POLICY NUMBER:
EAF781722-16
COMMON POLICY DECLARATIONS
PLACED BY RISK PLACEMENT SERVICES, INC.
AXIS SURPLUS INSURANCE COMPANY
111 SOUTH WACKER DRIVE, SUITE 3500
CHICAGO, IL 60606
Montana Association of Counties
2715 Skyway Drive
Helena, MT 59602
POLICY PERIOD: FROM
July 01, 2016
TO
TIME AT YOUR MAILING ADDRESS SHOWN ABOVE.
RISK PLACEMENT SERVICES, INC.
2400 LAKEVIEW PARKWAY, SUITE 675
GEORGIA 400 BUSINESS CENTER
ALPHARETTA, GA 30009
NAMED INSURED:
MAILING ADDRESS:
July 01, 2017
AT 12:01 A.M. STANDARD
BUSINESS DESCRIPTION Municipality
IN RETURN FOR THE PAYMENT OF THE PREMIUM, AND SUBJECT TO ALL THE TERMS OF THIS
POLICY, WE AGREE WITH YOU TO PROVIDE THE INSURANCE AS STATED IN THIS POLICY.
THIS POLICY CONSISTS OF THE FOLLOWING COVERAGE PARTS FOR WHICH A PREMIUM IS
INDICATED. THIS PREMIUM MAY BE SUBJECT TO ADJUSTMENT.
PREMIUM
BOILER AND MACHINERY COVERAGE PART
$
CAPITAL ASSETS PROGRAM (OUTPUT POLICY) COVERAGE PART
$
COMMERCIAL AUTOMOBILE COVERAGE PART
$
COMMERCIAL GENERAL LIABILITY COVERAGE PART
$
COMMERCIAL INLAND MARINE COVERAGE PART
$
COMMERCIAL PROPERTY COVERAGE PART
$ 55,560
CRIME AND FIDELITY COVERAGE PART
$
EMPLOYMENT-RELATED PRACTICES LIABILITY COVERAGE PART
$
FARM COVERAGE PART
This is a non-admitted carrier. $
LIQUOR LIABILITY COVERAGE PART
It is the responsibility of RPS to $
arrange for the filing and paying $
POLLUTION LIABILITY COVERAGE PART
PROFESSIONAL LIABILITY COVERAGE PART of surplus lines tax.
$
INSPECTION FEE
$
INSURED PURCHASED TRIA TERRORISM COVERAGE NO  YES
$
TOTAL: $ 55,560
Premium shown is payable:
$
55,560
at inception.
Premium
MT Surplus Lines Tax
Total Charges
:
:
:
$
$
$
55,560.00
1,527.90
57,087.90
To Report a Loss
• Dial toll-free #1 (844)777-8323 or visit our
• Website: https://my.rpsins.com/claimsfnol
• Contact Insurer directly (see policy section)
ES 018 0607
Includes copyrighted material of Insurance Services Office, Inc.,
with its permission.
RPSATLA/SC/2016.08.31
RPSATLA/SC/2015.04.08/PR
Page 1 of 2

FORMS APPLICABLE TO ALL COVERAGE PARTS (SHOW NUMBERS):
02. Notice to Policyholder – ES 115 0106
03. Policyholder Notice Montana – SLN-MT (09-06)
04. State Fraud Statements – LI FS 001 07 15
05. Brokers Manuscript Form
06. Named Insured Schedule – Endorsement A – ES 109 0107
07. Schedule Limit of Liability – Endorsement B – ES 138 0106
08. Minimum Earned Premium Clause – Percentage – Endorsement C – ES 106 0106
09. Commercial Property Exclusion Endorsement – Endorsement D – ES 133 0106
10. Total Exclusion – Electronic Property And Virus – Endorsement E – ES 033 0106
11. Mold, Fungi, Wet Or Dry Rot, And Bacteria Exclusion Endorsement – Endorsement F – ES 084 0106
12. Nuclear, Chemical And Biological Exclusion Endorsement – Endorsement G – ES 116 0608
13. Terrorism Exclusion Endorsement – Endorsement H – AXIS TERROR EXCLUSION 01 06
14. Exclusion of Certified Acts of Terrorism – IL 09 53 01 15
15. Service of Suit Clause – Endorsement I – SOS-CW (08-03)
16. AXIS Surplus Signature Page – ES 020 0607
17. Claim Notice – ES 036 0512
NOTICE: This coverage is issued by an unauthorized insurer
that is an eligible surplus lines insurer. If this insurer
becomes insolvent, there is no coverage by the Montana
Insurance Guaranty association under the Montana Insurance
Guaranty Association Act.
___Joel D. Cavaness_________
Printed Name of Surplus Lines
Insurance Producer
____ 931504_________
Montana License Number
_____________________________________________
Signature of Surplus Lines Insurance Producer
Countersigned:
By:
(Date)
(Authorized Representative)
NOTE
OFFICERS' FACSIMILE SIGNATURES MAY BE INSERTED HERE, ON THE POLICY COVER OR
ELSEWHERE AT THE COMPANY’S OPTION.
Page 2 of 2
ES 018 0607
Includes copyrighted material of Insurance Services Office, Inc.,
with its permission.

NOTICE TO POLICYHOLDER
This policy is composed of various forms explaining the insurance coverage provided. It may also include
one or more endorsements. Endorsements are documents that change the policy. Endorsements may
provide additional coverage to the policy. Endorsements can also restrict or remove coverage provided in
the policy. THE POLICY SHOULD BE READ CAREFULLY TO DETERMINE WHAT IS AND WHAT IS
NOT COVERED.
As the context may require, the words “you”, “your”, “Insured”, and “the Insured” refer to the Named
Insured shown on the Declarations Page. The words “we”, “us”, “our”, “Company”, “the Company”, and
“this Company” refer to the Company providing this insurance.
ES 115 0106
Named Insured
Montana Association of Counties
Policy Number
EAF781722-16
Policy Period
07/01/2016 to 07/01/2017
Issued by:
AXIS Surplus Insurance Company
POLICYHOLDER NOTICE
MONTANA
Issued in an unauthorized insurer under The Surplus Lines Insurance Law, under surplus lines insurance
producer license No.
.
NOT Covered by the property and casualty guaranty fund of this state if the unauthorized insurer
becomes insolvent.
The surplus lines producer shall properly fill in and sign the endorsement.
SLN-MT (09-06)
STATE FRAUD STATEMENTS
Applicable in Alabama
Alabama Fraud Statement
“Any person who knowingly presents a false or fraudulent claim for payment of a loss or benefit or
who knowingly presents false information in an application for insurance is guilty of a crime and
may be subject to restitution fines or confinement in prison or any combination thereof.”
Applicable in Arkansas, Louisiana, Rhode Island, and West Virginia
Arkansas, Louisiana, Rhode Island, and West Virginia Fraud Statement
“Any person who knowingly presents a false or fraudulent claim for payment of a loss or benefit or
knowingly presents false information in an application for insurance is guilty of a crime and may
be subject to fines and confinement in prison.”
Applicable in Colorado
Colorado Fraud Statement
“It is unlawful to knowingly provide false, incomplete, or misleading facts or information to an
insurance company for the purpose of defrauding or attempting to defraud the company.
Penalties may include imprisonment, fines, denial of insurance and civil damages. Any insurance
company or agent of an insurance company who knowingly provides false, incomplete, or
misleading facts or information to a policyholder or claimant for the purpose of defrauding or
attempting to defraud the policyholder or claimant with regard to a settlement or award payable
from insurance proceeds shall be reported to the Colorado division of insurance within the
department of regulatory agencies.”
Applicable in District of Columbia
District of Columbia Fraud Statement
“Warning: It is a crime to provide false or misleading information to an insurer for the purpose of
defrauding the insurer or any other person. Penalties include imprisonment and/or fines. In
addition, an insurer may deny insurance benefits if false information materially related to a claim
was provided by the applicant.”
Applicable in Florida
Florida Fraud Statement
“Any person who knowingly and with intent to injure, defraud, or deceive any insurer files a
statement of claim or an application containing any false, incomplete or misleading information is
guilty of a felony of the third degree.”
Applicable in Kansas
Kansas Fraud Statement
“A “fraudulent insurance act” means an act committed by any person who, knowingly and with
intent to defraud, presents, causes to be presented or prepares with knowledge or belief that it
will be presented to or by an insurer, purported insurer, broker or any agent thereof, any written,
electronic, electronic impulse, facsimile, magnetic, oral, or telephonic communication or
statement as part of, or in support of, an application for the issuance of, or the rating of an
insurance policy for personal or commercial insurance, or a claim for payment or other benefit
pursuant to an insurance policy for commercial or personal insurance which such person knows
LI-FS 001 07 15
Page 1 of 4
to contain materially false information concerning any fact material thereto; or conceals, for the
purpose of misleading, information concerning any fact material thereto.”
Applicable in Kentucky
Kentucky Fraud Statement
“Any person who knowingly and with intent to defraud any insurance company or other person
files an application for insurance containing any materially false information, or conceals, for the
purpose of misleading, information concerning any fact material thereto commits a fraudulent
insurance act, which is a crime.”
Applicable in Maine
Maine Fraud Statement
“It is a crime to knowingly provide false, incomplete or misleading information to an insurance
company for the purpose of defrauding the company. Penalties may include imprisonment, fines
or a denial of insurance benefits.”
Applicable in Maryland
Maryland Fraud Statement
"Any person who knowingly or willfully presents a false or fraudulent claim for payment of a loss
or benefit or who knowingly or willfully presents false information in an application for insurance is
guilty of a crime and may be subject to fines and confinement in prison."
Applicable in New Jersey
New Jersey Fraud Statement
“Any person who includes any false or misleading information on an application for an insurance
policy is subject to criminal and civil penalties.”
Applicable in New Mexico
New Mexico Fraud Statement
“Any person who knowingly presents a false or fraudulent claim for payment of a loss or benefit or
knowingly presents false information in an application for insurance is guilty of a crime and may
be subject to civil fines and criminal penalties.”
Applicable in New York
New York Fraud Statement
“Any person who knowingly and with intent to defraud any insurance company or other person
files an application for insurance or statement of claim containing any materially false information,
or conceals for the purpose of misleading, information concerning any fact material thereto,
commits a fraudulent insurance act, which is a crime, and shall also be subject to a civil penalty
not to exceed five thousand dollars and the stated value of the claim for each such violation.”
Applicable in Ohio
Ohio Fraud Statement
“Any person who, with intent to defraud or knowing that he is facilitating a fraud against an
insurer, submits an application or files a claim containing a false or deceptive statement is guilty
of insurance fraud.”
LI-FS 001 07 15
Page 2 of 4
Applicable in Oklahoma
Oklahoma Fraud Statement
“WARNING: Any person who knowingly, and with intent to injure, defraud or deceive any insurer,
makes any claim for proceeds of an insurance policy containing any false, incomplete or
misleading information is guilty of a felony.”
Applicable in Oregon
Oregon Fraud Statement
Any person who knowingly presents a false or fraudulent claim for payment of a loss or benefit or
knowingly presents materially false information in an application for insurance may be guilty of a
crime and may be subject to fines and confinement in prison.
In order for us to deny a claim on the basis of misstatements, misrepresentations, omissions or
concealments on your part, we must show that:
A. The misinformation is material to the content of the policy;
B. We relied upon the misinformation; and
C. The information was either:
1. Material to the risk assumed by us; or
2. Provided fraudulently.
For remedies other than the denial of a claim, misstatements, misrepresentations, omissions or
concealments on your part must either be fraudulent or material to our interests.
With regard to fire insurance, in order to trigger the right to remedy, material misrepresentations
must be willful or intentional.
Misstatements, misrepresentations, omissions or concealments on your part are not fraudulent
unless they are made with the intent to knowingly defraud.
Applicable in Pennsylvania
Pennsylvania Fraud Statement
“Any person who knowingly and with intent to defraud any insurance company or other person
files an application for insurance or statement of claim containing any materially false information
or conceals for the purpose of misleading, information concerning any fact material thereto
commits a fraudulent insurance act, which is a crime and subjects such person to criminal and
civil penalties.”
