PnC Personal Lines Auto, HO, DP, Yacht

PAP (Personal Auto Policy)

HO ABC’s

Section 1:

• A- dwelling

• B- other structures

• C- personal property

• D- loss of use

Section 2:

• E- personal liability

• F- medical

HO Forms *SOBE

SO

• HO-3: special home

• HO-5: special home

• difference is in personal property (HO-3 is named, HO-5 is open)

BE

• HO-2: broad home

• HO-4: broad renter’s

• HO-6 broad condo

18 is BASIC

Additional Coverages

• trees, plants: $500

• landlord’s furnishings: $2500

• debris removal (if caused by covered peril)

• fire dept service charge

• grave markers: $5000

• loss assessment: $1000 for insured’s share of neighborhood HO Association involving common areas

• ordinance and law coverage: 10% of A for additional costs due to enforcement of any ordinance or law

Coinsurance Formula

(DID/SHOULD)*LOSS

• coinsurance requirement is 80%

• when given market value of dwelling, take 80% of it first to get SHOULD

Mortgage Clause

mortgagee has right to collect when damages are made to property, right to collect even if insured loses right to recovery

PAF (Personal Articles Floater)

itemizes (def: list in detail) and insures moveable personal property on a scheduled basis, protects high-value items (furs, jewelry, fine arts, cameras)

• ex: instead of having $1500 coverage for jewelry, PAF can make it $20k

• scheduled means item is removed from sublimits and covered at its full value (by scheduling it at full value amount)

Scheduled Personal Property Endorsement

identical to PAF EXCEPT it is attached to HO policy whereas PAF is a separate policy

• applies to anywhere in the world (same for PAF)

Difference of HO and DP

HO includes coverage for personal liability and personal property (private homes)

DP covers the dwelling, contents, or both (for landlords)

DP ABC’s

• A- dwelling

• B- other structures

• C- personal property (policy owner’s personal property)

• D- rental value (applied if ABC are destroyed, pays out lost rental income while property is being repaired, income protection for landlords)

• E- loss of use aka additional living expense

DP (Dwelling Coverage) does NOT cover:

theft or liability unless added by an endorsement

• broad theft coverage

DP-1 Basic Form perils:

fire, lightning, internal explosions + extended coverage (WHARVES) + VMM (must be purchased) *ec’s and VMM are additional charge

DP-2 Broad Form perils:

basic perils + ec + VMM + B.B BICE-GOLF

DP-3 Special Form perils:

all risks except those excluded

Exclusions for DP and HO: WOPER

Water damage (flood, tidal waves, sewage backup)

Ordinance (law)

Power failure

Earth movement (subsidence)

Rebellion (war)

FAIR Plan

provides insurance to homeowners who cannot get insurance in voluntary market (i.e. area may be too hazardous); equivalent to basic HO policy, cannot purchase all-risk coverage

MUST:

• must be in designated area

• been turned down for coverage

• be an insurable risk

CEA

California Earthquake Authority, under commissioner jurisdiction and provides protection from earthquake loss

• CA requirement: must be offered by companies selling HO’s/DP’s in CA

2 other policies that cover earthquake

1. inland marine

2. auto (OTC)

Umbrella Policy aka Catastrophe Insurance

provides excess liability protection beyond the underlying home and auto policies, after self insured retention is paid (expands policy as well for situations outside current policy terms)

• increases limit amounts significantly

Excess Liability Policy

provides excess home and auto liability only; increases coverage limits only (does not expand policy)

Required Primary Limits?

limits insured is required to maintain for home and auto liability before insurer will pay, if not maintained then primary limits act as deductible

Boat Owners Policy Coverages:

physical damage

liability

medical payments

uninsured boater

• does not include protection and indemnity (P&I: liability insurance for maritime risks associated with operation of the vessel)

Boat Owners Policy

• most similar to auto policy

• covers non-commercial use i.e. pleasure (ex: unofficial race or contest)

• does not cover carrying passengers or cargo for a fee (business usage)

Yacht Policy Coverages:

hull (physical damage)

trailer

P&I (liability and workers comp)

• yacht policies structured more like traditional ocean marine policies

Yacht Policy Sue and Labor Clause

requires insured to take all steps to make sure property is protected from further damage, insurer will cover expenses incurred by the insured doing so