MAPFRE INSURANCE COMPANY PERSONAL HOMEOWNERS RATE/RULE MANUAL

Transcription

1 MAPFRE INSURANCE COMPANY PERSONAL HOMEOWNERS RATE/RULE MANUAL Final Version July, 2011 Edition MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 1 of 28

2 Contents UNACCEPTABLE RISKS... 5 UNDERWRITING GUIDELINES... 6 LIMITS OF LIABILITY... 8 ELIGIBILITY... 8 DEFINITIONS SEASONAL/SECONDARY RESIDENCE PREMISES SINGLE AND SEPARATE BUILDINGS DEFINITION POLICY PERIOD CHANGES OR CANCELLATIONS MANUAL PREMIUM REVISION MULTIPLE COMPANY INSURANCE TRANSFER OR ASSIGNMENT WHOLE DOLLAR PREMIUM ADDITIONAL INTEREST (HO or HO 04 41) INFLATION GUARD RATING PROTECTION CLASSIFICATION INFORMATION CONSTRUCTION DEFINITIONS DEDUCTIBLES CLAIMS EXPERIENCE AGE OF HOME ROOF TYPE WILDFIRE RISK FACTOR FORM FACTOR TOWNHOUSE OR ROW HOUSE NUMBER OF FAMILIES DISCOUNTS SUPERIOR CONSTRUCTION PROTECTIVE DEVICES INSURED AGE MULTI-POLICY HOME RENOVATION OPTIONAL COVERAGES ORDINANCE OR LAW SPECIAL PERSONAL PROPERTY COVERAGE (HO and HO 17 31) MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 2 of 28

3 PERSONAL PROPERTY - REPLACEMENT COST LOSS SETTLEMENT ADDITIONAL AMOUNTS OF INSURANCE (HO 23 56) ACTUAL CASH VALUE LOSS SETTLEMENT WINDSTORM OR HAIL LOSSES TO ROOF SURFACING (HO 04 93). 16 REPLACEMENT COST LOSS SETTLEMENT FOR CERTAIN NON-BUILDING STRUCTURES (HO 23 99) COVERAGE BUNDLES BUILDING ADDITIONS AND ALTERATIONS AT OTHER RESIDENCES (HO 04 49) BUSINESS PROPERTY - INCREASED LIMIT (HO 04 12) CREDIT CARD, ELECTRONIC FUND TRANSFER CARD OR ACCESS DEVICE, FORGERY AND COUNTERFEIT MONEY (HO 04 53) UNIT OWNERS COVERAGE A DWELLING BASIC AND INCREASED LIMITS AND SPECIAL COVERAGE (HO 17 32) UNIT OWNERS - UNITS REGULARLY RENTED TO OTHERS (HO 17 33) PERMITTED INCIDENTAL OCCUPANCIES RESIDENCE PREMISES (HO 04 42) LOSS ASSESSMENT COVERAGE (HO 04 35) LOSS OF USE INCREASED LIMIT OTHER STRUCTURES PERSONAL PROPERTY PERSONAL PROPERTY SCHEDULED (HO or HO 04 61) RENTAL TO OTHERS - EXTENDED THEFT COVERAGE (HO 05 41) SPECIAL COMPUTER COVERAGE (HO 04 14) WATER BACK UP (HO 04 95) LANDLORDS FURNISHINGS (HO 05 46) ASSISTED LIVING CARE COVERAGE (HO 04 59) OTHER MEMBERS OF A NAMED INSURED S HOUSEHOLD (HO 04 58) MOTORIZED GOLF CART - PHYSICAL LOSS COVERAGE (HO 05 28) RESIDENCE HELD IN TRUST (HO 05 43) STUDENT AWAY FROM HOME (HO 05 27) IDENTITY FRAUD EXPENSE COVERAGE (HO 04 87) SECTION II COVERAGES RESIDENCE PREMISES - BASIC AND INCREASED LIMITS/OTHER EXPOSURES - BASIC LIMITS ADDITIONAL RESIDENCE RENTED TO OTHERS (HO 24 70) OTHER STRUCTURES RENTED TO OTHERS - RESIDENCE PREMISES (HO 04 40) PERMITTED INCIDENTAL OCCUPANCIES - RESIDENCE PREMISES AND OTHER RESIDENCES (HO or HO 24 43) MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 3 of 28

4 BUSINESS PURSUITS (HO 24 71) PERSONAL INJURY (HO 24 82) OUTBOARD MOTORS AND WATERCRAFT (HO 24 75) OWNED SNOWMOBILE (HO 24 64) INCIDENTAL FARMING PERSONAL LIABILITY (HO 24 72) COVERAGE E - PERSONAL LIABILITY - OTHER EXPOSURES COVERAGE F - MEDICAL PAYMENT TO OTHERS OTHER EXPOSURES WORKERS COMPENSATION (HO 24 90) LIMITED FUNGI, WET OR DRY ROT, OR BACTERIA COVERAGE (HO 04 26, HO 04 27, or HO 04 28) PAYMENT METHODS AND BILLING FEES ADDITIONAL FEES PROCEDURES SCHEDULE OF FORMS MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 4 of 28

