Today s Lecture 20 Homeowners Insurance Section I Property Coverages Limit Coverage A Dwelling 100 000 Coverage B Other Structures 10 000 Coverage C Personal Property 50 000 Coverage D Loss of Use Actual Loss Section II Liability Coverages Coverage E Personal Liability 100 000 Coverage F Medical Payments 1 000 to Others Deductible Policy Deductible for Section I 250 This deductible applies only once to each loss Apply deductible first then policy limits Example If 60 000 of your personal property is stolen calculate the loss as follows Loss 60 000 Deductible 250 Loss less deductible 59 750 Policy limit 50 000 Covered loss 50 000 Definitions Insured means you and residents of your household who are 1 Your relatives 2 Other persons under the age of 21 and in the care of any person named above Insuring Clause Coverages A and B Open perils Covers all risks subject to limitations and exclusions Coverage C Named perils Section I Loss Settlement Page 676 Actual cash value not to exceed cost of repair or replacement Personal Property Awnings carpeting household appliances outdoor antennas and outdoor equipment whether or not attached to buildings Structures that are not buildings Section I Loss Settlement Page 676 Replacement Cost subject to 80 coinsurance clause Buildings under coverages A and B Homeowners Example 1 A fire causes damage to your house and your furniture The amount of damages are Replacement Cost ACV House 20 000 15 000 Furniture 6 000 3 000 How much will your Homeowners Policy pay Assume the replacement cost of the entire house is less than 125 000 Answers A B C D E 18 000 21 000 23 000 26 000 None of the above Examples of Coverage A and B Exclusions Freezing of plumbing while dwelling is unoccupied unless you have used reasonable care to maintain heat Vandalism and malicious mischief to dwelling vacant more than 30 days Smog rust or other corrosion mold wet or dry rot Birds vermin rodents or insects Animals owned or kept by an insured Homeowners Example 2 You travel to China for six weeks When you return you find that your home has been vandalized by spray paint on the walls It costs 20 000 to repair the damage How much will your policy pay A 0 B 19 750 C 20 000 D None of the above Coverage C Personal Property 16 Named Perils Pages 673 674 plus Collapse Page 671 Examples of Covered Perils Fire Windstorm or hail Vehicles Vandalism and malicious mischief Coverage C Covered Perils Continued Theft unless Committed by an insured If in dwelling under construction From area rented to others Property at other residence if not currently living there except for a student as long as the student has been there any time within the 45 days prior to the loss Homeowners Example 3 While your son is home for Thanksgiving break someone steals his laptop computer from his dorm room The computer costs 2000 to replace It had an Actual Cash Value of 750 How much will your policy pay A 0 B 500 C 750 D 1750 E None of the above Special Limits on Personal Property Page 668 10 5000 on property usually located at an insured s residence other than residence premises 200 on money gold silver etc 1000 on securities tickets stamps 1000 on watercraft 1000 on loss by theft of jewelry watches furs precious and semi precious stones 2000 on loss by theft of firearms Special Limits Continued 2500 on silverware 2500 on property used in business while on residence premises 250 on property used in business while away from the residence premises Homeowners Example 4 Your fishing boat is destroyed in a fire The boat costs 5000 to replace It had an Actual Cash Value of 2000 How much will your policy pay A 0 B 750 C 1000 D 1750 E None of the above Examples of Property Not Covered Under Section C Page 669 Animals birds fish Motor vehicles Aircraft Homeowners Example 5 Someone steals your prize rare breed rabbit It costs 1500 to replace your rabbit The rabbit had an Actual Cash Value of 500 How much will your policy pay A 0 B 250 C 500 D 1250 E None of the above Coverage D Loss of Use If a covered loss renders the residence premises unfit to live in policy covers Additional living expenses or Fair rental value This is paid for the shortest time necessary to repair of replace damage or until permanent relocation Examples of Additional Coverages Pages 670 672 Debris removal could increase limit of liability by 5 Trees Shrubs Plants and Lawns Covered only for Fire or lightning Explosion Riot or civil commotion Aircraft Vehicles not owned or operated by resident Vandalism or malicious mischief Theft 5 limit in total no more than 500 per item Credit Card Fund Transfer Card Forgery and Counterfeit Money 500 Limit No Deductible Additional Section I Exclusions Pages 674 675 Ordinance or law Earth movement Water Damage Power failure Neglect War Nuclear hazard Intentional loss