By Diana Kowatch, CPCU, AU, AAM, CPIW
The PF&M Companion is a service of the Policy, Form and Manual Analysis Service, published by the Rough Notes Company, Inc. Policy, Form and Manual Analysis (PF&M), continually updated since 1929, is the personal, commercial, and specialty policy and form analysis service provided by the Rough Notes Company. PF&M is available in paper, on disk in Three Part Harmony, and on CD-ROM through Silver Plume as Rough Notes. For more information on this service call 1-800-428-4384.
Includes copyrighted material of Insurance Services Office, Inc., or ISO Commercial Risk Services, Inc., with its permission; ©Copyright, Insurance Services Office, Inc., 1997; ©Copyright, ISO Commercial Risk Services, Inc., 1997.
COUNTRYWIDE
NEW 1997 HOMEOWNERS OPTIONAL PROPERTY REMEDIATION FOR ESCAPED LIQUID FUEL AND LIMITED LEAD AND ESCAPED LIQUID FUEL LIABILITY COVERAGE ENDORSEMENTS
Four new endorsements have been developed to provide home owners with limited first- and third-party coverages for specific pollution hazards. The first-party coverage is for escaped fuel remediation and applies when liquid fuel escapes from its storage system (system must contain a minimum combined capacity of 100 or more U.S. gallons). Up to $10,000 of coverage (a higher limit may be purchased) is provided for temporary repairs to prevent further escape or to stop the spread of fuel; expenses to test, monitor, or assess the effects of escaped fuel that is required by an outside source (other than the insured); additional living expenses; and loss or damage to shrubs, trees, and plants not grown for business. Not covered is the loss of market value of structure, loss of the actual liquid fuel, or damage from escape of liquid fuel in or for motor vehicles and/or watercraft.
The third-party coverage applicable to lead and escaped fuel liability coverage actually limits or reduces the insured's protection by capping the limit available to a $50,000 aggregate (higher limits may be purchased) for all claims against the insured from damage or injury because of lead and escaped fuel contamination.
The new endorsements are:
* HO 05 80, Property Remediation For Escaped Liquid Fuel and Limited Lead and Escaped Liquid Fuel Liability Coverages (all forms except HO 00 04 and HO 00 06)
* HO 05 81, Property Remediation For Escaped Liquid Fuel and Limited Lead and Escaped Liquid Fuel Liability Coverages (HO 00 04 only)
* HO 05 82, Property Remediation For Escaped Liquid Fuel and Limited Lead and Escaped Liquid Fuel Liability Coverages (HO 00 06 only)
* HO 05 83, Rating Information for Property Remediation For Escaped Liquid Fuel and Limited Lead and Escaped Liquid Fuel Liability Coverage
The above is a simplified recap of the new options. Please review each endorsement carefully before using. Listed below under the individual states, will be those that have approved these endorsements. This text will not be repeated but will refer back to this Countrywide section.
NEW 1997 MULTISTATE HOME BUSINESS INSURANCE COVERAGE ENDORSEMENT TITLED HOBIZ™
To accommodate the growing need for protection in the Homeowners policy for in-home businesses, ISO has developed a new optional endorsement that may be added to an existing policy. This endorsement offers coverage for business personal property above the $2,500 initially available in the HO policy and increases the off-premises business personal property from $250 to $5,000. Money is covered up to $1,000; and protection for business use of credit card, fund transfer card, forgery and counterfeit money is available for up to $1,000. The following coverages are added:
* Accounts Receivable--$5,000 on-premises and $2,500 off.
* Valuable Papers and Records--$2,500.
* Business Income--actual loss sustained.
* Extra Expense--actual.
* Civil Authority--covered is the actual loss sustained for business income and extra expense as a result of action by a civil authority prohibiting access to the residence premises.
Coverage E--Personal Liability is extended to cover business liability for premises and products-completed operations hazards. Protection is extended to include both personal injury and advertising injury liability.
Coverage F--Medical Payments to others is similarly extended to business occurrences.