5 UNACCEPTABLE RISKS Before quoting a risk or binding coverage, the agent should refer to the Unacceptable Risks list to determine acceptability. 1. Dwellings not located in the state where policy is written. 2. Dwellings without continuous Homeowner coverage. 3. Log home in Protection Class 9 or 10 or not assembled by a licensed building contractor. 4. Dwellings built on a slope of more than 30 degrees or built into a hillside or earthen dwellings. 5. Dwellings with composition over wood roofs. 6. Dwellings with three or more layers of roof. 7. Risks with more than 3 detached structures or more than 2 detached structures rented to other on the premises without Underwriting approval. 8. Applicants owning dangerous animal(s), or any animal(s) with a history of biting. A dangerous animal is one that presents an above average risk of causing harm. Examples: Wild animal or reptile capable of biting or causing physical injury. Vicious Dogs or Dogs with any prior biting history will be excluded from the policy. A Vicious Dog is defined as a dog with ancestry properties classified as any of the following breeds of dogs: Akita American Bull Dog Bull Mastiff or Mastiff Chow Doberman German Shepherd Pit Bull Pit Bull Terrier Presa Canario Rottweiler Staffordshire Bull Terrier Wolf Hybrid MAPFRE may consider writing individual cases on an unbound prior approval basis if the dog has passed the AKC Canine Good Citizens Program. The completed certificate must be presented to MAPFRE and a completed Dog Questionnaire is signed by the policyholder. 9. Applicants with more than 4 dogs and/or 5 livestock without Underwriting approval. 10. Vacant dwellings with the exception of Seasonal or Secondary Dwellings. Submit details on the vacancy to your Underwriter for guidance. 11. Trailer homes, houseboats, or boats used as a residence. 12. Modular Homes even if it is on a permanent foundation. 13. Dwellings in course of construction are not eligible. 14. Dwellings built prior to Without Underwriting approval, dwellings that are 50 years old or older without the following system updates in the past 35 years: electrical, heating and air-conditioning, and plumbing. 16. Dwellings with un-repaired damage or poor maintenance of dwelling, roof or premises including mine subsidence damage. May be acceptable for renewal business with Underwriting approval. 17. Without Underwriting approval, dwellings with masonry concrete walkways or foundations showing significant settling, cracking, or deterioration. 18. Risks with more than 4 residence employees, defined as an employee of the insured, who resides at the insured location year round, whose duties are related to the maintenance or use of the residence premises. Examples would be: caretaker, butler, maid, and au-pair. MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 5 of 28

6 19. Risks requesting to add non-individuals such as municipalities, businesses, corporations or companies as Named Insured or Additional Insureds. 20. Risks located in remote areas or which are inaccessible to emergency or fire-fighting vehicles and/or equipment. 21. Dwellings not built on an enclosed continuous foundation. Dwellings built on pier and post, wood or un-reinforced masonry foundations, dwellings without a permanent foundation or not bolted/anchored to the foundation (i.e. mobile homes), or dwellings supported by poles, stilts, columns or cantilevers. 22. Any requests for a One Day or Special Event Liability where the following is required: a. Limit of coverage for Personal Liability exceeds the limit of coverage on the policy b. Coverage for Liquor Liability 23. Dwellings with more than four family units 24. Risks with more one claim in 3 years. This rule does not apply to claims designated as catastrophe losses by ISO/PCS/CLUE. 25. Risks with unfenced swimming pools, trampolines without safety netting, or risks with a pool and diving board. Risks with swimming pools or spas not meeting the requirements outlined in Underwriting Guideline Risks with above-ground spas that are uncovered or above-ground spas that are unfenced. 27. Wood roofs more than 25 years old or roofs that are not in good condition. 28. Risks with a Fireline score greater than Multi-family dwellings built prior to 1979, with any unit rented where the dwelling is not certified for lead exposures, or any request to extend liability to one or more rental properties built prior to 1979 which have not been certified as Lead Safe for lead exposures are not eligible. 30. EIFS Siding (Exterior Insulation and Finishing System). Homes built with EIFS (synthetic stucco) siding must be built in 2000 and newer. Homes built prior to 2000 will be considered if evidence is submitted, prior to binding, that the EIFS siding contains a drainage system to prevent moisture from being trapped behind the covering. "Drainable EIFS" systems incorporate drainage channels behind the styrofoam panels which may be visible at the bottom of the exterior synthetic stucco wall. 31. Risks with any Day Care exposure on the premises. UNDERWRITING GUIDELINES If there are any questions regarding acceptability the agent should call Underwriting. 1. Applicant Policies must be written in the name of a current owner, spouse, or domestic partner. 2. Territory Dwellings must be located in the State of California. 3. Dwelling Address The exact dwelling address is required. When an exact dwelling address is non-existent, the legal description of the property as it appears on the deed or the address used by a local utility company is required. Rural route and box number addresses are unacceptable. 4. Occupancy- An owner occupied residence premises (HO3 or HO6), or a tenant occupied address (HO4 or HO6), used exclusively for private residential purposes are eligible for coverage. 5. Dwellings- Dwellings must be insured to a minimum of 100% of the estimated replacement cost using the Marshal Swift Boeckh (MSB) replacement cost calculator. 6. Secondary/Seasonal- Secondary/Seasonal homes must be insured on a separate HO3 or HO6 policy. The Eligibility Guidelines that apply to the primary residence also apply to a secondary or seasonal home. a) The liability limit and deductible on the secondary or seasonal residence must match that of the primary home. MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 6 of 28