Applicable in Puerto Rico
Puerto Rico Fraud Statement
LI-FS 001 07 15
Page 3 of 4
Any person who knowingly and with the intention of defrauding presents false information in an
insurance application, or presents, helps, or causes the presentation of a fraudulent claim for the
payment of a loss or any other benefit, or presents more than one claim for the same damage or
loss, shall incur a felony and, upon conviction, shall be sanctioned for each violation with the
penalty of a fine of not less than five thousand dollars ($5,000) and not more than ten thousand
dollars ($10,000), or a fixed term of imprisonment for three (3) years, or both penalties. Should
aggravating circumstances be present, the penalty thus established may be increased to a
maximum of five (5) years, if extenuating circumstances are present, it may be reduced to a
minimum of two (2) years.
Applicable in Tennessee, Virginia and Washington
Tennessee, Virginia and Washington Fraud Statement
“It is a crime to knowingly provide false, incomplete or misleading information to an insurance
company for the purpose of defrauding the company. Penalties include imprisonment, fines and
denial of insurance benefits.”
LI-FS 001 07 15
Page 4 of 4
Policy Section A
General Conditions
These conditions apply to all sections and forms of this policy unless specifically otherwise stated.
1.
Named Insured
The Named Insured stated on the declarations page and shall include all subsidiary, affiliated, related, or allied
companies, corporations, firms or organizations (as they now are or may hereafter be constituted) or persons
for which the Insured has the responsibility for placing insurance and for which more specific coverage does
not otherwise exist.
2.
Insurance Agreement
As respects those perils designated by an “X” below. This Policy insures against the following perils:
Earthquake
Earthquake Sprinkler Leakage
Flood
Flood in zones A and/or V.
Coverage is provided only for those perils specifically designated above by an “X”. No
Coverage is provided for those perils not so designated.
3.
Waiting Period for Time Element Coverages
If Time Element Insurance is provided, Coverage will begin after the following waiting periods:
Service Interruption:
All other Business Interruption losses:
4.
24 hours from time of loss
24 hours from time of loss
Deductible
Each Occurrence resulting in a claim for loss shall be adjusted separately and the Company’s liability shall be
limited to that amount by which the loss exceeds all applicable waiting periods for Time Element coverage
and the deductible amounts shown hereunder, up to the applicable Limit of Liability.
(a)
In respect of loss caused directly by the peril of Earthquake, as defined: $100,000
If two or more deductible amounts in this policy apply to a single loss, the total to be deducted shall not exceed
the largest applicable deductible.
5.
Limit of Liability
The Company’s liability for the cumulative total of adjusted net claims resulting from any one Occurrence
(including all costs, fees, charges and expenses) shall not exceed $25,000,000 part of $50,000,000.
Without increasing the Policy limit, it is agreed that:
(a)
Loss caused by the peril of Earthquake, as defined, is subject to an Annual Aggregate Limit of Twenty
Five Million Dollars part of Fifty Million Dollars ($25,000,000 part of $50,000,000).
The Maximum limit of liability for the peril of Earthquake in the Annual Aggregate is Twenty Five Million
Dollars ($25,000,00).
6.
Program Sublimits
Coverages
Newly Acquired
Section
A
Sublimit
$25,000
Demolition, Increased Cost of Construction, Building Laws or
Ordinances (Combined) all locations except locations built prior
to 1976
Demolition, Increased Cost of Construction, Building Laws or
Ordinances (Combined) all locations built prior to 1976
Service Interruption
Electronic Data Processing Hardware & Software
Electronic Data Processing Media
Accounts Receivables
Valuable Papers and Records
Errors & Omissions
Offsite Storage
Pollutant Cleanup
Underground Utilities
Business Interruption
Extra Expense
B
$5,000,000
B
$2,500,000
B
C
C
D
E
$1,000,000
$1,000,000
$500,000
$10,000
$10,000
$10,000
$10,000
$10,000 Per Occurrence
$1,000,000
$5,000,000
Included in Business
Interruption
Sublimit amounts are inclusive of all policy sections and deemed to be part of, and not in addition to the Limit
of Liability stated in Section A, General Conditions of the Policy.
7.
Automatic Coverage, New Acquisitions
Automatic Acquisition limits applicable to this Policy are as stated under Sublimits, Section A, General
Conditions.
This Policy automatically covers property similar in nature to that is declared on the Statement of Values and
insured herein at Policy inception. However, the limit(s) of liability as provided herein shall not be increased
by this extension.
Any property newly acquired or property installed or constructed during the Policy period shall be reported to
the Company within sixty (60) days and an additional premium will be paid by the Insured at rates to be
agreed. Coverage shall commence at the time and Location the Insured first acquires an insurable interest and
shall cease sixty (60) days from the date of such acquisition, unless accepted by the Insurer. This provision
shall not be construed to include any property in due course of Transit or at Locations otherwise more
specifically Insured. Failure to notify the Company within the time period prescribed will result in the
Miscellaneous Unnamed Location sublimit applying to the newly acquired or constructed property.
8.
Reporting and Premium Adjustment
The premium shall be adjusted at the effective date of the transaction and adjusted by the Company for all
additions and deletions.
It is understood that the Statement of Values filed with the Company represent 100% of the value of the
interests insured herein.
9.
Definitions
For the purpose of this Policy, the following terms, wherever used, shall be as hereafter defined.
(a)
Earthquake
The term Earthquake shall mean seismic activity, including earth movement, landslide, mudslide,
sinkhole, subsidence, volcanic eruption, or Tsunami, as defined herein.
All loss caused directly by Earthquake shall constitute a single claim hereunder; provided, if more than
one Earthquake shock shall occur within any period of one hundred and sixty eight (168) hours during
the term of this Policy, such Earthquake shall be deemed to be a single Earthquake within the meaning
thereof. The Company shall not be liable for any loss caused by Earthquake occurring before the
2
effective date and time of this Policy nor for any loss occurring after the expiration date and time of
this Policy.
In no event shall this Company be liable for any loss caused directly or indirectly by fire, explosion or
other excluded perils as defined herein.
(b)
Earthquake Sprinkler Leakage
The term Earthquake is defined as above in clause (a) and Sprinkler Leakage shall mean leakage or
discharge of water or other substance from an Automatic Sprinkler System from an Insured Location(s)
including collapse of a tank that is part of the system.
Automatic Sprinkler System is defined as:
1) Any automatic fire-protective or extinguishing system, including connected:
i)
Sprinklers and discharge nozzles;
ii)
Ducts, pipes, valves and fittings;
iii)
Tanks, their component parts and supports; and
iv)
Pumps and private fire protection mains
2)
(c)
When supplied from an automatic fire-protective system:
i)
Non-automatic fire-protective systems; and
ii)
Hydrants, standpipes and outlets.
Flood
The term Flood shall mean a condition of partial or complete inundation of normally dry land areas by
natural or man-made causes, due to surface water, waves, (excluding Tsunami as defined), tide or tidal
water, rainfall and/or resultant runoff including mudslides or mudflows which are caused by Flooding,
and the rising (including overflowing or breaking of boundaries) of lakes, ponds, reservoirs, rivers,
harbors, streams, or similar bodies of water all whether wind-driven or not.
All loss caused directly by Flood shall constitute a single claim hereunder; provided, if more than one
Flood shall occur within any period of seventy-two (72) hours during the term of this Policy, such Flood
shall be deemed to be a single Flood within the meaning thereof. The Company shall not be liable for
any loss caused by Flood occurring before the effective date and time of this Policy nor for any loss
occurring after the expiration date and time of this Policy.
In no event shall this Company be liable for any loss caused directly or indirectly by fire, explosion or
other excluded perils whether the same be caused by or attributable to Flood or otherwise.
(d)
Flood Zone A and/or V
Flood areas defined as Special Flood Hazard Areas (SFHA) within a 100 year flood plain as defined in the
most recent Flood Insurance Rate Map (FIRM) by the Federal Emergency Management Agency (FEMA),
which is, in whole or in part, located in Flood Zone A or V. Flood Zone A will include, but not be limited
to, all of the sub-classifications of AO, AH, AE, AR, A1 through A30 and A99, or any other subclassification with the A prefix or designation. Flood Zone V will include, but not be limited to, all of the
sub-classifications of VO, VH, VE, VR, V1 through V30 and V99, or any other sub-classification with the V
prefix or designation.
In no event shall this Company be liable for any loss caused directly or indirectly by fire, explosion or
other excluded perils whether the same be caused by or attributable to Flood or otherwise.
(e)
Tsunami – The term Tsunami shall mean a wave or series of waves caused by underwater earthquakes
and/or seismic activity, including, but not limited to, volcanic eruptions, landslides, earth movement,
mudslide, sinkhole, or subsidence.
3
In no event shall this Company be liable for any loss caused directly or indirectly by fire, explosion or
other excluded perils as defined herein.
(e)
Occurrence
An occurrence shall be defined as any one loss, disaster or casualty or series of losses, disasters or
casualties arising out of one event.
(f)
Insured Location(s)
The term Location shall mean all property, including groups of buildings and structures, at one site
which is surrounded by public streets, open waterways or open land, where such streets, waterways or
land are all at least fifty (50) feet wide. If bridges or tunnels connect properties at adjoining sites such
properties shall be considered as one Location.
The coverages under this Policy apply to an Insured Location unless otherwise provided.
An Insured Location(s) is a Location:
1) listed on the schedule or Statement of Values provided to the Company
2) covered as a Miscellaneous Unnamed Location
3) covered under the terms and conditions of the Automatic Acquisition Clause
10.
Cancellation
This Policy may be cancelled by the Insured by surrender thereof to the Company or by mailing to the Company
written notice stating when thereafter-such cancellation shall be effective. This Policy may be cancelled by the
Company by giving sixty (60) days notice of such cancellation, or in the event of non-payment of premium ten
(10) days notice by registered mail to the address shown in this Policy or last known address. The time of
surrender or the effective date of the cancellation stated in the notice shall become the end of the policy
period. Delivery of such written notice either by the Insured or by the Company shall be equivalent to mailing.
If the Insured cancels, earned premiums shall be computed in accordance with the customary short rate table
and procedure. If the Company cancels, earned premiums shall be computed pro rata. Premium adjustment
may be made at the time cancellation is effected and, if not then made, shall be made as soon as practicable
after cancellation becomes effective. The Company's check or the check of its representative mailed or
delivered as aforesaid shall be a sufficient tender of any refund of premium due to the Insured.
4
Policy Section B
Loss of Property
1.
Insured Property
This section of the Policy, and except as herein excluded, insures:
(a)
(b)
(c)
(d)
2.
All real and personal property of every kind and description as declared on the submitted Statement of
Values, being the property of the Insured.
All real and personal property of every kind and description, being the property of others in the care,
custody and control of the Insured or for which the Insured has assumed liability by contract.
All real and personal property of every kind and description, being the property of the Insured or
property of others in the care, custody and control of the Insured or for which the Insured has assumed
liability by contract while loaded for shipment and in transit.
Extensions, additions, renovations and refurbishing to insured property in the course of construction or
installation including such property while stored off-site, while in transit and while being worked upon
in connection with the project.
Excluded Property
This section of this policy does not insure:
(a)
Land or land value, and/or water;
(b)
golf courses and beaches;
(c)
motor vehicles fully licensed for and intended for regular highway use;
(d)
money, securities, evidences of debt or title, inscribed documents or records, blueprints, maps, plans,
surveys, mortgages, deeds, abstracts, manuscripts, books, drawings, sketches, films, linens, scale
models, photographs and photographic reproductions, and similar property;
(e)
aircraft; watercraft over 26 feet in length;
(f)
furs, fur garments, jewels, jewelry, watches, pearls, precious and semi-precious stones, platinum, silver,
gold and other precious metals and alloys;
(g)
wharves, piers, marine docks, tunnels, dams, dikes, natural earth reservoirs and bridges;
(h)
property illegally acquired, kept, stored or transported, or property seized or confiscated by order of
public authority;
(i)
property in course of ocean marine transit from the time of being loaded on board any vessel;
(j)
underground property (except underground storage tanks) situated outside building foundations, but
services and connections of sewage, drainage or fire protection systems within the boundaries of
building lots are not excluded;
(k)
growing plants (except for those used for decorative purposes within buildings), animals, fish and birds;
(l)
transmission and distribution lines not on the Insured’s premises;
(m)
satellites;
(n)
property more specifically insured.
5
3.
Insured Perils
This Policy section insures against direct physical loss or damage from Earthquake only, to the Insured
Property, commencing during the Policy period, except as excluded herein.
4.