Excluded are:
* professional liability
* specified instances of personal or advertising injury
* damage to impaired property or property not physically injured
* damage to particular property
* damage to your product
* damage to your work
* employers liability
* pollution
* recall of products, work, or impaired property
The limit for products-completed operations hazard is the same as that for the Coverage E limit shown in the Declarations. The limit for all other business liability is twice the sum of the Coverage E and F limits shown on the Declarations. The limit for Damage to Property of Others is increased to $2,500 per occurrence.
The above listed recap is only a portion of the overall coverage offered in the HOBIZ endorsement. Please review the entire endorsement carefully before using. Listed below under the individual states, will be those that have approved this endorsement. This text will not be repeated but will refer back to this Countrywide section.
ALABAMA
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
ALASKA
Revisions have been made to the Personal Auto Endorsement PP 04 93, Uninsured/Underinsured Motorists (UM/UIM) Coverage-Alaska, resulting form the Alaska Department of Insurance's interpretations of Alaska Stat. 21.89.020(e) on the minimum coverages for auto liability insurance and their decision that the insured may reject UM/UIM coverage for BI only. The endorsement has been revised accordingly. This change applies to all policies written on or after June 1, 1997.
ARKANSAS
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after August 1, 1997.
CALIFORNIA
Based upon the California Court of Appeals ruling in Wixon v. Amica Mut. Ins. Co, 53 Rptr. 2d 909 (Appl. 1st Dist. 1996), where the policy language regarding the calculation of earthquake deductibles was found to be ambiguous, revisions have been made to the following personal lines endorsements: HO 23 33--Earthquake-California, DP-J--Earthquake and Volcanic Eruption-California, and DP 23 81--Earthquake-California. These changes clarify that the percentage deductible is based upon a percentage of the Coverage A Limit of Liability and not the amount of loss. These endorsements may be used by participating insurers as of March, 1997.
COLORADO
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements have been implemented in Colorado--see the Countrywide section above. These forms are now available in Colorado.
CONNECTICUT
The 1994 Revisions To The Homeowners Multistate Endorsements have been approved in Connecticut with state-specific revisions, state-requested corrections, and amendments in numerous areas. Please review the entire program in detail to understand the changes. These changes apply to all policies written on or after September 1, 1997.
DELAWARE
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
FLORIDA
In response to 1996 Florida Laws (former S.B.2314) and the Florida Department of Insurance Information Bulletin 96-003, a new endorsement, BP 03 14, Florida Hurricane Percentage Deductible (Residential Risks), has been approved to provide percentage deductibles for residential risks on commercial policies. Applicable manual rules and loss costs also have been developed and approved. Endorsement BP 03 13, Florida Windstorm or Hail Percentage Deductible (Residential Risks), has been withdrawn. These changes apply to all policies effective on or after June 1, 1997.
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies effective on or after August 1, 1997.
GEORGIA
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
IDAHO
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
ILLINOIS
The Underground Storage Tank Liability Policy (UST), a claims-made liability policy which was developed to respond to EPA finalization of regulations on financial responsibility, has been approved. Covered is any UST incident over the deductible, for sums for damages and corrective action costs, subject to the amount of the actual damages/corrective action costs or the UST Incident Limit, whichever is least. Program forms include: CG 00 42-- Underground Storage Tank Policy; CG 04 26--Coverage For Injury To Leased Workers; CG 29 78--Exclusion-Underground Storage Tank Incidents; CG 30 57--Supplemental Extended Reporting Period Endorsement; CG 24 01--Non-Binding Arbitration Endorsement; CG 24 02--Binding Arbitration Endorsement; and CG 30 60--Amendatory Endorsement-Extended Reporting Periods. Also included are Illinois specific endorsements: CG 30 18, Illinois Changes--Cancellation and Nonrenewal and CG 30 62, Illinois Changes--Transfer Of Duties When A Limit Of Insurance Or The Defense Expense Amount Is Used Up. This change applies to all policies written on or after August 1, 1997.
INDIANA
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
IOWA
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
KANSAS
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after August 1, 1997.
KENTUCKY
The Personal Auto Endorsement PP 01 53, Amendment of Policy ProvisionsKentucky, has been amended as a result of Lewis v. West American Ins. Co., 927 S.W.2d 829 (Ky. 1996). The revision was made to delete the "household" exclusion under the liability portion; as a result, the endorsement now provides the insured with coverage up to policy limits when the person injured is a named insured or family member. This change applies to all policies written on or after May 1, 1997.