7 b) The insured must have their primary dwelling insured with any MAPFRE company prior to binding a secondary or seasonal residence. c) A secondary residence is defined as an additional residence used for other than recreational purposes. d) A seasonal residence is defined as one which is a supplement to the insured s primary residence that is used for recreational or vacation purposes and is occupied less than 50% of the time. e) Secondary/Seasonal dwellings cannot be written on a HO5 policy. 7. Log Homes Log home dwellings are constructed of pre-cut solid logs (usually in kit form) that are assembled at the building site by a professional building contractor. Log homes are eligible provided they are located in protection class 1 through 8 and constructed by a qualified licensed contractor. 8. Brush The type of brush (fuel), terrain (slopes vs. flat areas), defensible space, and roof are significant factors affecting exposure. Canyons, steep hills, and slopes will increase the risk. These factors should be considered when binding risks in a brush area. a) As a general rule, brush must be cleared to a minimum of 50 feet from the dwelling. Increasing slopes should have increased defensible space clearance to be effective in protecting the home from fire. Brush must be cleared to a minimum of 100 feet from dwellings located on a slope. Dwellings built on a slope of more than 30 degrees are ineligible. b) Do not bind property within a mile of a brush fire until the fire has been out for 72 hours. In the event of a catastrophe, either natural or manmade, the company may invoke a moratorium on new business and endorsements/changes to existing business in the affected areas. c) Risks located within 2,000 feet of medium to heavy brush should be referred to an Underwriter for review and prior approval. 9. Condition of Property Each dwelling insured must be well maintained, have a roof in good repair, and must meet all guidelines outlined in this manual. 10. Wood Burning Stoves Risks with wood burning stoves are acceptable provided the stove has been installed or inspected by a heating contractor or other professional. The chimney/vent must be UL approved for wood, adhere to clearance standards and be maintained or inspected annually. An ABC rated fire extinguisher must be mounted close to the unit and/or be readily accessible. At least one smoke detector per floor must be installed. The interior section of the stove pipe cannot have more than two ninety (90 ) degree bands, be smaller in size than the exhaust collar or slant downward towards the chimney. The following situations make the risk ineligible for coverage: a) Wood burning stove is the sole source of heat b) Units not UL tested and/or approved c) Multiple venting (two or more units connected to the chimney/vent). d) Units with a heat saver or heat reclaimer in the vent pipe. e) Combination wood/gas units f) Homemade units g) Units installed in a garage A completed MAPFRE supplemental heating questionnaire must accompany the homeowners application. A supplemental application is not required for conventional masonry fireplaces, factory built fireplaces, built in fireplaces pellet stoves or coal burning furnaces. The company will perform an internal/external inspection on all risks with a wood burning stove. 11. Swimming Pools/Spas Swimming pools must be located in a completely fenced yard or enclosed and access restricted by the use of a locking gate. If a spa is present, the spa should be securely covered or fenced. If these conditions are not met, the risk is unacceptable. 12. Security Bars Windows and doors that are equipped with security bars must have an interior lock release mechanism to open the bars in case of an emergency. 13. Farms We do not offer a Farmowner s policy. MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 7 of 28

8 14. Scheduled Personal Property Personal property schedules cannot total more than 50% of the Coverage C limit. Schedule jewelry cannot exceed 25% of the Coverage C limit. Items valued or costing less than $500 will not be scheduled. See Endorsement information for requirements and restrictions on scheduled personal property. 15. Home Business The policy provides the business property coverage up to $2,500. Certain business occupancies will make a risk unacceptable if the nature of the business involves hazardous liability situations or materials. If the presence of the business changes the character of the residence from a private dwelling to commercial or mercantile, the risk is unacceptable. 16. Detached Structures Risks with more than 3 detached building structures on the premises or any one building structure which has a replacement cost of more than 100% of Coverage A requires a referral to underwriting. More than 3 detached building structures could be an indication of potential business or commercial exposures on the premises. A description of each structure and its usage should be discussed with underwriting prior to binding. LIMITS OF LIABILITY A. The available limits of liability under the Homeowners policy are as follows: HO-3 HO-5 HO-4 HO-6 Minimum Maximum Minimum Maximum Minimum Maximum Minimum Maximum Cov A $100,000 $2,000,000* $200,000 $2,000,000* - - $5,000 $750,000* Cov B Cov C 1-2 Family: 10% of Cov A 3-4 Family: 5% of Cov. A 1-2 Family: 50% of Cov A 3 Family: 30% of Cov A 4 Family: 1-2 Family: 100% of CovA 3-4 Family: 100% of CovA 1-2 Family: 100% of CovA 3-4 Family: 100% of CovA 1-2 Family: 10% of Cov A 3-4 Family: 5% of Cov. A 1-2 Family: 50% of Cov A 3 Family: 30% of Cov A 4 Family: 1-2 Family: 100% of CovA 3-4 Family: 100% of CovA 1-2 Family: 100% of CovA 3-4 Family: 100% of CovA $25,000 $400,000* $25,000 $400,000* 25% of Cov A 25% of Cov A Cov D 30% of Cov A 100% of CovA 30% of Cov A 100% of CovA 30% of Cov C 100% of CovC 50%of CovC 100%of CovC Cov E $100,000 $500,000 $100,000 $500,000 $100,000 $500,000 $100,000 $500,000 Cov F $1,000 $5,000 $1,000 $5,000 $1,000 $5,000 $1,000 $5,000 * Coverage A limits over $750,000 (HO3,HO5) and $500,000 (HO6) require Underwriter approval. Coverage C limits over $150,000 (HO4) and over $250,000 (HO6) require Underwriter approval. Higher limits may be available in some circumstances. It is mandatory that insurance be written for all coverages provided under both sections I and II of the homeowners policy. ELIGIBILITY A. All forms except HO-4 and HO-6 A Homeowner s policy may be issued: 1. To the owner-occupant(s) of a 1, 2, 3, or 4 family dwelling which is used exclusively for private residential purposes (except as provided in Paragraphs E. and F. below). A 1 family dwelling MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 8 of 28