Excluded Perils
This Policy section shall not insure against loss, destruction, or damage caused directly or indirectly by any of
the following excluded perils. Such loss or damage is excluded regardless of any other cause or event that
contributes concurrently or in any sequence to the loss, unless otherwise stated.
5.
(a)
by contributed to, or aggravated by mold, moss, mildew, fungi, spores, bacterial infestation or any
similar organism, anthrax, small pox, viruses of all kinds, wet or dry rot and extremes of temperature or
humidity, whether directly or indirectly the result of a covered peril. This includes, but is not limited to,
the cost for investigation, testing remediation services, extra expense or business interruption. Such
loss is excluded regardless of any other cause or event that contributes concurrently or in any sequence
to the loss. If loss otherwise covered by this Policy occurs and the cost of removal of debris is increased
due to the presence of rust, mold, moss, fungus, bacterial infestation, wet or dry rot and extremes of
temperature or humidity, this Policy will only be liable for the costs of debris removal which would
have been incurred had no such factors been present in, on or about the covered property to be
removed;
(b)
by delay, loss of market, loss of use and occupancy or consequential loss;
(c)
loss or damage arising directly or indirectly from nuclear detonation, reaction, nuclear radiation or
radioactive contamination, all whether controlled or uncontrolled, or due to any act or condition
incident to any of the foregoing, whether such loss be direct, indirect, proximate or remote, or be in
whole or in part caused by, contributed to, or aggravated by, any physical loss or damage insured
against by this Policy, however such nuclear detonation, reaction, nuclear radiation or radioactive
contamination may have been caused;
(d)
loss or damage arising directly or indirectly from the dispersal, application or release of, or exposure to,
chemical, bacteriological, viral, biological or similar agents or matters, all whether controlled or
uncontrolled, or due to any act or condition incident to any of the foregoing, whether such loss be
direct, indirect, proximate or remote or be in whole or in part caused by, contributed to, or aggravated
by, any physical loss or damage insured against by this Policy, however such dispersal, application,
release or exposure may have been caused;
(e)
by loss or damage arising from war, invasion, acts of foreign enemies, hostilities or warlike operations
(whether war be declared or not), civil war, rebellion, revolution, insurrection, civil commotion
assuming the proportions of or amounting to an uprising, military or usurped power;
Valuation
For the purpose of settling claims, adjustment of the physical loss amount under this Policy will be computed as
of the date of the loss, at the Location of the loss, and for no more than the Interest of the Insured, subject to
the following:
The value of the Insured Property is agreed as follows:
(a)
Stock
(i)
Raw Stock (materials and supplies in the state in which the Insured received them for conversion
by the Insured into finished Stock, including supplied consumed in such conversion or in the
service rendered by the Insured) shall be valued at Replacement Cost at the time and place of
loss.
(ii)
Stock in process (raw Stock which has undergone any aging, seasoning, or other processing by
the Insured but which has not become finished Stock) shall be valued at the value of the raw
materials and labour expended plus the proper proportion of overhead charges.
6
(iii)
(b)
Finished Stock (Stock which in the ordinary course of the Insured’s business is ready for packing,
shipment or sale) and merchandise shall be valued at the Insured’s selling price at the time of
loss, less all discounts, rebates, and unincurred expenses to which such sales price would have
been subject.
Fine Arts
The value of each item is agreed as follows:
(i)
if appraised prior to the loss: the value stated therefor on the most current appraisal;
(ii)
if not appraised: the value of the item as declared to the Company prior to the loss;
(iii) in the absence of an appraisal or an itemized schedule of declared values: the Actual Cash
Value, not to exceed the sublimit stated in Section A, General Conditions, Sublimits.
"Fine Arts" shall be limited to: paintings, etchings, pictures, tapestries and other bona fide works of art
(such as antique furniture, valuable rugs, rare books, manuscripts, statuary, marble, bronze, porcelains,
antique silver and bric-a-brac) all of which are rare or have historical or artistic value or merit.
(c)
Mobile and/or Contractors Equipment
In case of loss, settlement shall be based on the Actual Cash Value of the property at the time of loss or
damage occurs and the loss or damage shall be ascertained or estimated according to such Actual Cash
Value with proper deduction for depreciation, however caused, and shall in no event exceed what it
would then cost to repair or replace the same with material of like kind and quality.
(d)
All Other Property
“Replacement Cost” meaning the cost of repairing, replacing, constructing or reconstructing (whichever
is the least) the property on the same site, using new materials of like kind and quality and for like
occupancy without deduction for depreciation.
In the event of loss, destruction or damage to the property insured, the Company agrees to make
settlement on the basis of Replacement Cost subject to the following provisions:
(i)
until the property is actually repaired, replaced or reconstructed, the maximum amount
recoverable shall be the actual cash value of the lost or damaged property;
(ii)
replacement shall be effected by the insured with due diligence and dispatch;
(iii)
replacement shall be on the same site;
(iv)
failing compliance by the Insured with any of the foregoing provisions, settlement shall be made
as if this coverage had not been in effect.
This Policy shall not insure any additional costs or expenses resulting from there being in force at the
time of loss, any law, building law, regulation or ordinance restricting or prohibiting repair,
replacement or reinstatement of property except as provided under Building Laws or Ordinances in this
Policy section.
(e)
Loss Limit of Liability
The premium for this Policy is based upon the Statement of Values provided. In the event of loss under
the Policy, the liability of the Company shall be limited to the least of the following:
i)
ii)
The amount of loss;
100% of the total stated value for each category insured, for which a claim has been presented,
including, building, contents, machinery and equipment, Stock, business income or Gross Earnings,
Extra Expense and any other coverage provided at such Location, as shown on the latest Statement
of Values or other documentation on file with the Company;
iii) The Limit of Liability, any Sublimit of Insurance or Amount of Insurance specifically used in this
Policy that applies to any Insured loss or coverage or Location.
7
6.
Building Laws or Ordinances
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, this Policy covers the
reasonable and necessary costs incurred to satisfy the minimum requirements of building laws or ordinances,
existing on the date of loss, regulating the demolition, construction, repair, or replacement of buildings or
structures, This coverage provides for the cost to:
(a)
(b)
(c)
Repair or rebuild only the damaged portion of the building or structure, with material and in a manner
to satisfy such law or ordinance;
Demolish any physically undamaged portion of the building or structure when the total demolition of
the physically damaged building or structure is required to satisfy such laws or ordinances; and
Rebuild the demolished portion of the building or structure with materials and in a manner to satisfy
such laws or ordinances when the total demolition of the physically damaged building or structure is
required to satisfy such laws or ordinances;
Building Law and/or Ordinance enforcement must be as a direct result of such insured physical loss or
damage at the Insured Location sustaining direct physical loss or damage.
This additional coverage does not cover loss due to any law or ordinance with which the Insured was
legally required to comply had the loss not occurred.
This coverage excludes the:
(a)
(b)
Cost of demolition; and/or
Increased cost of construction, repair, replacement, debris removal or loss of use;
that is incurred as a result of enforcement of any laws or ordinances regulating any form of
contamination including but not limited to pollution or hazardous material.
7.
Debris Removal
In accordance with the Sublimit stated in Section A., General Conditions, Sublimits, this Policy is extended to
cover the necessary and reasonable expenses actually incurred by the Insured due to physical loss or damage
as insured against occurring during the term of this Policy to remove from premises which are described on
the Statement of Values, debris of covered property remaining after any such loss or damage, except that no
liability is assumed for the expense of removal of:
(a)
(b)
(c)
any foundation, other than damaged portions which must be removed for repair or rebuilding of any
covered building or structure; or
any property or part thereof, the removal of which is required by the enforcement of any law,
ordinance, regulation or rule regulating or restricting the construction, installation, repair,
replacement, demolition, occupancy, operation or other use of such property; unless extended to
cover elsewhere in this Policy; or
Pollutants from land or water, nor for the cost to remove, restore or replace polluted land or water.
8.
Personal Property of Officers, Employees and Guests
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, this Policy is extended to
cover personal property of officers, employees and guests. Losses if any, shall be adjusted with the Insured.
This clause shall not apply if the personal property is insured by the owner thereof unless the Insured is
contractually obliged to provide insurance.
9.
Exterior Trees, Plants, Shrubs and Lawns
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, it is agreed that this Policy
is extended to cover for loss or damage to exterior trees, plants, shrubs and lawns.
10.
Third Party Vehicles
Notwithstanding any vehicle exclusion contained in Property Exclusions of Policy Section B, it is agreed that
this Policy shall extend to cover loss or damage to any vehicle(s) belonging to others while on the premises of
8
the Insured for the purpose of loading and unloading, but only when the Insured is contractually liable for
such damage. This coverage shall not apply to loss or damage caused by the collision of such vehicle(s) with
any other vehicle(s) or object.
This extension is excess of any other insurance whether collectable or not.
11.
Miscellaneous Costs, Fees, Charges and Expenses
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, after the Occurrence of
loss from any peril(s) insured herein, this Policy shall insure the reasonable expenses incurred by or assessed
against the Insured required for loss settlement purposes and for accountants and consultants (except not
including Public Adjusters, Attorneys and Insurance Brokers, or agents and loss appraisers, including any of
their subsidiary, related or associated entities) to produce and certify particulars and details required and
approved by the Insurer in connection with any loss reported under this Policy.
12.
Miscellaneous Unnamed Locations
In accordance with the Sublimit stated in Section A, General Conditions, this Policy is extended to cover Real
and Personal Property of the type covered at any Location within the Policy Territory which is not on the
Described Premises of the Statement of Values on file with this Company, to the extent of the Insured’s
interest therein. No coverage is provided under this provision for property while in transit or waterborne, nor
while on the premises of any exhibition, exposition, fair or trade show.
Miscellaneous Unnamed Locations do not include any property insured or excluded under any other item of
this Policy or under any other Policy issued by the Company to this Insured. If such property is insured in
whole or in part by other insurance, then this Policy shall apply only as excess insurance, and in no event as
contributing insurance, and then only after all other insurance has been exhausted.
13.
Civil Authority
This Policy shall insure loss which is sustained directly by the Insured as a result of damage to Insured
Location(s) caused by an order of civil authority to retard or prevent a conflagration or other catastrophe by
an insured peril.
14.
Service Interruption
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, this Policy also covers
direct physical damage caused by a peril insured against resulting from the interruption of steam, gas, water,
electricity, sewage, telecommunication or other services. This Policy does not cover any loss or damage
caused by any deliberate interruption or reduction of any service by any utility or authority.
9
Policy Section C
Data Processing Equipment and Media
1.
Insured Property
The insurance afforded under this Policy section, subject to the Electronic Date Recognition Form and Cyber
Risk (Electronic Data Endorsement) attached, covers the property described hereunder:
(a)
Hardware
This term shall mean and include any calculating or computing or data processing or word processing
systems, including equipment and component parts thereof, and any air conditioning equipment used
exclusively in connection therewith.
(b)
Software
This term shall mean and include generally all data, computer programs and media. Without restricting
the foregoing, this includes all forms of converted data and programs and instruction vehicles
employed in the Insured's data or word processing operations.
2.
Limit of Liability
The Company’s liability in respect to insurance provided hereunder shall not exceed the
Limit stated in Policy Section A of the General Conditions.
3.
Insured Perils
This Policy section insures against direct physical loss or damage from Flood, Earthquake only, to the Insured
Property, commencing during the Policy period, except as excluded herein.
4.
Exclusions
In addition to Policy Section B, Perils Excluded, this Policy section does not insure:
(a)
depreciation;
(b)
Loss or damage caused by distortion, corruption or impeded or diminished use of or access to any
Electronic Media including computer data, coding, program or software resulting from any intentional,
malicious, or reckless act;
(c)
Loss or damage caused by electronic memory losses, electrical disturbance or power supply
disturbance, however caused;
5.
Basis of Loss Settlement
(a)
Hardware
Replacement Cost
In the event of loss, indemnity shall be made on the basis of the new Replacement Cost of the damaged
property. Damaged property may be replaced by property of greater or more efficient processing
ability, but the Company’s liability shall not exceed the new Replacement Cost of property similar in
kind, capacity, size and quality to that which sustained the loss.
Until the property is actually repaired, replaced or reconstructed, the maximum amount recoverable
shall be the Actual Cash Value of the lost or damaged property.
(b)
Software
(i) Data and Programs
The Company’s liability shall be limited to the actual cost of reproducing the lost information,
including the cost of gathering or assembling data or information for such reproduction.
