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30 Cards in this Set

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Misc vehicle coverage

Personal auto policy generally covers private passenger autos w/ 4 wheels but motorhome is generally not covered, need to have an endorsement.




Loss exposures of motor home and recreational trailers differ from automobile exposures in nature, frequency and severity. Creates exposures common to residences such as fire and explosion. Collision damage tends to be more frequent per miles driven than for personal auto. Camping vehicles can have greater exposure to flood or windstorm damage than autos.

Motor homes and recreational trailers pt.2

Miscellaneous type vehicle endorsement is added to the PAP and has to be used with a Misc type vehicle amendment to cover motor homes. Provides liability, medical, uninsured motorist and property damage coverage. No coverage provided when the motor home is rented to or used by another person (except for liability coverage up to the state financial responsibility limit, e.x. insured lends motorhome to friend that crashes into a building, that wouldn't be covered under insured's PAP b/c insured is not the driver). No coverage when motor home is acquired fraudulently.




Misc Type Vehicle Endorsement is one way to manage financial consequences of damage to a motor home.

Motor homes and recreational trailers pt.3

Trailer/camper body coverage endorsement. Provides coverage for travel trailers or campers. No coverage for clothing, luggage and business suppliers or equipment.




Many insurers that specialize in recreational vehicle insurance use their own custom forms as opposed to ISO forms. Custom form coverage may be broader than standard ISO coverage. Custom form may include lay-up provision (states that coverage will be suspended for certain times during the year, mainly intended for vehicles in storage part of the year (boat) could substatially reduce premium).

Motorcycles & other two-wheeled vehicles

Bodily injury exposures for motorcycles are more severe than for automobiles. Use of off-road vehicles by unlicensed, often youthful and inexperienced operators increases the likelihood of accidents. Motorcycles offer less protection.




Property damage exposures are typically less with motorcycles (for liability they cause less damage and for first party coverage they are less expensive than cars). Deductible or retention may be used to manage exposures with smaller vehicles.




Property damage exposures for 2-wheeled vehicles may be less significant than liability loss exposures for these vehicles.




Minibikes are specifically excluded from coverage in the liability section of the PAP.

Motorcycles & other two-wheeled vehicles pt.2

Misc type vehicle endorsement: revises liability exclusion in the PAP relating to vehicles with fewer than four wheels. Passenger hazard exclusion can also be activated (optional, covers medical payments of passengers but would exclude liability coverage for passengers). Can also amend medical payments coverage by allowing coverage for injury resulting from use of vehicle with fewer than four wheels. Covers motorcycles, motorcycles w/ sidecars, trail bikes, minibikes, mopeds etc.

Golf carts

ISO homeowners 2000 policies provide liability coverage for motorized golf carts designed to travel no more than 25 mph and used to: Play golf or travel from a parking area to access another part of the golf facility. Travel within a private residential community.




Coverage for property damage can be added. Owned motorized golf cart physical loss coverage endorsement to the HO policy or misc type vehicle endorsement. Owned Motorized Golf Cart Physical Loss Coverage Endorsement to HO policy would cover liability.

Antique and classic automobile

Antique automobiles are usually defined as those that are over 25yrs old, they may be more or less old and defined by their unusual styling and features. Classic cars have special value because of unusual styling or mechanical features. Since these cars typically appreciate in value the traditional definition of ACV would not provide an adequate amount of coverage for physical damage (vehicle's current value may exceed its original cost).




Liability coverage does not present an issue and is readily available. Rate credits may be given to lower premium for liability coverage on antique cars driven only in parades and other special events. Problems can arise in securing physical damage coverage because these cars generally appreciate in value.

Other recreational vehicles

Incidental low power recreational motor vehicle endorsement can be used to extend liability and medical payments coverage. Coverage for vehicles that cannot travel more than 15mph. Includes ATVs, dune buggies, go-carts and children's play cars. Vehicles typically don't cause a lot of damage. Endorsement to homeowner's policy.




A snowmobile can be covered under an ISO HO Snowmobile endorsement of an ISO Snowmobile endorsement to a PAP but snowmobiles are not covered under the Misc Vehicle Type Endorsement. The ISO owned Snowmobile endorsement to PAP provides both liability and physical damage coverage. It contains exclusions for snowmobiles subject to motor vehicle registration and for the use of snowmobiles for prearranged racing contests or business purposes. An unendorsed HO policy provides liability coverage for snowmobiles operated on the insured premises, but not away from the insured premises.

ISO mobilehome endorsement (mobile home coverage)

Mobile home can be moved but is typically only moved every few years.




Mobile home owner is exposed to possible loss by collision or upset of a unit being transported. ISO mobilehome policy is created by attaching the Mobilehome Endorsement to an ISO HO policy. Specialty insurers offer mobile home policies.