9 may not be occupied by more than one additional family or two roomers or boarders. In a 2, 3, or 4 family dwelling, an individual family unit may not be occupied by more than two families or one family with two roomers or boarders; or 2. To the purchaser-occupant(s) who has entered into a long term installment contract for the purchase of the dwelling and who occupies the dwelling but to whom title does not pass from the seller until all the terms of the installment contract have been satisfied. The seller retains title until completion of the payments and in no way acts as a mortgagee. The seller s interest in the building and premises liability may be covered by adding the seller as an Additional Insured; or 3. To the occupant of a dwelling under a life estate arrangement when the Coverage A amount is at least 80% of the dwelling s replacement cost. The owner s interest in the building and premises liability may be covered using Additional Insured Endorsement. 4. When two or more apartment units in a 2, 3 or 4 family dwelling are occupied by co-owners, each occupying distinct living quarters with separate entrances. Given these circumstances, a Homeowners Policy providing building coverage may be issued to only one of the co-owner occupants of the dwelling. The policy may be endorsed to cover the interest of the other coowner(s) in the building and for premises liability. A separate Homeowners Policy HO-4 may be issued to the co-owner(s) occupying the other apartment(s) in the dwelling. B. Form HO-4 A Homeowner s policy may be issued to: 1. The tenant(s) (non-owner) of a dwelling or an apartment situated in any building; or 2. The owner-occupant(s) of a dwelling, cooperative unit or of a building containing an apartment not otherwise eligible for a Homeowners Policy under Paragraph A. provided the residence premises occupied by the insured is used exclusively for residential purposes (except as provided in Paragraph E.). The dwelling or apartment unit may not be occupied by more than one additional family or two boarders or roomers. C. Form HO-6 A Homeowners Policy may be issued to the owner(s) of a condominium or cooperative unit which is used exclusively for residential purposes (except as provided in Paragraphs E. and F.). The unit may not be occupied by more than one additional family or two boarders or roomers. D. Seasonal Dwelling Subject to all other sections of this rule, a Homeowners Policy may be issued to cover a seasonal dwelling. E. Permitted Business Occupancies Certain business occupancies are permitted, provided: 1. The premises is occupied principally for private residential purposes, and 2. There is no other business occupancy on the premises. F. Residence Held in Trust (All Forms Except HO 00 04) A Homeowners Policy may be issued in the name of a trust and trustee(s) when legal title to a 1 through 4 family dwelling or a condominium unit is held solely by the trust and: 1. The trustee and/or beneficiary or grantor regularly reside in the residence held in trust; and 2. The residence held in trust is used exclusively for residential purposes, except as provided in Paragraph E. MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 9 of 28

10 DEFINITIONS SEASONAL/SECONDARY RESIDENCE PREMISES A seasonal/secondary dwelling is a dwelling with continuous un-occupancy of three or more consecutive months during any one year period. Homeowners coverage on a seasonal/secondary residence premises shall be provided under a separate policy (HO3 or HO6). A seasonal/secondary residence may not be written on an HO5. Section II Coverage is mandatory for the seasonal/secondary residence policy. SINGLE AND SEPARATE BUILDINGS DEFINITION A. Single Building All buildings or sections of buildings which are accessible through unprotected openings shall be considered as a single building. B. Separate Building 1. Buildings which are separated by space shall be considered separate buildings. 2. Buildings or sections of buildings which are separated by: a. A 6 inch reinforced concrete or an 8 inch masonry party wall; or b. A documented minimum two hour noncombustible wall which has been laboratory tested for independent structural integrity under fire conditions; which pierces or rises to the underside of the roof and which pierces or extends to the inner side of the exterior wall shall be considered separate buildings. Accessibility between buildings with independent walls or through masonry, party walls as described shall be protected by at least a Class A Fire Door installed in a masonry wall section. POLICY PERIOD The policy may be written for a period of one year and may be extended for successive policy periods by extension certificate based upon the premiums, forms and endorsements then in effect for the company. CHANGES OR CANCELLATIONS A. It shall not be permissible to cancel any of the mandatory coverages in the policy unless the entire policy is cancelled. B. If insurance is increased, cancelled or reduced, the additional or return premium shall be computed on a pro rata basis, subject to the minimum premium requirement. MANUAL PREMIUM REVISION A manual premium revision shall be made in accordance with the following procedures: A. The effective date of such revision shall be as announced. B. The revision shall apply to any policy or endorsement in the manner outlined in the announcement of the revision. C. Unless otherwise provided at the time of the announcement of the premium revision, the revision shall not affect In-force policy forms, endorsements or premiums, until the policy is renewed. MULTIPLE COMPANY INSURANCE The coverages in Section I and II cannot be divided by multiple insurance companies. MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 10 of 28

11 TRANSFER OR ASSIGNMENT Subject to the consent of MAPFRE, all the rules of this Manual and any necessary adjustment of premium, a policy may be endorsed to effect: A. Transfer to another location within the same state; or B. Assignment from one insured to another in the event of transfer of title of the dwelling. WHOLE DOLLAR PREMIUM Each premium shown on the policy and endorsements shall be rounded to the nearest whole dollar. A premium of $0.50 or more shall be rounded to the next higher whole dollar. In the event of cancellation by MAPFRE, the return premium may be carried to the next higher whole dollar. ADDITIONAL INTEREST (HO or HO 04 41) A. In addition to the mortgagee(s) shown in the Declarations or elsewhere in the policy, other persons or organizations may have an insurable interest in the residence premises. When coverage is not provided to such persons or organizations under Additional Insured Endorsement or its equivalent, their interest in the residence premises may be acknowledged by naming them in the Additional Interest Residence Premises endorsement. B. Such persons or organizations are entitled to receive notification if the policy is canceled or nonrenewed by the insurer. C. No additional charge is made for use of this endorsement. INFLATION GUARD If the coverage A amount is not adjusted an annual basis,the policy will be automatically endorsed to provide a 4% annual increase of the Section I Limits of Liability as selected by the insured. Higher annual increase limits are available (6%, 8%; each additional 4%). This option is not available for forms HO-4 and HO-6. RATING PROTECTION CLASSIFICATION INFORMATION The Protection Class listings in the Public Protection Classification Manual apply to risks insured under Homeowners Program policies. A. The protection class indicated applies in a municipality or classified area where a single class of fire protection is available throughout (8, 7, 6, etc.). B. In a classified area where two or more classifications are shown (for example, 6/9), the classification is determined as follows: Distance to Fire Station 1. 5 road miles or less with hydrant within 1,000 feet * 2. 5 road miles or less with hydrant beyond 1,000 feet 9 3. Over 5 road miles 10 * First Protection Class (Ex: 6/9. Use Class 6) C. All other properties are Class 10. Class CONSTRUCTION DEFINITIONS A. Frame MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 11 of 28