(ii) Media
The Company’s liability shall be limited to the actual cost of repairing or replacing the damaged or
lost property with material of like kind and quality.
If not repaired, replaced or restored within two years from the date of loss, the blank value of the Data,
Programs and Media.
10
Policy Section D
Accounts Receivable
1.
Insuring Agreement
This Policy section insures against direct physical loss or damage from Flood, Earthquake only, to the Insured
Property, commencing during the Policy period, except as excluded herein.
2.
Limit of Liability
The Company’s liability in respect to insurance provided hereunder shall not exceed the
Limit stated in Policy Section A of the General Conditions.
3.
Subject of Insurance
(a)
All sums due to the Insured from customers, provided the Insured is unable to effect collection thereof
as the direct result of loss of or damage to records of accounts receivable insured under this Policy;
(b)
Interest charges on any loan to offset impaired collections pending repayment of such sums made
uncollectible by such loss or damage insured under this Policy;
(c)
Collection expense in excess of normal collection cost and made necessary because of such loss or
damage insured under this Policy;
(d)
Other expenses when reasonably incurred by the Insured in re-establishing records of accounts
receivable following such loss or damage insured under this Policy.
4.
Exclusions
In addition to Policy Section B, Perils Excluded, this Policy section does not insure:
(a)
loss due to bookkeeping, accounting or billing errors or omissions;
(b)
loss, the proof of which as to factual existence is dependent solely upon an audit of records or an
inventory computation; but this shall not preclude the use of such procedures to support a claim for
loss which the Insured can prove, through evidence wholly apart therefrom, is due solely to a risk of
loss to records of accounts receivable not otherwise excluded hereunder;
(c)
loss due to alteration, falsification, manipulation, concealment, destruction or disposal of records of
accounts receivable committed to conceal the wrongful giving, taking, obtaining or withholding of
money, securities or other property but only to the extent of such wrongful giving, taking, obtaining or
withholding.
5.
Basis of Loss Settlement
In the event that the Insured cannot accurately establish the total amount of accounts receivable outstanding
as of the date loss occurs, such amount shall be based on the Insured's monthly statements and shall be
computed as follows:
(a)
determine the amount of all outstanding accounts receivable at the end of the same fiscal month in the
year immediately preceding the year in which the loss occurs;
(b)
calculate the percentage of increase or decrease in the average monthly total of accounts receivable
for the twelve months immediately preceding the month in which the loss occurs as compared with
such average for the same months of the preceding year;
(c)
the sum determined under (a), increased or decreased by the percentage calculated under (b), shall be
the agreed total amount of accounts receivable on the last day of the fiscal month in which said loss
occurs;
(d)
the amount determined under (c) shall be increased or decreased in conformity with the normal
fluctuations in the amount of accounts receivable during the fiscal month involved, due consideration
being given to the expiration of the business since the last day of the last fiscal month for which
statement has been rendered;
(e)
there shall be deducted from the total amount of accounts receivable the amount of such accounts
evidenced by records not lost or damaged, or otherwise collected or established by the Insured, and an
amount to allow for probable bad debts that would normally have been uncollectible by the Insured.
11
6.
Recoveries
After payment of loss, all amounts recovered by the Insured on accounts receivable for which the Insured has
been indemnified shall belong and be paid to the Company by the Insured up to the total amount of loss paid
by the Company, but all recoveries in excess of such amounts shall belong to the Insured.
12
Policy Section E
Valuable Papers and Records
In consideration of the premium charged and subject to all its stipulations and conditions, this Policy is extended to
cover loss to valuable papers and records resulting from damage or destruction by an insured peril during the term
of this Policy.
1.
Property Covered
On all valuable papers and records, defined as, but not limited to, “written, printed or otherwise inscribed
documents and records, including but not limited to books, maps, films, drawings, abstracts, deeds,
mortgages and manuscripts, but does not mean money and securities”.
The insured property may be owned by the Insured or held by him in any capacity; provided, the insurance
applies only to the interest of the Insured in such property, including the Insured’s liability to others, and does
not apply to the interest of any other person or organization in any of said property unless included in the
Insured’s Proof of Loss.
2.
Limit of Liability
The Company’s liability in respect to insurance provided hereunder shall not exceed the
Limit stated in Policy Section A of the General Conditions.
3.
Insured Perils
This Policy section insures against direct physical loss or damage from Flood, Earthquake only, to the Insured
Property, commencing during the Policy period, except as excluded herein.
4.
Locations Insured
Insurance under this Form shall apply only while valuable papers and records are contained in the premises
scheduled on the Statement of Values on file with the Company, or while being removed to and while at place
of safety because of imminent danger of loss and while being returned from such place.
5.
Removal
Such insurance as is afforded by this form applies while the valuable papers and records are being removed to
and while at a place of safety because of imminent danger of loss and while being returned from such place,
provided the Insured gives written notice to the Company of such removal within ten (10) days thereafter.
6.
Exclusions
In addition to Policy Section B, Perils Excluded, this Policy section does not insure:
(a)
to loss directly resulting from errors or omissions in processing or copying unless fire or explosion
ensues and then only for direct loss caused by such ensuing fire or explosion;
(b)
to loss of property held as samples or for sale or for delivery after sale;
7.
Definitions
The following words wherever used in this Policy shall mean:
“Money” means currency, coins, bank notes and bullion; and traveler’s checks, registered checks and money
orders held for sale to the public.
8.
“Securities” mean all negotiable and non-negotiable instruments or contracts representing either money or
other property and includes revenue and other stamps in current use, tokens and tickets, but does not
include money.
Valuation and Settlement Options
Valuation shall not exceed the least of the following:
(a)
(b)
(c)
(d)
The cost of repair or restore the item to the condition that existed immediately prior to the loss
The cost to replace the item
The amount designated for the item on the schedule on file with the Company
Any Sublimit stated in the Policy.
13
Until the property is actually repaired, replaced or reconstructed, the maximum amount recoverable shall be
the actual cash value of the lost or damaged property.
14
Policy Section F
Business Interruption—Extra Expense
1.
Insuring Agreement
If insured property which is declared on the Statement of Values is lost, damaged or destroyed during the
term of this Policy by a peril not excluded (in accordance with the conditions of the applicable Policy section),
this Policy section is extended to cover necessary Extra Expense incurred by the Insured in order to continue
as nearly as practicable the normal conduct of the Insured's business following the Occurrence of such loss or
damage.
The Company’s liability for such incurred Extra Expense (as defined herein), shall be for the period of time that
the business of the Insured is affected by the loss, destruction or damage, commencing with the date of the
loss but not limited by the date of expiration of this Policy, for not exceeding such length of time as would be
required with the exercise of due diligence and dispatch to cover necessary extra expense, but not exceeding
the Actual Loss Sustained by the Insured, and not exceeding twelve (12) consecutive months from the date of
the loss.
2.
Limit of Liability
The Company’s liability in respect to insurance provided hereunder shall not exceed the
Limit stated in Policy Section A of the General Conditions.
3.
Definition
(a)
"Extra Expense" means the excess (if any) of the total cost during the “Indemnity Period” for the
purpose of continuing the Insured’s business over and above the total cost that would normally have
been incurred to conduct the business during the same period had no loss occurred; the cost in each
case to include expense of using other property or facilities of other concerns or other similar
necessary emergency expenses. In no event, however, shall the Company be liable under this Policy
section for loss of income, nor for Extra Expense in excess of that necessary to continue as nearly as
practicable the normal conduct of the Insured's business, nor for the cost of repairing or replacing any
of the described property that has been damaged or destroyed by the perils insured against, except
cost in excess of the normal cost of such repairs or replacements necessarily incurred for the purpose
of reducing the total amount of Extra Expense; liability for such excess cost, however, shall not exceed
the amount by which the total Extra Expense otherwise payable under this Policy is reduced. The
Company shall also be liable for Extra Expense incurred in obtaining property for temporary use during
the period of restoration necessarily required for the conduct of the Insured's business; any salvage
value of such property remaining after resumption of normal operations shall be taken into
consideration in the adjustment of loss hereunder.
(b)
"Normal" shall mean the condition which would have existed had no loss occurred.
4.
Resumption of Operations
As soon as practicable after any loss, the Insured shall resume complete or partial business operations and,
insofar as practicable, reduce or dispense with such extra expenses as are being incurred.
5.
Additional Exclusions
The Company shall not be liable under this section of this Policy for:
(a)
(b)
(c)
(d)
(e)
loss due to the suspension, lapse or cancellation of any lease or license, contract or order which may
affect the Insured's business after the period during which indemnity is payable;
loss due to fines or damages for breach of contract for late or non-completion of orders, or for any
penalties of whatever nature;
any increase of loss due to interference at the described premises by strikers or other persons with
rebuilding, repairing or replacing the property, or with the resumption or continuation of business;
any other consequential or remote loss.
15
Policy Section G
Business Interruption—Gross Earnings
(Mercantile or Non-Manufacturing)
1.
Insuring Agreement
This section of this Policy insures loss directly resulting from necessary interruption of the Insured’s business
caused by destruction or damage by any peril(s) insured (in accordance with the conditions of the applicable
Policy Section), occurring during the term of this Policy, to any property insured by this Policy which is
declared on the Statement of Values.
2.
Measure of Recovery
The measure of recovery in the event of loss hereunder shall be the reduction in "Gross Earnings" directly
resulting from such interruption of business less charges and expenses which do not necessarily continue
during the interruption of business, for not exceeding such length of time as would be required with the
exercise of due diligence and dispatch to rebuild, repair or replace such part of the above described property
as has been destroyed or damaged, commencing with the date of such destruction or damage and not limited
by the expiry date of this Policy, but not exceeding the ACTUAL LOSS SUSTAINED by the Insured resulting from
such interruption of business. Due consideration shall be given to the continuation of normal charges and
expenses, including payroll, to the extent necessary to resume operations of the Insured with the same
quality of service, which existed immediately preceding the destruction or damage, by the perils insured
against.
The length of time of necessary interruption of business for which indemnity is payable is limited, in addition
to those provisions set out in this Form, to a maximum of (12) Twelve consecutive calendar months following
the date of destruction or damage.
3.
Gross Earnings
For the purpose of this Policy, "Gross Earnings" are defined as the sum of:
(a)
Total net sales, and
(b)
Other earnings derived from the operations of the business,
less the cost of:
(c)
Materials and supplies consumed directly in supplying the service(s) sold by the Insured,
(d)
Merchandise sold, including packaging materials therefor,
(e)
Service(s) purchased from outsiders (not employees of the Insured) for resale which do not continue
under contract, and
(f)
"Ordinary Payroll" expense.
In determining "Gross Earnings" due consideration shall be given to the experience of the business before the
date of damage or destruction and the probable experience thereafter had no loss occurred.
Further, due consideration shall be given to the Insured’s actual experience after the loss, and any post-loss
increase in earnings over historical earnings that may be attributable, in whole or in part, to circumstances
resulting from the loss itself shall serve as an offset to any loss of earnings otherwise sustained during the
period of interruption.
16
4.
5.
Special Exclusions
The Company shall not be liable for:
(a)
Any increase of loss due to interference at the Insured's premises by strikers with rebuilding, repairing
or replacing the property or with the resumption or continuation of business;
(b)
Loss due to fines or damages for breach of contract, for late or non-completion of orders or for any
penalties of whatever nature;
(c)
Any increase in loss due to the suspension, lapse or cancellation of any lease or license, contract or
order, which may affect the Insured's earnings after the period during which indemnity is payable;
(d)
any loss resulting from damage to or destruction of merchandise and/or Stock nor for the time
required to reproduce any merchandise and/or Stock, which may be damaged or destroyed for
merchandise and/or Stock that is valued at selling price;
(e)
any other consequential or remote loss.
Definitions
(a)
"Normal" means the conditions which would have existed had no loss occurred;
(b)
"Ordinary Payroll" means the entire payroll expense for all employees of the Insured, whose services
would not be dispensed with should the business be interrupted, except officers, executives,
departmental managers, employees under contract and other key employees.
6.
Resumption of Operations
If the Insured by resumption of complete or partial operation of the property insured or by making use of
other property, equipment or supplies, could reduce the loss resulting from interruption of business, such
reduction shall be taken into account in arriving at the amount of loss under this Policy section.
7.