ISO mobile home policy is created by attaching mobilehome endorsement to existing HO-2, 3, or 4. Mobilehome must be designed for year-round living and also be transportable. Residence premises are defined as the mobile home and other structures located on land.

ISO mobilehome pt.2

ISO mobilehome endorsement modifies property coverages in section I of the HO policy.




Coverage A (dwelling) - applies to the mobile home and attached structures on the premises. Includes floor coverings, appliances, cabinets and materials on or next to premises (mobile homes typically have more built in furnishings than a dwelling so for mobile home there would be covered under Cov A). Also includes utility tanks on residence premises, dressers and cabinets, materials and supplies located on or nest to the residence premises and used to construct, alter or repair the mobile home (even if stolen would be covered under A).




Coverage B - applies to structures on the premises not attached to the mobile home (pool, storage shed). Limit maximum is 10% of Coverage A limit.

ISO mobilehome endorsement

Other modifications to section I. Coverage C - limit is usually lower on mobile home (40%) policies than HO policies (50%) (built-in accessories and built-in furniture are covered as part of the dwelling Cov A, that's why there;s less coverage for mobile home under coverage C than for a home on HO). Additional coverages - removes coverages for ordinance or law (there is an additional coverage issued under HO policy for this but it is not offered w/ mobilehome endorsement).




Liability loss exposure of mobilehomes is similar to other types of dwellings so the mobilehome endorsement does NOT modify section II - liability coverage of the HO policy.

ISO mobilehome endorsement pt.2

Mobilehome endorsement for property removed provides additional coverage if home is endangered and removal is necessary. Insurer will pay up to $500 for removal and return of mobile home itself. Mobile home must be endangered by a covered peril. E.x. mobile home in an area where rapid fire approaching, moving the home may result in damage to mobile home, if truck is pulling mobile home and crashes, this endorsement will cover the damage.

Specialty insurer's policies

The american association of insurance services has developed its own program.




In addition, several insurers specialized in insurance coverage for manufactured homes. Most of these insurers are independent filers. Liability coverage (section II) is typically the same as that provided in the insurer's standard homeowners policies.




Specialty insurers can often provide expertise in the unique loss exposures of mobile homes. Just like w/ HO policies getting mobilehome endorsement these specialty mobilehome policies can get their own endorsements.

Mobilehome endorsements (for specialty mobilehome policies)

Several endorsements are available for mobile home policies offered by specialty insurers.




Actual case value endorsement - limits insurer obligation to the least of: Actual cash value of the damage. Cost of repairing damage. Cost of replacing the damaged property with similar property. Applicable limit of coverage.

Mobilehome endorsements pt.2

Mobile home policy endorsements:




Transportation/permission to move endorsement - covers perils of transporting and storing mobile home for up to 30 days (if moved for any reason, 30days covers even 30days after mobile home dropped at destination).




Mobilehome lienholder's single interest endorsement - covers the lienholder for transportation exposures and any loss resulting from owner's embezzlement of the mobile home. E.x. insured makes small down payment and owes money to lienholder, insured takes mobilehome to different state and stops making payments, this endorsement covers the lienholder, some may require it.

Mobilehome endorsements pt.3

Mobile home endorsements:




Property removed increased limit endorsement - allows insured to increase the $500 limit for removing an endangered home.




Ordinance or law coverage endorsement - provides coverage if a governmental authority or law orders repair, alteration or removal of the mobile home or structures.

Loss exposures (watercraft coverage)

The ownership and use of watercraft creates loss exposures that fall into several categories: physical damage loss to watercraft. Medical expenses for injuries. Bodily injury and property damage liability.




Watercraft perils include those common on land, such as fire. Also include perils of the sea (boat sinking, getting hit by tidal wave).

ISO homeowners coverage forms

Limited coverage for watercraft under standard HO form: $1500 limit for watercraft property damage. Coverage provided on a named-perils basis (Cov C covers personal property on named perils basis). No coverage for perils of the sea. Windstorm coverage only applies when the watercraft is inside a fully enclosed building. Theft coverage does not apply when watercraft away from the residence premises.




HO-3 policy provides liability coverage for sailboats under 26ft and non-powered boats.




Coverage for watercraft under the HO policy is not adequate for many of the needs of boat owners.




The watercraft joint ownership endorsement provides coverage if the watercraft is owned by two or more insureds who do not reside together.

Personal auto policy

Personal auto policy does not provide physical damage or liability coverage for watercraft, motors or equipment. Physical damage to a boat trailer is covered if trailer is described on Declarations page. Liability coverage applies to a boat trailer whether or not the trailer is described on the Declarations page.

Small boat policies

Small boat policies are designed to cover boats up to 26ft in length (jet skis, waverunners and sea-doos do not qualify).