12 Exterior wall of wood or other combustible construction, including wood iron-clad, stucco on wood or plaster on combustible supports, or aluminum or plastic siding over frame. B. Masonry Veneer Exterior walls of combustible construction veneered with brick or stone. C. Masonry Exterior walls constructed of masonry materials such as adobe, brick, concrete, gypsum block, hollow concrete block, stone, tile or similar materials and floors and roof of combustible construction (Disregarding floors resting directly on the ground). D. Superior Construction (any of the following or any combination thereof) 1. Non-Combustible Exterior walls and floors and roof constructed of, and supported by metal, asbestos, gypsum, or other non-combustible materials. 2. Masonry Non-Combustible Exterior walls constructed of masonry materials (as described in Paragraph C.) and floors and roof of metal or other non-combustible materials. 3. Fire Resistive Exterior walls and floors and roof constructed of masonry or other fire resistive materials. DEDUCTIBLES All policies are subject to a deductible that applies to loss from all Section I Perils. A. Base Deductible $250 Deductible B. Optional Deductibles The optional deductibles are available in amounts up to $10,000. CLAIMS EXPERIENCE Prior claims used for rating purposes must represent a substantial relationship to risk of future loss. Claims points are calculated in the same way for new and renewal business. Points are determined by cause of loss type and net paid claim amount. The total amount of points are used to determine the prior claims factor for new business and business at first or second renewal and the MIC experience claims factor for renewal business. A claim means a paid closed claim. The amount paid is the indemnity claim payment and does not include any deductible assumed by the insured. Any open loss or loss closed without payment is not considered a claim for rating purposes. Claims designated by ISO/PCS/CLUE as catastrophe losses do not trigger claims points. Claims points are assigned for the three year period ending 55 days prior to the renewal/effective date. If more than one coverage is paid on a claim it is still considered one claim for rating purposes. The total amount paid across all coverages is used to determine the number of claim points. A. Prior Claims Prior claims points are calculated for new business and subsequent renewals by adding the number of points for each prior claim as determined in the rating algorithm. B. Experience Claims Experience claims points accumulated while insured with MAPFRE are calculated for renewal business by adding the number of points for each experience claim as determined in table 4a of the rating algorithm. MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 12 of 28

13 AGE OF HOME Age of home is defined as Effective Policy Year Year Constructed. Premium is computed by applying the age of home rating factor detailed in the rating algorithm. This rating component is not utilized for forms HO-4 and HO-6. ROOF TYPE The following roof types are applicable: composition, fiberglass, gravel, rock, slate, tile, metal, wood shake, and other. Premium is computed by applying the roof type factor detailed in the rating algorithm. WILDFIRE RISK FACTOR A wildfire rating factor is applied to each policy based on the ISO Fireline score and Special Hazard Interface Area determination. Premium is computed by applying the wildfire hazard factor detailed in the rating algorithm. FORM FACTOR A rating factor is applied based on whether the policy issued is an HO-3, HO-5, HO-4, or HO-6. TOWNHOUSE OR ROW HOUSE The premium for an eligible dwelling in a townhouse or row house is computed by applying the Townhouse factor which is based on the number of individual units within the fire division and the protection class. NUMBER OF FAMILIES A 30% surcharge is applied to 3 or 4 family dwellings. HAZARD RISK The following types of hazards are applicable. A risk will be ineligible if more than one hazard is present. A. Fenced Pool or Fenced Pool with Accessories B. Trampoline or enclosed trampoline DISCOUNTS SUPERIOR CONSTRUCTION A discount is applied for dwellings or apartment units in a building of superior construction. PROTECTIVE DEVICES Approved and properly maintained installations of burglar alarms, fire alarms and automatic sprinklers in the dwelling may be recognized for a reduced premium. Properties located within a gated community or secured building may also be recognized for a reduced premium. INSURED AGE A discount is applied to the policy if the named insured is at least 55 years old. MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 13 of 28

14 MULTI-POLICY A discount is applied to the policy if named insured has a separate MAPFRE auto policy. HOME RENOVATION Discounts are available for home renovations in the following categories: plumbing, heating, cooling, electrical, and roof. The discount is dependent on the age of renovation which is defined as Policy Effective Year year renovation was completed. The following criteria must be satisfied to receive a discount: A. Plumbing - plumbing must be updated according to current local codes with new water supply lines within the structure. New plumbing fixtures and components must be installed throughout the dwelling. B. Heating The heating system must be updated according to current local codes. Complete replacement is required on burners, heating plant, and heat exchanger or heat pump. C. Cooling The entire cooling system must be updated according to current local codes. Replacement of the central air conditioning unit and a/c compressor or heat pump is required. D. Electrical Fuse and breaker boxes must be replaced according to current local codes. Replacement of switches, fixtures, wiring, and components necessary to meeting system demands is required. All wiring must be replaced in the case where aluminum wiring is present. Adding additional circuits without upgrading the entire system does not qualify. E. Roof Entire roof surface, downspouts, and gutters must be replaced. This discount does not apply for dwellings in the course of construction/renovation. A renovation will only be eligible when the age of home factor is 1.00 or greater and the renovation is completed. This information should be included in the application for new business. A memorandum certifying the year renovation was completed should be forwarded to MAPFRE for existing business. OPTIONAL COVERAGES ORDINANCE OR LAW A. Basic Limit The policy automatically provides up to 10% of the Coverage A limit of liability for forms HO-3 HO-5, and HO-6; and 10% of the Building Additions and Alterations limit for form HO-4 to pay for the increased costs necessary to comply with the enforcement of an ordinance or law. B. Increased Amount of Coverage (HO 04 77) The policy may be endorsed to increase the basic Ordinance or Law Coverage amount to accommodate the increased costs known or estimated by the insured for materials and labor to repair or replace the damaged property and to demolish the undamaged portion of damaged property and clear the site of resulting debris according to the ordinance or law. SPECIAL PERSONAL PROPERTY COVERAGE (HO and HO 17 31) 1. Coverage C - Personal Property under form HO-4 and HO-6 is insured against perils named in the form. The policy may be endorsed to insure Coverage C against additional risks of physical loss subject to certain exclusions. 2. This option may only be used when: MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 14 of 28