Expenses to Reduce Loss
This Policy section also covers expenses as are necessarily incurred for the purpose of reducing any loss under
this section of this Policy (except expenses incurred to extinguish a fire), but in no event shall the aggregate of
such expenses exceed the amount by which the loss under this Policy section is thereby reduced.
8.
Leasehold Interest
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, in the event of direct
physical loss to property Insured against and occurring during the term of this Policy, this Policy is extended to
cover Leasehold Interest as defined herein.
I)
Measurement of Loss
The recoverable Leasehold Interest incurred by the Insured of the following:
(a)
If the lease agreement requires continuation of rent; and if the property is wholly untenantable or
unusable, the actual rent payable for the unexpired term of the lease; or if the property is partially
untenantable or unusable, the proportion of the rent payable for the unexpired term of the lease.
(b)
If the lease is cancelled by the lessor pursuant to the lease agreement or by the operation of law;
the Lease Interest for the first three months following the loss; and the Net Lease Interest for the
remaining unexpired term of the lease.
II) References and Application
The following term(s) means:
(a)
Lease Interest:
17
The excess rent paid for the same or similar replacement property over actual rent payable plus
cash bonuses or advance rent paid (including maintenance or operating charges) for each month
during the unexpired term of the Insured’s lease.
(b)
Net Lease Interest:
That sum which placed at 6% interest rate compounded annually would equal the Lease Interest
(less any amounts otherwise payable hereunder).
Additional Exclusions
This Policy does not insure any increase in loss resulting from the suspension, lapse or cancellation of any
license, or from the Insured exercising an option to cancel the lease; or from any act or omission of the
Insured that constitutes a default under the lease.
In addition, there is no coverage for the Insured’s loss of Leasehold Interest directly resulting from physical
loss or damage to Personal Property.
9.
Commissions, Profits and Royalties
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, in the event of direct
physical loss or damage of the type Insured against and occurring during the term of this Policy, this Policy is
extended to cover Commissions, Profits and Royalties, as defined herein.
I)
Measurement of Loss:
(a) The recoverable Commissions, Profits and/or Royalties is the Actual Loss Sustained by the Insured of
the following during the Period of Indemnity:
(i) Commissions, Profits and Royalties;
(ii) Less noncontinuing expenses and charges during the Period of Indemnity:
(b) The Commissions, Profits And Royalties payable hereunder will be the Actual Loss Sustained of
income to the Insured during the Period of Indemnity under any royalty, licensing fee or commission
agreement between the Insured and another party (other than Contingent Property) which is not
realizable due to physical loss or damage insured by this Policy to property of the other party of the
type insured by this Policy located within the Policy’s Territory.
(c) The Insured will influence, to the extent possible, said party(ies) with whom the agreements
described above have been made to use any other machinery, supplies or Locations in order to
resume business so as to reduce the amount of loss hereunder, and the Insured will cooperate with
that party in every way to effect this. This Policy does not cover any cost to effect the above unless
authorized in advance by the Company.
(d) In determining the indemnity payable hereunder, the Company will consider the amount of income
derived from such agreements before and the probable amount of income after the date of loss or
damage.
(e) There is recovery hereunder but only if such loss or damage interrupts the delivery of goods in whole
or in part to the Insured or for their account.
II) References and Application
The following term(s) means:
(a) Commissions:
The income that would have been received by the Insured from the sale of goods not owned by the
Insured.
(b) Profits:
The amount that would have been received by the Insured from the sale of goods belonging to the
Insured, in excess of the cost to the Insured of such goods.
18
(c) Royalties:
The income the Insured is not able to collect under Royalty or licensing agreements.
10. Interruption by Civil Authority
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, this Policy is extended to
include the actual loss as covered hereunder, not exceeding fourteen (14) consecutive days, while access to
the Insured Location is prohibited by order of civil authority, but only when such order is given as a result of
direct physical loss or damage to other property within One (1) Statute mile of Insured Location, by a peril
insured against. Recovery hereunder is limited solely to the Insured Location situated within One (1) Statute
mile of the damaged property.
11.
Prevention of Ingress/Egress
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, this Policy is extended to
cover the actual loss sustained by the Insured, due to the necessary interruption of the Insured’s business, not
exceeding fourteen (14) consecutive days, due to prevention of ingress to or egress from the Insured’s
property, whether or not the property of the Insured shall have been damaged, provided that such
interruption must be a result of physical damage of the type insured against and not excluded by the Policy,
to the kind of property not excluded by this Policy and located within One (1) Statute mile of Insured
property.
12.
Direct Contingent Business Interruption
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, this Policy is extended to
cover the necessary Business Interruption of the Insured, occurring during the term of this Policy, directly
resulting from physical loss or damage of the type Insured against by this Policy, to property not excluded by
this Policy, at direct supplier or direct customer Locations situated within the Territory provisions of this
Policy.
The term “supplier or customer” does not include any Company supplying to or receiving from the Insured
property, as described elsewhere in this Policy, electricity, fuel, water, gas, steam refrigeration, sewage or
telecommunications.
13.
Service Interruption
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, this section of the Policy is
extended to cover the Insured's loss arising from the interruption of business due to loss, destruction or
damage by an Insured Peril to any off-premises power, gas, water or telecommunication supply Locations or
facilities furnishing or transmitting power, gas, water or telecommunications for the Insured's operations.
This Policy does not cover any loss or damage caused by any deliberate interruption or reduction of any
service by any utility or authority.
14.
Building Laws or Ordinances
If coverage is provided in Policy Section B, Loss of Property, and a Sublimit is stated in Section A, General
Conditions, in the event that loss recoverable under this Policy section is increased due to the operation of
any law(s) and/or ordinance(s) regulating the demolition, repair, reconstruction, replacement or use of the
property, the Company shall be liable for such increase in loss, as defined under Policy Section B, Loss of
Property.
19
Policy Section H
Business Interruption Insurance
Rent or Rental Value Form
1.
Insuring Clause
If a part or all of any property Insured under this Policy which is declared on the Statement of Values be lost,
damaged or destroyed during the term of this Policy by an Insured Peril (in accordance with the conditions of
the applicable Policy Section), the Company shall indemnify the Insured for loss as provided herein.
2.
Measure of Recovery
The measure of recovery in the event of loss hereunder shall be the reduction in “gross rent and rental value”
directly resulting from being untenantable and directly due to destruction or damage by the perils insured
against to insured buildings, less charges and expenses which do not necessarily continue during the period
the building(s) is so untenantable, for not exceeding such length of time as would be required with the
exercise of due diligence and dispatch to rebuild, repair or replace such part of the building(s) insured as has
been destroyed or damaged, commencing with the date of such destruction or damage and limited to a
period of twelve (12) consecutive months from the date of such destruction or damage, but not exceeding the
ACTUAL LOSS SUSTAINED by the Insured resulting from the building(s) being untenantable.
3.
Provisions
(a)
If during the Indemnity Period Gross Rent and Rental Value shall be earned elsewhere than at the
premises for the benefit of the business either by the Insured or by others on his behalf, the money
paid or payable in respect of such sales or services shall be brought into account in arriving at the
Rental Income during the Indemnity Period.
(b)
In the event of loss the Insured shall, with due diligence, take all actions to minimize any interruption of
or interference with the business or to avoid or diminish the loss, including the use of other available
property(ies).
(c)
Further, due consideration shall be given to the Insured’s actual experience after the loss, and any
post-loss increase in earnings over historical earnings that may be attributable, in whole or in part, to
circumstances resulting from the loss itself shall serve as an offset to any loss of earnings otherwise
sustained during the period of interruption.
4.
Resumption of Operations
If the Insured by resumption of complete or partial operation of the property insured or by making use of
other property, equipment or supplies, could reduce the loss resulting from interruption of business, such
reduction shall be taken into account in arriving at the amount of loss under this Policy section.
5.
Expenses to Reduce Loss
This Policy section also covers expenses as are necessarily incurred for the purpose of reducing any loss under
this section of this Policy (except expenses incurred to extinguish a fire), but in no event shall the aggregate of
such expenses exceed the amount by which the loss under this Policy section is thereby reduced.
6.
Additional Exclusion(s)
The Company shall not be liable under this Policy section for:
(a)
loss due to the suspension, lapse or cancellation of any lease or license, contract or order which may
affect the Insured's business after the period during which indemnity is payable;
(b)
loss due to fines or damages for breach of contract for late or non-completion of orders, or for any
penalties of whatever nature;
(c)
loss due to interference at the described premises by strikers or other persons, with rebuilding,
repairing or replacing the property, or with the resumption or continuation of business and;
20
(d)
7.
8.
any other consequential or remote loss.
Definitions
“Gross Rent and Rental Value” is defined as the sum of:
(a)
the actual total annual gross rent or rental value of the occupied portion(s) of the building(s);
(b)
the estimated annual rental value of the unoccupied portion(s) of the building(s); and
(c)
a fair rental value of the portion(s), if any, of the building(s) occupied by the insured Insured.
Leasehold Interest
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, in the event of direct
physical loss to property Insured against and occurring during the term of this Policy, this Policy is extended to
cover Leasehold Interest as defined herein.
I)
Measurement of Loss:
The recoverable Leasehold Interest incurred by the Insured of the following:
(a) If the lease agreement requires continuation of rent; and if the property is wholly untenantable or
unusable, the actual rent payable for the unexpired term of the lease; or if the property is partially
untenantable or unusable, the proportion of the rent payable for the unexpired term of the lease.
(b) If the lease is cancelled by the lessor pursuant to the lease agreement or by the operation of law;
the Lease Interest for the first three months following the loss; and the Net Lease Interest for the
remaining unexpired term of the lease.
II)
References and Application.
The following term(s) means:
(a) Lease Interest:
The excess rent paid for the same or similar replacement property over actual rent payable plus
cash bonuses or advance rent paid (including maintenance or operating charges) for each month
during the unexpired term of the Insured’s lease.
(b) Net Lease Interest:
That sum which placed at 6% interest rate compounded annually would equal the Lease Interest
(less any amounts otherwise payable hereunder).
Additional Exclusions:
This Policy does not insure any increase in loss resulting from the suspension, lapse or cancellation of any
license, or from the Insured exercising an option to cancel the lease; or from any act or omission of the
Insured that constitutes a default under the lease.
In addition, there is no coverage for the Insured’s loss of Leasehold Interest directly resulting from physical
loss or damage to Personal Property.
9.
Building Laws or Ordinances
If coverage is provided in Policy Section B, Loss of Property, and a Sublimit is stated in Section A, General
Conditions, in the event that loss recoverable under this Policy section is increased due to the operation of
any law(s) and/or ordinance(s) regulating the demolition, repair, reconstruction, replacement or use of the
property, the Company shall be liable for such increase in loss, as defined under Policy Section B, Loss of
Property.
21
10.
Service Interruption
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, this section of the Policy is
extended to cover the Insured's loss arising from the interruption of business due to loss, destruction or
damage by an Insured Peril to any off-premises power, gas, water or telecommunication supply Locations or
facilities furnishing or transmitting power, gas, water or telecommunications for the Insured's operations.
This Policy does not cover any loss or damage caused by any deliberate interruption or reduction of any service
by any utility or authority.
11. Interruption by Civil Authority
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, this Policy is extended to
include the actual loss as covered hereunder, not exceeding fourteen (14) consecutive days, while access to
the Insured Location is prohibited by order of civil authority, but only when such order is given as a result of
direct physical loss or damage to other property within One (1) Statute mile of Insured Location, by a peril
insured against. Recovery hereunder is limited solely to the Insured Location situated within One (1) Statute
mile of the damaged property.
12.
Prevention of Ingress/Egress
In accordance with the Sublimit stated in Section A, General Conditions, Sublimits, this Policy is extended to
cover the actual loss sustained by the Insured, due to the necessary interruption of the Insured’s business, not
exceeding fourteen (14) consecutive days, due to prevention of ingress to or egress from the Insured’s
property, whether or not the property of the Insured shall have been damaged, provided that such
interruption must be a result of physical damage of the type insured against and not excluded by the Policy,
to the kind of property not excluded by this Policy and located within One (1) Statute mile of Insured
property.
22
Policy Section I
Conditions
The following Conditions apply to all Forms attached to this Policy providing insurance against loss or damage to
property arising from the perils insured by these Forms.
1.
TERRITORIAL LIMITS
This Policy covers only within the limits of the United States and Canada (excluding transportation to and from
Alaska and Hawaii).
2.
CURRENCY
Unless otherwise stated, all sums referred to herein shall be in United States currency.
