o Loss of Use If the house burns down you also lose TEST NUMBER 2 Potential Exposures of Home Owners or Renters o Damage to destruction of removal of Real property A term for buildings Personal property ability to use the house Additional Living Expenses Extra Expenses Lost rent or rental values o Personal Liability People getting hurt in our house Characteristics of Homeowners Insurance o Package Policy Property First Party Coverage insured Liability Third Party Coverage anyone who sues for negligence against insured Includes loss of use coverage I can write a homeowners policy on up to four units as long as one of the units is occupied by the owner o Eligibility Rules Focus is on owner occupied property Private Residential purposes I have to live in it Limited Business Small business may allow for having private homeowners insurance One additional family Grandma and or Grandpa living in the home No more than 2 roomers boarders Living close to university renting out to a couple students Section 1 Property Section 2 Liability o Deductible for Property Losses Complicated in Florida because of hurricanes Purposes Eliminate small claims Increase loss control Effect Reduction of Premium 2 types Wind Percentage of Coverage A 2 5 OF THE BUILDING AMOUNT in florida o Very different in Florida than elsewhere o Includes hail o Named Storms Some apply only to named storms Tropical depressions and hurricanes o Applies per occurrence Aggregate created because of that now its per occurrence but only applied once during the calendar year hurricane season AOP All other perils o A dollar amount deductible Select the highest deductible you can bear Persons Insured o Named insured and spouse If a resident Marriage only endorsement for other o Family Members resident relatives o Under 21 care of the insured foster kids foreign exchange students o Under 24 full time student away from home still covered I am still covered o Any person legally responsible dogs Homeowners forms o HO 3 Section 1 Cov A Dwelling o Replacement Cost Cov B Other Structure o Separated by clear space o Specifically excludes land dirt o Replacement Cost Recovery an exception from the indemnification o Penalty for failure to insure to value coinsurance penalty 80 of replacement cost of Cov A o Additional coverages include debris removal reasonable repairs Cov C Personal Property o Unscheduled Personal Property Some property subject to limit Special limits o Guns and that crap have special limits o Absolute limits Boats in this section are only paying 1500 no matter the price of the boat o Some endorsements available Some property Excluded o Exclusions Fish Motor Vehicles Exception to the exclusion for vehicles that are used to operate the land john deere o Contents Broad definition of covered property Owned or used by an insured ACTUAL CASH VALUE RECOVERY Replacement Cost Depreciation Can be endorsed for replacement cost Covers property off premises Covers property worldwide Cov D Loss of Use o Result of A B and C o Pays on basis of actual loss sustained for Additional living expenses Lost rent and lost rental value Prohibited use max two weeks Property Coverage Relationships A 100 200000 B 10 of A 20000 C 50 of A 100000 70 if endorsed for replacement costs D 30 60000 Perils Named v Open Perils o No coverage for flood ever under homeowners HO 2 Broad Form Named perils building and contents Ho 3 Open perils on COV A B D Same as HO 2 for Cov C HO 4 Tenants form Nothing for A or B Same as HO 2 for coverages C and D HO 5 comprehensive form Open perils replacement cost on all coverages HO 6 Condominium Form Nothing for A or B but covers owners imporovements and betterments Same as HO 2 for C and D HO 8 Modified form For property not eligible for replacement Actual cash value recovery on all Fewer perils than HO 2 limited theft cost coverages coverages Section 2 Cov E Personal Liability Cov F Medical Payments o Property Section Exclusions Ordinance or Law The extra cost to build the house more expensive because older homes building codes were more lax goes to insured however you can buy an endorsement Earth Movement Earthquake Water Damage Power Failure Neglect Intentional Vacant more than 60 days o Property Section Conditions Duties after loss Notice of loss o Reasonable time passing Cooperation with insurer Proof of loss Mortgage Clause Pay premium if insured does not Sign proof of loss Subrogation rights assigned o More Conditions Loss settlement co insurance Loss to a pair or set Other insurance or service agreement Jewelry on separate form can collect on both Abandonment of property Not allowed to abandon your property Concealment or fraud Before or after the loss Criminal penalties Liberalization clause screens Cancelation Changing something adding coverage for Policy terminated before expiration non payment of premium or days of notice requiring them to change something not up to code Nonrenewal Assignment No actual problem but they re pulling out of your contract they re not going to renew Usually because of a bigger issue If you sell a house you can not give the insurance with it o Building premium Rate x Exposure Rate Year type of construction o Older more expensive o Wood more expensive Applicable building code o Some buildings cost more to make Occupancy residential o Living above a restaurant Protection district 1 10 o How close I am to the fire department o 1 is good 10 sucks Exposure to CAT o Home on coast more expensive Square Footage RC Guide o Programs that show you how much the replacement cost is Potential credits o Newer home o Protective devices Fire extinguisher alarm etc o Home car discount If you have both with same company get discount Underwriting judgment o Loss exchange report Like car facts for a house o Credit Report pay history Quantitative data claim based on previous experience UNIT 2 Liability Section o Insuring agreement Pay adjustments for Bodily injury and property damage o Personal injury upon request libel slander defamation of character etc Provide a defense o Broad Definition of Insured o Insured premises Named residence Residence acquired Garage or Storage Unit Motel Hotel Vacant land Cemetery burial plots Occasional rentals reception hall o Coverage E Personal Liability 100 000 minimum personal activities o Coverage F Medical Payments to OTHERS 1 000 volunteer up to accident policy On premises activities or animals yours and others o Additional Coverages Defense Expenses first aid Damage to
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