15 a. For Form HO-4, the apartment, dwelling or cooperative unit rented to the insured is not rented or sublet to another; or b. For Form HO-6, the condominium or cooperative unit is owner occupied and not rented to others. PERSONAL PROPERTY - REPLACEMENT COST LOSS SETTLEMENT A. Introduction The policy provides loss settlement on an Actual Cash Value basis for certain types of property. B. Loss Settlement Option (HO 04 90) The policy may be endorsed to provide loss settlement on a Replacement Cost basis for such property whether insured on a blanket or scheduled basis. Scheduled Personal Property (HO 04 61) 1. When the Scheduled Personal Property Endorsement is attached to a policy endorsed with replacement loss cost settlement, the following property, if scheduled, will also be subject to repair or replacement cost loss settlement up to the scheduled limit of liability: a. Jewelry; b. Furs and garments trimmed with fur or consisting principally of fur; c. Cameras, projection machines, films and related articles of equipment; d. Musical equipment and related articles of equipment; e. Silverware, silver-plated ware, goldware, gold-plated ware and pewterware, but excluding pens, pencils, flasks, smoking implements or jewelry; and f. Golfer s equipment meaning golf clubs, golf clothing and golf equipment. 2. The scheduled personal property endorsement will pay the insured the least of the: a. Actual cash value of the property sustaining loss; b. The amount for which the property could be repaired or replaced; or c. The amount of insurance of the property sustaining loss; the limit of liability that applies to each scheduled item should be carefully evaluated to ensure that the limit selected by the insured represents the cost to replace the item if lost or damaged beyond repair. Scheduled Personal Property (With Agreed Value Loss Settlement (HO 04 60) When Scheduled Personal Property (With Agreed Value Loss Settlement) Endorsement is attached to a policy endorsed with replacement loss cost settlement, the property subject to agreed value loss settlement will not be subject to repair or replacement cost loss settlement. ADDITIONAL AMOUNTS OF INSURANCE (HO 23 56) A. Introduction The policy provides loss settlement for buildings insured under Coverage A or B on a replacement cost basis without deduction for depreciation, if, at the time of loss, the amount of insurance on the damaged building is 80% or more of the replacement cost of the building immediately before the loss. B. Coverage Description The policy may be endorsed to provide additional insurance for Coverage A only when loss, to property insured under Coverage A - Dwelling, exceeds the limit of liability shown in the policy declarations. C. Options Available When the following option is selected, the Coverage A limit of liability shall be at least 100% of the full replacement cost of the property insured under Coverage A at policy inception or at the time the endorsement is added to the policy: 1. Specified Additional Amount of Insurance For Coverage A Only MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 15 of 28

16 a. An additional amount of insurance equal to 25% or 50% of the Coverage A limit of liability may be selected. This additional amount is available when loss to property insured under Coverage A - Dwelling exceeds the Coverage A limit of liability shown in the Declarations. The additional amount cannot be applied to any other coverage nor does it increase the Coverage A limit. D. Endorsement Exception Do not use the above endorsement when the Special Loss Settlement Endorsement or any other endorsement which modifies the required percentage of replacement value is attached to the policy. This endorsement is not available for forms HO-4 and HO-6. ACTUAL CASH VALUE LOSS SETTLEMENT WINDSTORM OR HAIL LOSSES TO ROOF SURFACING (HO 04 93) A. Introduction The policy provides settlement for building losses on a repair or replacement cost basis, subject to certain conditions. B. Coverage Description The policy may be endorsed to provide loss settlement exclusively on an Actual Cash Value basis for roof surfacing when damage is caused by the peril of Windstorm or Hail. This endorsement is not available for form HO-4. REPLACEMENT COST LOSS SETTLEMENT FOR CERTAIN NON-BUILDING STRUCTURES (HO 23 99) A. Introduction The policy provides actual cash value loss settlement for non-building structures covered under Coverage B, or specifically scheduled under this policy. B. Coverage Description The policy may be endorsed to provide repair or replacement cost loss settlement for the following types of non-building structures only if they are located on the residence premises: 1. Re-enforced masonry walls; 2. Metal or fiberglass fences; 3. Fences made of plastic/resin materials such as polyvinylchloride; 4. Patios, walks (not made of wood or wood products); and 5. Driveways. This loss settlement condition does not apply to covered property insured under Coverage B. Other Structures Away From the Residence Premises Endorsement and Specific Structures Away From the Residence Premises Endorsement. This endorsement is not available for form HO-4. COVERAGE BUNDLES MAPFRE offers a number of special coverage bundles at discounted prices. Separate bundles are available for specific Homeowners forms. The minimum limit for Coverage C liability is extended to 60% of the Coverage A amount up to a maximum value of 500,000 on the Enhanced HO-3 and HO-5 bundles. The minimum limit for Coverage C liability is extended to 70% of the Coverage A amount up to a maximum value of 625,000 on the Elite HO-5 bundle. The added features are detailed in the table below. Note: If 50% of coverage A exceeds the maximum amounts mentioned above then Coverage C liability will not be extended and we will provide the standard 50% of coverage A. MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 16 of 28