MICHIGAN
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after August 1, 1997.
MISSISSIPPI
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after August 1, 1997.
MISSOURI
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
MONTANA
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
NEBRASKA
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after August 1, 1997.
NEVADA
Approved is the 1997 multistate home business insurance coverage endorsement titled HOBIZ--refer to Countrywide above. This endorsement applies to all policies written on or after June 1, 1997.
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
NEW MEXICO
Approved is the 1997 multistate home business insurance coverage endorsement titled HOBIZ( --refer to Countrywide above. This endorsement applies to all policies written on or after August 1, 1997.
NORTH DAKOTA
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
OKLAHOMA
Three new homeowners endorsements have been developed and three existing endorsements have been revised, plus necessary changes have been made to applicable rules, as a result of the court case of Coblentz v. Oklahoma Farm Bureau Mutual Ins. Co., 915 P.2d 938 (Div.2 1995), Cert. Denied, P.2d (1996). In this case, the insured was eligible for replacement cost coverage, but the policy coverage provided actual cash value payment until the property had been repaired or replaced. Once replaced, the remainder would be reimbursed. Unfortunately, the insured was financially unable to comply with the replacement cost requirements in order to obtain that coverage. It was decided that the requirement was unfair and placed an undue burden on insureds. Thus the replacement cost coverage has been revised as it applies to both real and personal property. The new endorsements are:
* HO 05 88, Special Loss Settlement-Oklahoma
* HO 05 89, Modified Functional Replacement Cost Loss Settlement-Oklahoma
* HO 23 63, Personal Property Replacement Cost
The revised endorsements are:
* HO 01 35, Special Provisions-Oklahoma
* HO 05 09, Specified Additional Amount of Insurance Form Coverage A--Dwelling-Oklahoma
* HO 05 10, Additional Limits of Liability For Coverages A. B. C. and D-Oklahoma
These changes apply to all policies written on or after June 1, 1997.
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
RHODE ISLAND
Approval has been received on the 1994 commercial property changes to the rules, loss costs, forms, and SCOPES filings. These changes include: the base property damage deductible for buildings, personal property, spoilage, and builders' risk has been increased from $250 to $500. A buy-back to the $250 is available. Optional deductibles have been amended to start at $1,000 instead of $500. Condominium Commercial Unit-Owners Optional Coverage Form CP 04 18 has been revised as follows: Changes in rates were filed to coincide with the increase in the base deductible from $250 to $500. The endorsement provides additional loss assessment coverage subject to a separate schedule and limit but pays no more than $1,000 for an assessment due to the condominium association's policy deductible. The form has also been revised to allow for the insertion of a deductible for Loss Assessment.
Another major change in respect to SCOPES is as follows: The property protection class multipliers have been revised and will now base the multipliers on the building construction in addition to the protection class. The table for Windstorm or Hail Percentage Deductibles has been modified to adjust the ranges of the amount of insurance at each location. This revision was made to complement the deductible changes. The rating examples appendix has been amended to reflect the above changes. These change apply to all policies written on or after April 23, 1997.
Approval also has been received for the 01-96 Businessowners program Revisions. Many changes and revisions have been made to the ISO Businessowners program to incorporate and complement the numerous property, liability, and crime revisions that have been made to the commercial programs. Included are state-specific supplements and amendments. These changes apply to all policies written on or after July 1, 1997.
SOUTH CAROLINA
Approved is the 1997 multistate home business insurance coverage endorsement titled HOBIZ--refer to Countrywide above. This endorsement applies to all policies written on or after August 1, 1997.
SOUTH DAKOTA
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
UTAH
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997.
WEST VIRGINIA
The new 1997 Homeowners Optional Property Remediation For Escaped Liquid Fuel And Limited Lead And Escaped Liquid Fuel Liability Coverage Endorsements--see the Countrywide section above--are applicable to all policies written on or after July 1, 1997. *
CAUTION: Not all insurance companies use ISO forms. Some companies ask ISO to file forms, rules, and loss cost adjustments for them; other companies file for themselves. You will need to find out from each of your companies whether or not revisions or new forms will be adopted, and on what date the form, rule or loss cost adjustments will become effective.