3.
VALUATION
This Company shall not be liable beyond the actual cash value of the property at the time any loss or damage
occurs. Actual Cash Value is defined as the amount it would cost to repair or replace insured property, on the
date of loss, with material of like kind and quality, with proper deduction for obsolescence and physical
depreciation.
4.
OTHER INSURANCE
If at the time of loss or damage there is available any other insurance which would apply in the absence of this
Policy, the insurance under this Policy shall apply only as excess insurance over such other insurance.
5.
PERMISSIONS CLAUSE
Permission is hereby granted:
i)
ii)
iii)
to do work and to make such changes in the use or occupancy of the premises as is usual or incidental to
the business of the Insured;
to make alterations, additions, improvements and repairs;
to shut down or cease operations and for individual buildings or units to remain vacant or unoccupied
without limit of time.
However, this Company, unless endorsed hereon, shall not be liable for loss occurring:
when the entire building or plant has ceased operations or been unoccupied or vacant for a period exceeding
Sixty (60) days at any one time, or
b) while the hazard is increased by any means within the control or knowledge of the Insured.
a)
6.
MISREPRESENTATION AND FRAUD
This entire Policy shall be void if, whether before or after a loss, the Insured has concealed or misrepresented any
material fact or circumstance concerning this Insurance or the subject thereof, or the interest of the Insured
therein, or in case of any fraud or false swearing by the Insured relating thereto.
7.
MATERIAL CHANGE
Any change material to the risk and within the control and knowledge of the Insured voids the contract as to the
part affected thereby, unless the change is promptly notified in writing to the Company. The Company, when so
notified may return the unearned portion, if any, of the premium paid and cancel the contract, or may notify the
Insured in writing that, if he desires the contract to continue in force, he must, within (15) fifteen days of the
receipt of such notice, pay an additional premium. In default of such payment the contract is no longer in force
and the Company shall return the unearned portion, if any, of the premium paid.
8.
MACHINERY
In the event of loss of or damage to machinery consisting, when complete for sale or use, of several parts, the
Company shall only be liable for the value of the part(s) lost or damaged.
9.
LABELS
In the event of loss of or damage to labels, capsules or wrappers, the loss shall be adjusted on the basis of an
amount sufficient to pay the cost of new labels, capsules or wrappers.
23
10. PAIR, SET OR PARTS
In event of loss of or damage to:
(a)
any article or articles which are a part of a pair or set, the measure of loss of or damage to such article or
articles shall be a reasonable and fair proportion of the total value of the pair or set, giving consideration to
the importance of said article or articles, but in no event shall such loss or damage be construed to mean
total loss of the pair or set; or
(b)
any part of property covered consisting, when complete for use, of several parts, the Company shall only be
liable for the value of the part lost or damaged.
11. NO BENEFIT TO BAILEE
This Insurance shall in no wise inure directly or indirectly to the benefit of any carrier or other bailee.
12. REQUIREMENT AFTER LOSS
In the event of physical loss or damage that may give rise to a claim under this Policy, the Insured shall:
(a)
immediately give notice thereof in writing to the Company;
(b)
deliver within ninety (90) days after the loss, unless such time is extended in writing by the Company, a
proof of loss verified by a statutory declaration;
(i)
giving a complete inventory of the damaged property and showing in detail quantities, costs,
value and particulars of amount of loss claimed;
(ii)
stating when and how the loss occurred, and if caused by explosion or fire due to ignition, how
the fire or explosion originated, insofar as the Insured knows or believes;
(iii) stating that the loss did not occur through the procurement or connivance of the Insured;
(iv) showing the amount of other insurance and the names of other Insurers;
(v)
showing the interest of the Insured and of all others in the property with particulars of all liens,
encumbrances and other charges upon the property;
(vi) showing any changes in occupation, Location, possession, exposures, title or use of the property
since the issuance of this Policy;
(vii) showing the place where the property insured was at the time of loss;
(c)
if required, give a complete inventory of undamaged property, showing, in detail, quantities, costs and
values;
(d)
if required and if practicable, produce Stock lists, warehouse receipts and books of account, and furnish
invoices and/or other vouchers verified by statutory declaration and furnish a copy of the written
portion of any other contract;
13. SALVAGE
The Insured, in the event of any insured loss or damage to any property insured under the contract, shall take
all reasonable steps to prevent further damage to such property so damaged and to prevent damage to other
property insured hereunder including, if necessary, its removal to prevent damage or further damage thereto.
The Company shall contribute pro rata towards any reasonable and proper expenses in connection with steps
taken by the Insured and required under the above paragraph according to the respective interests of the
parties.
14. ACCESS AND ENTRY
After loss or damage to insured property, the Company has an immediate right of access and entry by
representatives sufficient to enable them to survey and examine the property, and to make an estimate of the
loss or damage, and, after the Insured has secured the property, a further right of access and entry sufficient to
enable them to make appraisement or particular estimate of the loss or damage.
15. CLAIMS AGAINST THIRD PARTIES
In the event of any loss of or damage to the property covered hereunder the Insured shall immediately make claim
in writing against the carrier(s), bailee(s), or others involved.
The adjustment of the loss or damage remains the right of the Company.
24
16. NOTICE OF LOSS
The Insured shall immediately report in writing to the Company every loss, damage or Occurrence which may give
rise to a claim under this Policy and shall also file with the Company within Ninety (90) days from date of discovery
of such loss, damage or Occurrence, a detailed sworn Proof of Loss.
The Insured warrants and agrees to give prompt notice to the Local Police Authorities in the event of theft of the
insured property, provided theft is covered under this Policy.
17. PAYMENT OF LOSS
All adjusted claims shall be paid or made good to the Insured within Sixty (60) days after presentation and
acceptance of satisfactory proof of interest and loss at the office of the Company. No loss shall be paid or made
good if the Insured has collected the same from others.
18. SUBROGATION
If in the event of loss or damage the Insured shall acquire any right of action against any individual, firm or
corporation for loss of, or damage to, property covered hereunder, the Insured will, if requested by the
Company, assign and transfer such claim or right of action to the Company or, at the Company’s option,
execute and deliver to the Company the customary form or loan receipt upon receiving an advance of funds in
respect of the loss or damage; and will subrogate the Company to, or will hold in trust for the Company, all
such rights of action to the extent of the amount paid or advanced, and will permit suit to be brought in the
Insured's name under the direction of and at the expense of the Company. The foregoing extension of
coverage is subject to the provisions of the Deductible and Limit of Liability Clauses cited in Policy Section A.
19. IMPAIRMENT OF RECOVERY RIGHTS
Any act or agreement by the Insured before or after loss or damage whereby any right of the Insured to
recover in whole or in part for loss or damage to property covered hereunder against any carrier, bailee or
other party liable therefor, is released, impaired or lost, shall render this Policy null and void, but the
Company’s right to retain or recover the premium shall not be affected. The Company is not liable for any loss
or damage which, without its written consent, has been settled or compromised by the Insured.
20. PROTECTION AND PRESERVATION OF PROPERTY
In the event of actual or imminent physical loss or damage as insured against, this policy is extended to cover
the necessary and reasonable expenses incurred in recovering and temporarily safeguarding covered property.
The expenses so incurred shall be borne by the Insured and the Company(ies) proportionately to the extent of
their respective interest. The Company(ies) portion of such expenses shall be limited to the extent such
expenses reduce loss or damage which would otherwise be payable under this policy. This provision does not
increase any amounts or limits of insurance which may be applicable and the deductible provisions shall apply to
any expenses so incurred.
21. COMPANY'S OPTIONS
It shall be optional with the Company to take all, or any part, of the property at the agreed or appraised value, and
also to repair, rebuild or replace the property destroyed or damaged with other of like kind and quality within a
reasonable time, on giving notice of its intention to do so within Sixty (60) days after the receipt of the Proof of Loss
herein required.
22. ABANDONMENT
There can be no abandonment to the Company of any property.
23. PRIVILEGE TO ADJUST WITH OWNER
In the event of loss of or damage to property of others held by the Insured for which claim is made upon the
Company, the right to adjust such loss or damage with the owner or owners of the property is reserved to the
Company and the receipt of such owner or owners in satisfaction thereof shall be in full satisfaction of any claim of
the Insured for which such payment has been made. If legal proceedings be taken to enforce a claim against the
Insured as respects any such loss or damage, the Company reserves the right at its option without expense to the
Insured, to conduct and control the defense on behalf of and in the name of the Insured. No action of the
25
Company in such regard shall increase the liability of the Company under this Policy, nor increase the Limits of
Liability specified in the Policy.
24. EXAMINATION UNDER OATH
The Insured, as often as may be reasonably required, shall exhibit to any person designated by the Company all
that remains of any property herein described, and shall submit, and insofar as is within his or their power cause
his or their employees, members of the household and others to submit, to examinations under oath by any
person named by the Company and subscribed the same; and, as often as may be reasonably required, shall
produce for examination all writings, books of account, bills, invoices and other vouchers, or certified copies
thereof if originals be lost, at such reasonable time and place as may be designated by the Company or its
representative, and shall permit extracts and copies thereof to be made. No such examination under oath or
examination of books or documents, nor any other act of the Company or any of its employees or representatives
in connection with the investigation of any loss or claim hereunder, shall be deemed a waiver of any defense which
the Company might otherwise have with respect to any loss or claim, but all such examinations and acts shall be
deemed to have been made or done without prejudice to the Company's liability.
25. APPRAISAL
If the Insured and the Company fail to agree as to the amount of loss, each shall, on the written demand of
either, made within Sixty (60) days after receipt of Proof of Loss by the Company, select a competent and
disinterested appraiser, and the appraisal shall be made at a reasonable time and place. The appraisers shall
first select a competent and disinterested umpire, and failing for Fifteen (15) days to agree upon such umpire,
then, on the request of the Insured or the Company, such umpire shall be selected by a judge of a court of
record in the state in which such appraisal is pending. The appraisers shall then appraise the loss, stating
separately the actual cash value at the time of loss and the amount of loss, and failing to agree shall submit their
differences to the umpire. An award in writing of any two shall determine the amount of loss.
The Insured and the Company shall each pay his or its chosen appraiser and shall bear equally the other
expenses of the appraisal and umpire. The Company shall not be held to have waived any of its rights by any act
relating to appraisal.
26. SUIT
No suit, action or proceeding for the recovery of any claim under this Policy shall be sustainable in any court of law
or equity unless the same be commenced within Twelve (12) months next after the Occurrence which gives rise to
the claim. Provided, however, that if by the laws of the State within which this Policy is issued such limitation is
invalid, then any such claims shall be void unless such action, suit or proceeding be commenced within the shortest
limit of time permitted by the laws of such State.
27. LOSS, IF ANY, SHALL BE PAYABLE AS FOLLOWS:
(a)
On all real and personal property: To the Insured(s) or their order.
(b)
On business interruption losses, if insured herein: To the Insured(s).
28. RECORDS AND INVENTORY
The Insured shall keep accurate books, records and accounts in the following manner:
(a)
a detailed and itemized inventory record of all property covered hereunder shall be maintained and
physical inventory shall be taken periodically at intervals not more than twelve months apart;
(b)
a set of books showing a complete record of the business transacted including all purchases and sales for
both cash and credit;
(c)
detailed records of:
(i)
the property of others in his or their custody and control;
(ii)
all travelers Stocks; and
(iii) property sent to others for any purpose;
(d)
all such books, records and accounts shall be preserved for not less than one year following the termination
of this Policy and any renewal thereof.
26
29. EXAMINATION OF RECORDS
The Insured shall, as often as may be reasonably required during the term of this Policy and for one year thereafter,
produce for examination by the Company or its duly authorized representative all the books and records,
inventories and accounts referred to above, relating to the property covered hereunder.
30. AUTOMATIC REINSTATEMENT
Each claim paid hereunder reduces the amount of insurance by the sum paid, but the amount of such loss shall be
reinstated automatically. However, if any limit provided herein is cited as being an "Annual Aggregate Limit" for
specified perils, this clause shall not be construed to increase that limit beyond the cited amount during any one
annual Policy period in respect of loss directly resulting from such specified perils.
31. CHANGES
Notice to any agent or knowledge possessed by any agent or by any other person shall not effect a waiver or a
change in any part of this Policy or estop the Company from asserting any right under the terms of this Policy, nor
shall the terms of this Policy be waived or changed, except by endorsement issued to form a part of this Policy.