17 Coverage Enhancement Enhanced HO-3 Enhanced HO-5 Elite HO-5 Minimum Limits CovC 60% of CovA Limit (up to 500K) 60% of CovA Limit (up to 500K) 70% of CovA Limit (Up to 625K) SECTION I - ADDITIONAL LIMITS Specified Additional Limits of Liability - Coverage A (HO 23 56) 125% 125% 150% SPECIAL LIMITS OF LIABILITY Money $200 $200 $1,000 Securites $1,500 $1,500 $5,000 Watercraft $1,500 $1,500 $3,000 Trailers $1,500 $1,500 $3,000 Jewelry $1,500 $1,500 Up to $10,000 Firearms $2,500 $2,500 Up to $5,000, Includes misplaced items Silverware $2,500 $2,500 Up to $10,000 $2,500 on premises and $2,500 on premises and Up to $10,000 on $500 off premises $500 off premises premises and $5,000 off Business Property premises Electronic Apparatus $1,500 $1,500 $1,500 Additional Coverage 5% of dwelling limit up to $500 5% of dwelling limit up to $500 5% of dwelling limit up to $1,000 Trees, Shrubs and Other Plants Fire Department Service Charge $500 $500 $1,000 Credit Card $500 $500 Up to $15,000 Loss Assessment $1,000 $1,000 Up to $5,000 Landlord's Furnishings $2,500 $2,500 Up to $5,000 Ordinance or Law 10% of Coverage A 10% of Coverage A 25% of Coverage A Building Additions & Alterations N/A N/A N/A Identity Fraud None None $25,000 Lock Replacement None None 50% up to $500 Refrigerated Property $500 $500 $500 Water Backup None None Up to $15,000 included, Optional up to $50,000 Coverage C Perils Named Perils Opern Perils Open Perils Replacement Cost on Personal Property Y Y Y BUILDING ADDITIONS AND ALTERATIONS AT OTHER RESIDENCES (HO 04 49) The policy may be endorsed to provide this coverage at residences, other than the residence premises, rented to an insured. BUILDING ADDITIONS AND ALTERATIONS INCREASED LIMIT (HO 04 51) A tenant policy (HO-4) may be endorsed to provide coverage at a higher limit for an additional premium. MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 17 of 28

18 BUSINESS PROPERTY - INCREASED LIMIT (HO 04 12) A. On-Premises The $2,500 limit of liability for business property on the residence premises may be increased to $10,000 in increments of $2,500. The limit of liability in excess of $2,500 does not apply to: a. Business property in storage or held as a sample or for sale or delivery after sale. b. Business property pertaining to a business actually conducted on the residence premises. B. Off-Premises When the on-premises limit is increased, the off-premises limit of $500 is automatically increased, at no additional charge, to an amount that is 20 percent of the total on-premises limit of liability. CREDIT CARD, ELECTRONIC FUND TRANSFER CARD OR ACCESS DEVICE, FORGERY AND COUNTERFEIT MONEY (HO 04 53) The homeowner policy has a $500 limitation on a loss from fraudulent use of a credit card or electronic fund transfer card or access device; check forgery, and acceptance of counterfeit money. With the attachment of this endorsement, extra coverage for a specified limit is provided. UNIT OWNERS COVERAGE A DWELLING BASIC AND INCREASED LIMITS AND SPECIAL COVERAGE (HO 17 32) A. Basic Limits The policy automatically provides a basic Coverage A limit of $5,000 on a named perils basis. B. Increased Limits The base limits may be increased for an additional rate. UNIT OWNERS - UNITS REGULARLY RENTED TO OTHERS (HO 17 33) A. Coverage C and Section II Liability 1. There is no coverage for Coverage C - Personal Property and Section II Liability when the residence premises is regularly rented or held for rental to others. The policy may be endorsed, however, to provide such coverage, including Theft. 2. The Coverage C minimum limit of liability may be waived when the value of the insured s personal property in the rented unit is less than $10,000. PERMITTED INCIDENTAL OCCUPANCIES RESIDENCE PREMISES (HO 04 42) A. Coverage Description Coverage for a permitted incidental occupancy is limited under Section I and excluded under Section II. The policy may be endorsed to provide expanded Section I Coverage and Section II Coverage on a permitted incidental occupancy in the dwelling or in another structure on the residence premises. B. Permitted Incidental Occupancies Examples of such occupancies are Offices, Schools or Studios meaning offices for business or professional purposes, and private schools or studios for music, dance, photography and other instructional purposes. C. Other Structures If the permitted incidental occupancy is located in another structure, Coverage B does not apply to that structure. D. Personal Property MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 18 of 28

19 The permitted incidental occupancies endorsement also covers personal property pertaining to the permitted incidental occupancy within the Coverage C limits stated in the declarations. If increased Coverage C limits are desired. LOSS ASSESSMENT COVERAGE (HO 04 35) A. Residence Premises 1. Coverage Description The policy automatically provides, under Section I Additional Coverage and Section II Additional Coverage, a limit of $1,000 each for assessments relating to the residence premises, excluding assessments resulting from the peril of earthquake. 2. Higher Limits The policy may be endorsed to provide a single additional amount of insurance to be applied to one or more assessments arising out of a single loss covered under: a. Either Section I Additional Coverage or Section II Additional Coverage; or b. Both Section I and Section II Additional Coverages. B. Additional Locations 1. Coverage Description a. The policy may be endorsed to provide loss assessment coverage pertaining to additional locations for the insured s share of loss assessments arising out of a single loss covered as noted in Paragraph A.2. b. No more than 2 additional locations can be written in addition to the residence premises. LOSS OF USE INCREASED LIMIT The limit of liability for Coverage D can be increased for an additional rate per $1,000 of insurance. OTHER STRUCTURES A. On-Premises Structures (HO 04 48) When insurance is written on a specific structure on the residence premises the rates per $1,000 of insurance shall apply separately to each structure. The policy may be endorsed to provide coverage for another structure on the residence premises rented to others for dwelling purposes. B. Structures Off The Residence Premises (HO or HO 04 92) The policy automatically provides Coverage B - Other Structures on a blanket basis to structures located on the residence premises for forms HO-3 and HO-5. This blanket coverage may be endorsed to expand coverage to include structures located away from the residence premises if used in connection with the residence premises. When insurance is written on a specific structure located away from the residence premises, the rate per $1,000 of insurance shall apply separately to each location PERSONAL PROPERTY A. Coverage C Limit The limit of liability for Coverage C may be increased. B. Increased Limits - Other Residences (HO 04 50) Coverage for personal property usually located at other residences is limited in the policy form to 10% of Coverage C or $1,000, whichever is greater. This limit may be increased. C. Increased Special Limits of Liability (HO 04 65, HO 04 66, or HO 05 24) The Special Limits of Liability in the policy form for the categories of property noted in the rating algorithm may be increased. D. Refrigerated Personal Property MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 19 of 28