Property coverage: Includes damage to boat, motor, equipment and trailer. Typically written on ACV basis and contains deductible. Typically open-perils (may be named-perils but most are open). Covered losses include collision, theft of the boat's motor or equipment and lightning and wind damage, also perils of the sea.

Small boat policies pt.2

Liability coverage: Typically covers bodily injury, loss of life and property damage to third parties. Medical payments coverage is included for an insured person who sustains injury while in, upon, boarding or leaving the boat.




E.x. - small boat (less than 26ft) collides with a dock. Small boat policy would cover injuries of a passenger, damage to the dock and medical payment to a person on the dock injured.




Weathering (deterioration due to weather over time) and damage from extremes of temperature are excluded.

Boatowners and yacht policies

Individuals owning larger boats will normally need a boatowner's or yacht policy.




Boatowners and yacht policies usually contain several warranties, a warranty is a written or oral statement in a contract that certain facts are true (some requirements must be satisfied for insured to purchase these policies): Insured has to agree that boat will not be hired or chartered out (for personal use only, not business). The boat is in seaworthy condition. The boat will not be in operation during any lay-up provision period. Insured will not operate the boat outside the navigational limits specified in the policy.

Boatowners and yacht policies pt.2

The policies usually cover: Physical damage, either on an open-perils or named-perils basis (can pay extra for open perils). Yachts are typically insured on an agreed value basis after a professional survey. Medical payments - bodily-injury-related expenses for the insured and others.




Boatowners and yacht policies typically cover physical damage to vessels, including their machinery and fuel through Hull insurance.




Protection and indemnity insurance covers against liability for bodily injury and property damage arising from the ownership, maintenance or use of the insured boat. The yacht policy's protection and indemnity coverage covers shipowners against various liability claims due to operating the insured vessel, this policy covers a paid captain and crew, among other individuals.




The Jones act is a federal statute that permits injured members of a vessel's crew to sue their employer for damages due to the employer's negligence.

Boatowners and yacht policies pt.3

Typical property loss exclusions: Wear and tear, weathering and damage from animal or marine life. Mechanical breakdown. Freezing and thawing of ice. Loss during any official race, except for sailboat racing in some policies. Intentional loss. War, nuclear hazard and radioactive contamination.

Boatowners and yacht policies pt.4

Typical liability loss exclusions: Losses occurring from illegal activities. Losses related to rental or charter of the watercraft. Use of the watercraft for racing. Discharge of pollutants. Damage resulting from transportation of the boat on land (driving boat from one location to another). Losses covered by workers compensation.

Personal umbrella policy

An umbrella policy is designed to provide bodily and personal injury coverage and property damage (includes loss of use) liability coverage. Applies to catastrophic claims or judgments. Provides additional liability limits over any underlying insurance policies (umbrella insurer is excess over any other insurance whether that other insurance is collectible or not). Personal injury includes assault and battery not intentionally committed and wrongful entry or eviction. HO policy does not cover libel or slander by PLUP does.




The amount of personal umbrella coverage purchased typically from $1,000,000 - $10,000,000.




Policy provides coverage enev if underlying policies are with different insurers.

Drop down coverage

The personal umbrella policy also typically provides drop-down coverage which is broader than the underlying coverage.




If underlying policy doesn't apply to a loss and the loss is not excluded by umbrella coverage, the umbrella coverage covers the entire loss, e.x. someone slanders the insured, not covered by HO but is normally covered by umbrella policy through drop down coverage. There is not a deductible under umbrella policy however there is self-insured retention which is similar. Coverage is reduced by a self-insured retention, typically between $250-$10,000. Self-insured retention does not apply when underlying coverage is present (SIR only applies when the loss is not covered by an existing underlying policy). SIR does not apply when underlying insurance is present, even if underlying insurance is uncollectable.

Insuring agreement

The policy covers bodily injury and property damage, as well as personal injury for which an insured becomes legally liable. Covers legal defense costs not payable by the underlying insurance policies. Some states require the insurer to offer the insured the option to extend the policy, through endorsement, to cover UM and UIM protection.




Professional liability is usually excluded.




The policy covers the named insured, resident relatives and usually persons using vehicles. Usually before insured is eligible to purchase umbrella policy, they have to increase limits on underlying coverage.

Exclusions

Typical exclusions: Intentional injury. Business property and profession liability. Aircraft, watercraft and recreational vehicles. Transmission of communicable diseases. Directors and officers of for-profit organization liability (directors or officers of a not-for-profit organization are covered). Damage to insured's property. Obligations for which insured is legally liable under a workers compensation law.

Conditions

Conditions in the personal umbrella policy: Insured must maintain underlying coverage by paying premium (if underlying coverage not maintained but PLUP is maintained, the policy will pay only what would have been covered if the underlying policy was in effect). Insured must give the insurer written notice of loss as soon as practicable. Umbrella policy is excess over any other insurance, whether collectible or not. Policy territory is worldwide.