32. CONFLICT OF WORDING
If there is any conflict between these CONDITIONS and the language contained in the Policy forms or
endorsements, it is agreed that the latter shall govern.
33. CONFORMITY TO STATUTE
Terms of this Policy which are in conflict with the statutes of the state wherein this Policy is issued are hereby
amended to conform to such statutes.
27
Named Insured
Endorsement Number
Montana Association of Counties
A
Policy Number
Policy Period
EAF781722-16
07/01/2016
Effective Date of Endorsement
to
07/01/2017
Issued By
07/01/2016
Endorsement Issue Date
AXIS Surplus Insurance Company
07/01/2016
This endorsement changes the policy. Please read it carefully.
NAMED INSURED SCHEDULE
The Named Insured section of the Common Policy Declarations is deleted in its entirety and replaced by:
Montana Association of Counties and its Subsidiaries, Associated or Allied Companies, Corporations,
Firms, Organizations, and its Interest in any Partnerships or Joint Ventures in which it has at least FiftyOne Percent (51%) Management Control or Ownership as now constituted or hereafter is acquired as
their Respective Interest of Each may appear, all hereafter referred to as the Insured, including Legal
Representatives.
ES 109 0107
Named Insured
Endorsement Number
Montana Association of Counties (See Endorsement A)
Policy Number
Policy Period
EAF781722-16
07/01/2016
B
Effective Date of Endorsement
to
07/01/2017
Issued By
07/01/2016
Endorsement Issue Date
AXIS Surplus Insurance Company
07/01/2016
This endorsement changes the policy. Please read it carefully.
SCHEDULED LIMIT OF LIABILITY ENDORSEMENT
In the event of loss hereunder, liability of the Company shall be limited to the least of the following.
A. The actual adjusted amount of loss, less applicable deductible(s) or self-insured retention(s).
B. 100% of the individually stated value for each scheduled item of property, time element, or other
coverages shown on the latest Application or Statement of Values on file with Company, less
applicable deductible(s) or self insured retention(s). If Actual Cash Value applies, then the maximum
amount payable is 100%.
C. The Limit of Liability, Amount of Insurance or sublimit is shown or endorsed onto the Policy. If a
sublimit is shown on the policy, the lesser limit shall apply.
D. The maximum amount payable under the Coinsurance Clause.
ES 138 0106
Named Insured
Endorsement Number
Montana Association of Counties (See Endorsement A)
Policy Number
Policy Period
EAF781722-16
07/01/2016
C
Effective Date of Endorsement
to
07/01/2017
Issued By
07/01/2016
Endorsement Issue Date
AXIS Surplus Insurance Company
07/01/2016
This endorsement changes the policy. Please read it carefully.
MINIMUM EARNED PREMIUM CLAUSE - PERCENTAGE
In the event of cancellation of this policy by the Insured, a minimum earned premium of 35% of the
original policy premium shall become earned; any conditions of the policy to the contrary
notwithstanding.
Failure of the Insured to make timely payment of premium shall be considered a request by the
Insured for the Company to cancel. In the event if such cancellation by the Company for nonpayment of premium, the minimum earned premium shall be due and payable; provided, however,
such non-payment cancellation shall be rescinded if the Insured remits the full premium due within
10 days of receiving it.
In the event of any other cancellation by the Company, the earned premium shall be computed
pro-rata, not subject to the minimum premium.
ES 106 0106
Named Insured
Endorsement Number
Montana Association of Counties (See Endorsement A)
Policy Number
Policy Period
EAF781722-16
07/01/2016
D
Effective Date of Endorsement
to
07/01/2017
Issued By
07/01/2016
Endorsement Issue Date
AXIS Surplus Insurance Company
07/01/2016
This endorsement changes the policy. Please read it carefully.
COMMERCIAL PROPERTY EXCLUSION ENDORSEMENT
1.
EXCLUSIONS
A. POLLUTANTS AND CONTAMINANTS EXCLUSION
1) As used in this endorsement, Pollutants or Contaminants means:
a. Any solid, liquid, gaseous or thermal irritant or contaminant including smoke, vapor, soot,
fumes, acids, alkalis, chemicals, and waste. Waste includes materials to be recycled,
reconditioned or reclaimed.
b. Pollutants or contaminants include, but are not limited to those materials that can cause
or threaten damage to human health or human welfare or cause or threaten damage,
deterioration, loss of value, marketability or loss of use to property. Pollutants or
contaminants include, but are not limited to bacteria, fungi, mold, mildew, virus or
hazardous substances as listed in the Federal Water Pollution Control Act, Clean Air Act,
Resource Conservation and Recovery Act of 1976, Toxic Substances Control Act or as
designated by the U.S. Environmental Protection Agency or any other governing
authority.
2) This policy does not cover any of the following.
a. Loss or damage caused by, resulting from, contributed to or made worse by actual,
alleged or threatened release, discharge, escape or dispersal of pollutants or
contaminants, however caused;
b. The expense or cost to extract or remove pollutants or contaminants from debris;
c.
The expense or cost to extract or remove pollutants or contaminants from land or water;
d. The expense or cost to extract or remove, restore or replace contaminated or polluted
land or water;
e. The costs associated with the enforcement or any ordinance or law which requires the
Insured or others to test for, monitor, clean up, remove, contain, treat, detoxify or
neutralize, or in any way respond to or assess the effects of pollutants or contaminants;
Page 1 of 3
ES 133 0106
f.
Any cost to transport any property or debris to a site for storage or decontamination
required because the property is infected by pollutants or contaminants, whether or not
such removal, transport or decontamination is required by law, regulation or any authority
governing such matters;
g. Any cost to store or otherwise dispose of any property because pollutants or
contaminants infect the property; or
h. Any expense for the investigation or defense of any loss, damage or any cost, loss of use
expense, fine or penalty or for any expense or claim or suit related to any of the above.
3) Additional Coverage
This policy is extended to cover the necessary and reasonable expenses actually incurred by
the insured to clean up or remove pollutants from land or water at Covered Locations under
this policy during the policy period if the discharge, dispersal, seepage, migration, release or
escape of the pollutants is directly caused by or results directly from fire, lightning, aircraft
impact, explosion, riot, civil commotion, smoke, vehicle impact, windstorm or hail, vandalism,
malicious mischief, leakage or accidental discharge from automatic fire protective system.
The most the Company will pay for such pollutant clean up or removal is a $10,000
aggregate in any one policy year. The expenses will be paid only if they are reported to the
Company in writing within 180 days of the date on which the covered loss occurs. This
additional coverage does not increase the Policy Limit of Insurance.
B. ASBESTOS, DIOXIN OR POLYCHLORINATED BIPHENOLS MATERIALS EXCLUSION
1) In this exclusion, Asbestos, Dioxin, and Polychlorinated Biphenols are all referred to as
“Materials.”
2) This policy does not cover loss or damage caused directly or indirectly by any of the
following:
a. Removal of such “Materials” from any goods, products, structures or debris;
b. Demolition, increased cost of reconstruction, repair, debris removal or loss of use
necessitated by the enforcement of any law or ordinance regulating such “Materials”;
c.
Any governmental direction or request declaring that such “Materials” present in or part of
or utilized in any undamaged portion of the Insured’s property can no longer be used for
the purpose for which it was intended or installed and must be removed or modified; or
d. Any expense for the investigation or defense of any loss, damage or any cost, loss of use
expense, fine or penalty or for any expense or claim or suit related to any of the above.
3) Additional Coverage
This policy is extended to cover the necessary and reasonable expenses actually incurred by
the Insured to remove Asbestos at Covered Locations under this policy during the policy
period if Asbestos itself is directly damaged by fire, lightning, aircraft impact, explosion, riot,
civil commotion, smoke, vehicle impact, windstorm or hail, vandalism, malicious mischief,
leakage or accidental discharge from automatic fire protective system. The most the
Company will pay for such Asbestos removal is a $10,000 aggregate in any one policy year.
The expenses will be paid only if they are reported to the Company in writing within 180 days
Page 2 of 3
ES 133 0106
of the date on which the covered loss occurs. This additional coverage does not increase the
Policy Limit of Insurance.
C. NUCLEAR EXCLUSION CLAUSE
1) The Company shall not be liable for loss or damage by nuclear reaction, nuclear radiation or
radioactive contamination, however caused.
2) This policy will not cover any cost or expense to defend any claim or suit or pay any
damages, loss or expense or obligation, resulting from nuclear reaction, nuclear radiation or
radioactive contamination, however caused.
D. FINES OR PENALTIES
This policy will not pay any costs, expenses, fines or penalties incurred or sustained by or
imposed on the Insured at the order of any government agency, court or other authority arising
from any cause whatsoever.
2.
OTHER INSURANCE CONTRACTS
Coverage provided by other insurance contract(s) for any exclusion in this endorsement shall not
affect the terms and conditions as set forth by this endorsement. This policy shall not cover as
excess insurance or contribute with such other insurance for loss or damage excluded by this
endorsement.
The policy changes provided by this endorsement shall supersede and annul any conflicting provisions of
the policy. All other matters not affected by this endorsement remain the same and shall be governed by
the terms and conditions of the Company’s policy to which this endorsement is attached.
Page 3 of 3
ES 133 0106
Named Insured
Endorsement Number
Montana Association of Counties (See Endorsement A)
Policy Number
Policy Period
EAF781722-16
07/01/2016
E
Effective Date of Endorsement
to
07/01/2017
Issued By
07/01/2016
Endorsement Issue Date
AXIS Surplus Insurance Company
07/01/2016
This endorsement changes the policy. Please read it carefully.
TOTAL EXCLUSION – ELECTRONIC PROPERTY AND VIRUS
This endorsement modifies insurance provided under all Coverage Parts.
A. It is agreed the following is not Covered Property:
Electronic Data
Electronic data means information, facts or computer programs stored as or on, created or used on,
or transmitted to or from computer software (including systems and applications software), on hard or
floppy disks, CD-ROMs, tapes, drives, cells, data processing devices or any other repositories of
computer software which are used with electronically controlled equipment. The term computer
programs, referred to in the foregoing description of electronic data, means a set of related electronic
instructions which direct the operations and functions of a computer or device connected to it, which
enable the computer or device to receive, process, store, retrieve or send data.
B. It is agreed the following are not Covered Causes of Loss:
1. Virus – A virus, harmful code or similar instruction introduced into or enacted on a computer
system (including electronic data) or a network to which it is connected, designed to damage or
destroy any part of the system or disrupt its normal operation.
2. Computer Manipulation – Loss or damage caused by or resulting from manipulation of a
computer system (including electronic data) by any employee, including a temporary or leased
employee, or by any entity retained by you or for you to inspect, design, install, modify, maintain,
repair or replace that system.
C. The following item is added as an EXCLUSION:
COST TO REPLACE ELECTRONIC DATA — The cost to replace or restore information which exists
as electronic data.
Page 1 of 2
ES 033 0106
D. The following is added to the Business Income (and Extra Expense) Coverage Form, if it applies:
ADDITIONAL LIMITATION – Interruption of Computer Operations
Coverage for Business Income does not apply when a “suspension” of “operations” is caused by
destruction or corruption of electronic data, or any loss or damage to electronic data.
Coverage of Extra Expense does not apply when action is taken to avoid or minimize a “suspension”
of “operations” caused by destruction or corruption of electronic data, or any loss or damage to
electronic data.
Page 2 of 2
ES 033 0106
Named Insured
Endorsement Number
Montana Association of Counties (See Endorsement A)
Policy Number
Policy Period
EAF781722-16
07/01/2016
F
Effective Date of Endorsement
to
07/01/2017
Issued By
07/01/2016
Endorsement Issue Date
AXIS Surplus Insurance Company
07/01/2016
This endorsement changes the policy. Please read it carefully.
MOLD, FUNGI, WET OR DRY ROT, AND BACTERIA EXCLUSION ENDORSEMENT
1. EXCLUSIONS:
This policy does not cover:
A. Loss or damage caused directly or indirectly by mold or other fungi, wet or dry rot, or bacteria;
B. The costs associated with the enforcement of any ordinance or law which requires the Insured or
others to test for, monitor, clean up, remove, contain, treat, detoxify or neutralize, or in any way
respond to or assess the effects of mold or other fungi, wet or dry rot, or bacteria; or
C. Any costs, expenses, fines or penalties incurred or sustained by or imposed on the Insured at the
order of any government agency, court or other authority arising from any cause whatsoever.