20 1. The policy may be endorsed to provide $500 of coverage for covered property stored in freezers or refrigerators on the residence premises for loss caused by power service interruption or mechanical failure. 2. A deductible of $100 applies. PERSONAL PROPERTY SCHEDULED (HO or HO 04 61) A. Introduction Coverage may be provided on scheduled personal property. All classes of property are subject to a minimum limit of $1,000 and a maximum limit of $10,000 with the exception of jewelry and fine arts which are subject to a maximum limit of $50,000. The most MAPFRE will pay in any one loss to any item in any class is $10,000. Breakage coverage is provided for Fine Arts but the first $100 is excluded. Appraisals are required for any agreed value schedules and on all scheduled property in excess of $25,000. B. Loss Settlement Separate endorsements are available for standard loss settlement and agreed value loss settlement. RENTAL TO OTHERS - EXTENDED THEFT COVERAGE (HO 05 41) The policy may be endorsed to insure against loss by theft to covered property when all or part of the residence premises usually occupied by the insured is occasionally rented, in whole or in part, to others, or is regularly or occasionally rented to roomers or boarders. SPECIAL COMPUTER COVERAGE (HO 04 14) The policy may be endorsed to insure computers and related equipment against additional risks of physical loss subject to certain exclusions. WATER BACK UP (HO 04 95) A. Coverage Description The policy forms exclude coverage for loss resulting from water or water-borne material which backs up through sewers or drains or which overflows or is discharged from a sump, sump pump or related equipment. B. Coverage Option The policy may be endorsed to provide such coverage for a limit of liability of up to $50,000 subject to a $250 deductible. No other deductible option is available. LANDLORDS FURNISHINGS (HO 05 46) A. Basic Limit Forms HO-3 and HO-5 automatically cover, on a named perils basis (except Theft), landlord furnishings in an apartment on the residence premises regularly rented or held for rental. The basic limit per apartment unit is $2,500 B. Increased Limits The basic limit of $2,500 may be increased in increments of $500 up to a total of $10,000 per apartment. The increased limit applies to the same perils that applies to the basic limit and may vary by rented unit. ASSISTED LIVING CARE COVERAGE (HO 04 59) A. Introduction MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 20 of 28

21 The policy provides coverage to named insureds and resident relatives who are members of the insured's household. B. Coverage Description 1. The policy may be endorsed to provide personal property, additional living expense and personal liability coverage to a person regularly residing in an Assisted Living Care facility, provided such person: a. Is related to an insured by blood, marriage or adoption; and b. Is not a member of that insured s household. 2. An assisted living care facility is a facility that provides assisted living services such as dining, therapy, medical supervision, housekeeping and social activities. It is not a hospice, prison or rehabilitation facility. 3. The endorsement provides the following basic limits of coverage: a. $10,000 for Coverage C. Personal Property with limitations ranging from $100 to $500 for certain items of property; b. $6,000, at $500 per month, for Additional Living Expenses; and c. $100,000 for Coverage E - Personal Liability. OTHER MEMBERS OF A NAMED INSURED S HOUSEHOLD (HO 04 58) A. Introduction The policy provides coverage to named insureds, resident relatives who are members of the insured s household and persons under the age of 21 who are in the care of an insured. B. Coverage Description 1. The policy may be endorsed to provide coverage to a person who is a member of the named insured s household but does not fall under the definition of insured in the policy. It does not cover a guest, residence employee, roomer, boarder or tenant. Coverage extends to the person named in the endorsement, and a person under the age of 21 who is in the legal custody of that person. 2. All coverages and provisions under Sections I and II of the policy that apply to insureds also apply to the persons described above except Coverages A, B, and D (Fair Rental Value only). MOTORIZED GOLF CART - PHYSICAL LOSS COVERAGE (HO 05 28) A. Coverage Description The policy may be endorsed to provide coverage for physical loss to a motorized golf cart, including permanently installed accessories, equipment and parts, owned by an insured. Also covered, for an amount equal to 10% of the limit of the highest scheduled cart, are accessories, equipment or parts designed or made solely for the cart that are not permanently installed provided such property is at an insured s residence or in or upon the cart off the insured s residence at the time of loss. Coverage for loss caused by collision is optional and only applies if declared on the schedule of the endorsement. B. Eligibility To be eligible for coverage, the motorized golf cart shall be of the type designed to carry up to four people on a golf course for the purpose of playing golf and shall not have been built, or modified after manufacture, to exceed a speed of 25 m.p.h. on level ground. Read the endorsement for all conditions of coverage. C. Limit Of Liability The limit of liability shall be selected by the insured. However, that limit should be representative of the actual cash value of the motorized golf cart including any permanently installed accessories, etc. D. Deductible MAPFRE Insurance Co. Includes copyrighted material of Insurance Services Office, with its permission Page 21 of 28