence capable

• Occupied at least 1 day in 60 day period

• Not rented

• Heating must be controlled by furnace or electricity

• Accessible by maintained roadway year round

Dwellings in the course of construction

This came about because Homeowners comprehensive usually excludes:

• Theft of materials from construction site

• Glass breakage due to vandalism or malicious act

• Water escape, rupture, freezing

Dwelling Under Construction - All Risks form usually has the following conditions:

• Limited to single or two family dwellings

• Must be owner occupied upon completion

• Coverage must be purchased no later than the completion of the foundation

• Insurance must be no less than estimate completed value

• Limited to one year

• Premium charged based on value of project completion

Rented Dwellings/Revenue Properties

These coverages normally exclude:

• Vandalism and malicious acts

• Sewer back-up

• Theft

Everything usually restricted to ACV

Usually only provide coverage if the insurer also covers the primary dwelling

What do Habitational Endorsements do

Provide coverage for excluded property/perils

Increase limits for property subject to special limits

Broaden coverages

Decrease the deductible

Remove coverage

Fine Arts Endorsement

Paintings, pictures, art that is rare, historically valuable, etc. (books, rugs, glass, etc.)

Coverage

• All risks is broadened to include:

  • Marring/scratching

  • All smoke

  • Earthquake

  • Theft by tenant or their members

  • Flood, sewer back up, seepage, other water

• Section A - Insures object when on the insured premises and in transportation IF they are insured at multiple locations (10% of total insurance can go toward loss at any other location excluding fairs/national exhibitions)

• Section B - Insures object when away from premises for prolonged period like exhibition, display, restoration. No coverage when at fairs/national exhibitions. Also includes coverage for ALL transportation in agreed territory

Insured can choose to insured on a Valued basis (V)

Key Exclusions:

• Breakage unless caused by insured perils

• Birds, vermin, rodents, insects

• Any process or work (restoration)

Special Conditions:

• 25% of coverage on newly acquired articles for 30 days

• Articles must be packaged by competent packagers for transportation

• Reinstatement - Coverage is not reduced when there is a loss (Insurer must be notified within 30 days of replacement)

• All Stat Conditions

• All objects separately described

• Breakage exclusion can be removed for additional premium

• For valued, an independent appraiser must be hired

Personal Articles Endorsement

High value belongings - Cameras, firearms, furs, jewellery, silverware, stamps/coins

Increases limits and broadens coverages of these types of items

Coverage

• All risks broadened to include

  • Sporting equipment due to its use

  • Chipping/marring/scratching/breakage

  • Loss while being worked on

  • Snowslide, earthquake, landslide

  • Theft by tenant or their members

  • Flood, sewer back up, seepage, other water damage

Valued coverage is optional

One key exclusion: musical instrument played for a fee

Special Conditions:

• Stamp/coin collections

  • Partial loss: $250 for single item, must be scheduled if more coverage required for an item by itself

  • Total loss: insured expected to insure 100%, amount payable for total loss = (insurance purchased/market value at time of loss) = %

• Up to $5,000 for newly acquired items which are already a type of item insured by the endorsement for 30 days when scheduled

• Reinstatement (Insurer must be notified within 30 days of replacement)

• Stat conditions

• Professionally used items must have full details submitted to insurer

• Appraiser for valued items

• When item totals become high, the insurer will need to authorize further additions

Increased Cost Demolition or Construction Endorsement

Pays additional costs which are required to comply with any lay regulating demolition, repair, construction after a loss

Coverage can be purchase for one or more of the following:

• Sprinkler by-law extension

  • Payment of the minimum amount required to comply with requirements for sprinkler systems

• Demolition or Construction extension

  • Payment of the minimum amount required to comply with requirements for construction, demolition, repair

Special Conditions

• Reinstatement (Insurer must be notified within 30 days of any articles acquired to make replacements)

Residence Glass Endorsement

Adds accidental glass breakage

As most IBC forms have this coverage already, this will reduce the deductible in those cases

No coverage while in construction

Seasonal/Secondary dwellings may require full details before having this endorsement

Sewer Back-up Endorsement

Broadens coverage to include the backing up or escape of water from a sewer, drain, sump, septic tank, eavestrough, downspout

Some insurers may have stricter coverage for this endorsement though

Insurers may also increase deductibles in areas of higher risk

Earthquake Endorsement

Removes earthquake exclusion

Usually subject to a deductible no less than 10% of total insurance on the dwelling

Premium will change depending on area

Vandalism or Malicious Act Extension Endorsement

Removes exclusion of this peril for seasonal/secondary dwellings

Excludes:

• While vacant

• While under construction

• To glass constituting part of the building

• Loss caused by theft or attempted theft

• Caused by any member of the household

Watercraft Endorsement

With watercraft limited to $1,000 for IBC habitational forms, this is not adequate for boats more expensive than canoes and small row boats

Two types: Outboard Motor and Boat Policy, Yacht Policy

Yacht Policy:

Property Insured:

• The boat, including permanently attached equipment

• The motor, including fuel containers

• The boat trailer

• Other equipment like batteries, oars, cushions, flairs, life jackets, etc.

Perils Insured:

• All risks, usually including transportation losses, collision with under/on water objects

Exclusions:

• Accumulative damage, however caused (dents, etc.)

• Wear and tear

• Any work done on the property

• Dishonesty of persons whom the property is entrusted to (except carriers for hire)

• While: rented to others, used to carry for compensation, operation during race/speed test

Loss of use: some insurers may provide $20/day up to $200 per policy period for rental of motor

Additional acquisition clause: varies significantly between insurers

Territory: usually restricted to Canada and continental USA

Basis of settlement: usually ACV or RC

Usually high (75%) retained premium since most of exposure is only during summer

Travel Trailer Floater Endorsement

Removes exclusion on owned trailers and their contents which exist on all habitational forms

Usually all risks and restricted to Canada and continental USA

Usually limits the coverage on jewellery, precious stones, watches, furs, etc. to a specific percentage of total coverage with a total limit

Removes need to purchase trailer coverage on auto policy

Some other key endorsements

Motorized vehicles like golf carts, ATVs, snowmobiles

Horses, livestock

Bicycles

Business property

Sport equipment, including sportswear