This mold or other fungi, wet or dry rot, or bacteria exclusion applies whether or not the loss event
results in widespread damage or affects a substantial area.
2. LIMITED COVERAGE FOR MOLD, FUNGI, WET OR DRY ROT AND BACTERIA
This policy is extended to cover, subject to a maximum total limit of $10,000 per occurrence, loss or
damage directly caused by or resulting from mold or other fungi, wet or dry rot, or bacteria if such
mold or other fungi, wet or dry rot, or bacteria is directly caused by or results from one or more of the
following causes that occurs during the policy period:
•
Fire;
•
Lightning;
•
Explosion;
•
Windstorm;
•
Hail;
•
Smoke;
•
Vehicles;
Page 1 of 3
ES 084 0106
•
Aircraft;
•
Civil disturbance;
•
Riot;
•
Vandalism;
•
Sprinkler leakage;
•
Leakage from fire extinguishing equipment;
•
Sinkhole collapse;
•
Volcanic action;
•
Falling objects;
•
Weight of snow, ice or sleet;
•
Water damage; or
•
Collision, or upset or overturn of a transporting vehicle:
1) at locations occupied by the Insured; or
2) away from the locations occupied by the Insured when the transporting vehicle is owned,
operated, rented, leased or borrowed by the Insured.
If this policy includes coverage for flood, earthquake or earth movement it will be considered a
covered peril for mold or other fungi, wet or dry rot, or bacteria.
As applied to this limited coverage for loss or damage by mold, fungi, wet or dry rot, and bacteria,
“loss or damage” means:
A. Direct physical loss or damages to Covered Property by mold, fungus, wet or dry rot or bacteria,
including the cost of removal of the mold, fungus, wet or dry rot or bacteria;
B. The cost to tear out and replace any part of the building or other property as needed to gain
access to the mold, fungus, wet or dry rot or bacteria; and
C. The cost of testing performed after removal, repair, replacement or restoration of the damaged
property is completed, provided there is reason to believe that mold, fungus, wet or dry rot or
bacteria are present.
Page 2 of 3
ES 084 0106
The maximum total limit provided by this coverage extension is $10,000 per occurrence regardless of
the number or type of coverages that may apply, the number of locations to which this coverage
extension applies, or regardless of the number or type of mold or other fungi, wet or dry rot, or
bacteria that caused the loss or damage. When this agreement and any other insuring agreement or
endorsement written by the Company applies to the same mold or other fungi, wet or dry rot, or
bacteria loss, $10,000 is the most the Company will pay on a combined total basis for all such loss.
This amount is not in addition to the limits of coverage for real or personal property, flood, earthquake
or earth movement or time element coverage as specified elsewhere in this policy.
3. DEFINITIONS
A. Mold or other fungi means:
1) any type or form of mold or mildew;
2) any other type or form of fungus; or
3) any mycotoxin, spore, scent or byproduct that is produced or released by such mold, mildew
or other fungus.
B. Bacteria means:
1) any type or form of bacterium; or
2) any byproduct that is produced or released by such bacterium.
Page 3 of 3
ES 084 0106
Named Insured
Endorsement Number
Montana Association of Counties (See Endorsement A)
Policy Number
07/01/2016
Policy Period
07/01/2016
G
Effective Date of Endorsement
to
07/01/2017
Issued By
07/01/2016
Endorsement Issue Date
AXIS Surplus Insurance Company
07/01/2016
This endorsement changes the policy. Please read it carefully.
NUCLEAR, CHEMICAL AND BIOLOGICAL EXCLUSION ENDORSEMENT
The following exclusions are added to your Policy.
This insurance does not apply to:
A. Loss or damage arising directly or indirectly from nuclear detonation, reaction, nuclear radiation or
radioactive contamination, all whether controlled or uncontrolled, or due to any act or condition
incident to any of the foregoing, whether such loss be direct or indirect, proximate or remote, or be in
whole or in part caused by, contributed to, or aggravated by, any physical loss or damage insured
against by this Policy, however such nuclear detonation, reaction, nuclear radiation or radioactive
contamination may have been caused. This exclusion replaces any other nuclear detonation, nuclear
reaction, nuclear radiation or radioactive contamination exclusions found elsewhere in this Policy.
B. Loss or damage arising directly or indirectly from the dispersal, application or release of, or exposure
to, chemical or biological materials or agents that are harmful to property or human health, all whether
controlled or uncontrolled, or due to any act or condition incident to any of the foregoing, whether
such loss be direct or indirect, proximate or remote, or be in whole or in part caused by, contributed
to, or aggravated by, any physical loss or damage insured against by this Policy, however such
dispersal, application, release or exposure may have been caused.
C. This exclusion applies to all coverage under the Policy notwithstanding any coverage extension or
any other endorsement.
ES 116 0608
Named Insured
Endorsement Number
Montana Association of Counties (See Endorsement A)
Policy Number
Policy Period
EAF781722-16
07/01/2016
H
Effective Date of Endorsement
to
07/01/2017
Issued By
07/01/2016
Endorsement Issue Date
AXIS Surplus Insurance Company
07/01/2016
This endorsement changes the policy. Please read it carefully.
TERRORISM EXCLUSION ENDORSEMENT
A. The following exclusion is added:
Any other provision of this policy
notwithstanding, this insurance does not cover
loss, damage, injury, expense, cost or legal
obligation directly or indirectly resulting from or
arising out of or in any way related to any:
1. “Terrorism Act”; or
2. Actions taken by or on behalf of any
government or any branch or division thereof
(including, without limitation, the uniformed
armed forces, militia, police, state security and
anti-terrorism agencies) in responding to,
preventing, combating, defending or retaliating
against any “Terrorism Act.”
This exclusion applies regardless of any other
cause or event that in any way contributes
concurrently or in any sequence to the loss,
damage, injury, expense, cost or legal
obligation.
This exclusion applies whether or not the
“Terrorism Act” was committed in concert with or
on behalf of any organization or government.
B. As used in this endorsement:
“Terrorism Act” means any act, preparation in
respect of action or the threat of action that:
2. Reasonably appears to be intended, in whole
or in part, to:
a. Intimidate or coerce a civilian population or
any segment of a civilian population; or
b. Disrupt any segment of the economy of one
or more nations; or
c. Overthrow or influence the policy or conduct
of a government; or
d. Respond to any governmental action or
policy.
“Terrorism Act” shall also include any incident
determined to be such by an official, department
or agency that has been specifically authorized
by federal statute to make such a determination.
“Terrorism Act” includes the intentional dispersal
or application of pathogenic, or poisonous
biological or chemical materials and shall also
include any incident determined to be such by
an official, department or agency that has been
specifically authorized by federal statute to make
such a determination.
The terms and limitations of any terrorism
exclusion, or the inapplicability or omission of a
terrorism exclusion, do not serve to create
coverage for any loss or damage which would
otherwise be excluded under this policy.
1. Involves violence or is dangerous to human
life or tangible or intangible property (including
electronic, communications, information or
mechanical systems or infrastructure), and
AXIS TERROR EXCLUSION 01 06
POLICY NUMBER:
EAF781722-16
IL 09 53 01 15
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.
EXCLUSION OF CERTIFIED ACTS OF TERRORISM
This endorsement modifies insurance provided under the following:
BOILER AND MACHINERY COVERAGE PART
COMMERCIAL INLAND MARINE COVERAGE PART
COMMERCIAL PROPERTY COVERAGE PART
CRIME AND FIDELITY COVERAGE PART
EQUIPMENT BREAKDOWN COVERAGE PART
FARM COVERAGE PART
STANDARD PROPERTY POLICY
SCHEDULE
The Exception Covering Certain Fire Losses (Paragraph C) applies to property located in the following state(s),
if covered under the indicated Coverage Form, Coverage Part or Policy:
State(s)
CA, GA, ME, HI, IA, IL, MO, NC, NJ, NY, OR, RI, VI,
WA, WI, WV
Coverage Form, Coverage Part Or Policy
Information required to complete this Schedule, if not shown above, will be shown in the Declarations.
A. The following definition is added with respect to
the provisions of this endorsement:
"Certified act of terrorism" means an act that is
certified by the Secretary of the Treasury, in
accordance with the provisions of the federal
Terrorism Risk Insurance Act, to be an act of
terrorism pursuant to such Act. The criteria
contained in the Terrorism Risk Insurance Act for
a "certified act of terrorism" include the following:
1. The act resulted in insured losses in excess of
$5 million in the aggregate, attributable to all
types of insurance subject to the Terrorism
Risk Insurance Act; and
2. The act is a violent act or an act that is
dangerous to human life, property or
infrastructure and is committed by an individual
or individuals as part of an effort to coerce the
civilian population of the United States or to
influence the policy or affect the conduct of the
United States Government by coercion.
IL 09 53 01 15
B. The following exclusion is added:
CERTIFIED ACT OF TERRORISM EXCLUSION
We will not pay for loss or damage caused directly
or indirectly by a "certified act of terrorism". Such
loss or damage is excluded regardless of any
other cause or event that contributes concurrently
or in any sequence to the loss.
C. Exception Covering Certain Fire Losses
The following exception to the exclusion in
Paragraph B. applies only if indicated and as
indicated in the Schedule of this endorsement.
If a "certified act of terrorism" results in fire, we will
pay for the loss or damage caused by that fire.
Such coverage for fire applies only to direct loss or
damage by fire to Covered Property. Therefore, for
example, the coverage does not apply to
insurance provided under Business Income and/or
Extra Expense coverage forms or endorsements
which apply to those forms, or to the Legal Liability
Coverage Form or the Leasehold Interest
Coverage Form.
© Insurance Services Office, Inc., 2015
Page 1 of 2
If aggregate insured losses attributable to terrorist
acts certified under the Terrorism Risk Insurance
Act exceed $100 billion in a calendar year and we
have met our insurer deductible under the
Terrorism Risk Insurance Act, we shall not be
liable for the payment of any portion of the amount
of such losses that exceeds $100 billion, and in
such case insured losses up to that amount are
subject to pro rata allocation in accordance with
procedures established by the Secretary of the
Treasury.
Page 2 of 2
D. Application Of Other Exclusions
The terms and limitations of any terrorism
exclusion, or the inapplicability or omission of a
terrorism exclusion, do not serve to create
coverage for any loss which would otherwise be
excluded under this Coverage Part or Policy, such
as losses excluded by the Nuclear Hazard
Exclusion or the War And Military Action
Exclusion.
© Insurance Services Office, Inc., 2015
IL 09 53 01 15
Named Insured
Endorsement Number
Montana Association of Counties (See Endorsement A)
Policy Number
Policy Period
EAF781722-16
07/01/2016
I
Effective Date of Endorsement
to
07/01/2017
Issued By
07/01/2016
Endorsement Issue Date
AXIS Surplus Insurance Company
07/01/2016
This endorsement changes the policy. Please read it carefully.
SERVICE OF SUIT CLAUSE
The Company hereby designates the Superintendent, Commissioner or Director of Insurance, or his/her
designee, as its true and lawful attorney upon whom may be served any lawful process in any action, suit
or proceeding instituted by you or on your behalf or by any beneficiary under this Policy against the
Company arising out of this Policy, provided that all lawful process received by said Superintendent,
Commissioner or Director of Insurance, or his/her designee, is sent by certified or registered mail to the
Company at:
AXIS U.S. Insurance
Attention: Claims Administrator
11680 Great Oaks Way
Suite 500
Alpharetta, GA 30022
SOS-CW (08-03)
IN WITNESS WHEREOF, the Company has caused the facsimile signatures of its
President and Secretary to be affixed hereto, and has caused this policy to be signed on
the Declarations Page by an authorized representative of the Company.
Axis Surplus Insurance Company
Carlton W. Maner
President
Andrew Weissert
Secretary
ES 020 0607
CLAIM NOTICE
To report a new claim notice/loss, please notify:
AXIS U.S. INSURANCE
During business hours of 8:30 AM EST to 4:30 PM EST.
Mailing Address
PO Box 4470
Alpharetta, GA 30023
Shipping Address
11680 Great Oaks Way
Suite 500
Alpharetta, GA 30022
Phone:
Fax:
Toll Free Fax:
E-mail:
(678) 746-9400
(678) 746-9315
(866) 770-5629
[email protected]
After business hours
Please contact Cunningham Lindsey at 1-800-621-5410.
ES 036 0512