About This Policy TABLE OF CONTENTS. Summary of Contents:

Transcription

1 Page 1 About This Policy This is your policy for Homeowners Premier coverage, which you have purchased from Canadian Direct Insurance Incorporated ("Canadian Direct"). It is written in easy-to-understand language. Please read it carefully so you know your rights and obligations and the rights and obligations of Canadian Direct. For details of each coverage, its limitations, and the exclusions and conditions which apply, review the appropriate Sections of the policy. Summary of Contents: SECTION 1 - Introduction & Basic Agreement SECTION 2 - Definitions provides definitions of important words and insurance terms used in the policy. SECTION 3 - Your Home & Contents describes the insurance for your property. SECTION 4 - Your Personal Liability describes the insurance for your legal liability to pay compensatory damages to others. SECTION 5 - Other Coverages describes additional insurance provided by your policy. SECTION 6 - Limitations & Exclusions describes dollar limits, property that is not insured and causes of loss that are not covered. SECTION 7 - Claims describes some of the most important things you need to know if you have to make a claim. SECTION 8 - Additional & Statutory Conditions sets out additional conditions applicable to this policy. Optional Insurance describes other coverages you have purchased for an additional premium. TABLE OF CONTENTS About This Policy... 1 SECTION 1 - Introduction & Basic Agreement... 2 SECTION 2 - Definitions in this Policy... 2 SECTION 3 - Your Home & Contents... 3 What You are Insured Against... 3 Coverage A - Your Dwelling... 3 Coverage B - Other Buildings... 3 Coverage C - Personal Property... 3 Coverage D - Additional Living Expenses... 4 Extensions of Coverages A, B & C... 4 Bylaws Enforcement... 4 Change of Temperature... 4 Cleaning & Debris Removal... 4 Fire Department Charges... 4 Frozen Food Spoilage... 4 Inflation Protection... 4 Lock Replacement... 5 Outdoor Greenery... 5 Removal for Protection... 5 Safety Deposit Box... 5 Tearing Out Walls... 5 SECTION 4 - Your Personal Liability... 5 What You are Insured Against... 5 Coverage E - Legal Liability... 5 Defence of Lawsuits... 6 Supplementary Payments... 6 SECTION 5 - Other Coverages... 6 What You are Insured Against... 6 Coverage F - Abduction or Disappearance Expense... 6 Coverage G - Accidental Death... 7 Coverage H - Homeowner Association Assessment Coverage I - Credit Cards Coverage J - Headstones... 7 Coverage K - Mortgage Rate Protection... 7 Coverage L - Reward... 7 Coverage M - Voluntary Compensation for Residence Employees... 7 Coverage N - Voluntary Medical Payments... 8 Coverage O - Voluntary Payment for Damage to Property... 8 SECTION 6 - Limitations & Exclusions... 8 Property Limitations & Exclusions... 8 Liability Exclusions SECTION 7 - Claims All Claims Property Claims Liability Claims Other Coverages Claims SECTION 8 - Additional & Statutory Conditions Additional Conditions Statutory Conditions... 14

2 Page 2 Section 1 Introduction & Basic Agreement This Policy is Part of a Contract This policy is part of a contract between you and Canadian Direct. The contract includes three documents: a completed and signed Declaration of Insurance; a Summary of Homeowners Premier Insurance (the Summary); this policy. Under the contract, we agree to provide you with the insurance outlined in the Summary, for which you have agreed to pay a premium, subject to the terms and conditions set out in these documents. If we expand any coverage in this policy while this policy is in effect, you will receive the benefit of the increased coverage for the term of this policy at no additional charge. Section 2 Definitions in this Policy The following italicized words and phrases have the meanings set out below and appear throughout the policy and related documents in italics: bodily injury means bodily injury, sickness or disease or resulting death. business means any full-time or part-time activity of any kind undertaken for financial gain, and includes a trade, profession or occupation and the storage of merchandise. business property means property on which a business is conducted, property rented in whole or in part to others, or held for rental. civil authority means anyone acting under the authority of the Governor General in Council of Canada or the Lieutenant Governor in Council of a province, and/or anyone acting with authority under federal, provincial, municipal or territorial legislation with respect to the protection of people and property in the event of an emergency. domestic appliance means a device or apparatus for personal use on the premises for containing, heating, chilling or dispensing water, including, but not limited to, waterbeds, swimming pools, hot tubs, spas and aquariums. domestic partner means an unmarried opposite sex or same sex partner with whom the Insured lives together in a committed relationship. dwelling means the building, described in the Summary, occupied by you as a principal residence. earthquake means all earthquake shocks and aftershocks occurring within any consecutive one hundred and sixty-eight (168) hours during the policy period. ground water means water in the soil beneath the surface of the ground, including but not limited to water in wells, underground streams and percolating waters. occurrence means an accident or event, occurring within the policy period, to which coverage under this policy applies. Continuous or repeated exposure to the same general harmful conditions or to similar acts or omissions constitutes a single occurrence. policy period means that period of time commencing with the policy effective date and ending with the policy expiration date as shown in your Summary. premises means the land located at the address shown in your Summary and contained within the lot lines on which your dwelling is situated. Under Coverages E, M, N and O it also includes: other residential premises specified in the Summary, except business property and farms; individual or family cemetery plots or burial vaults; vacant land excluding farmland you own or rent, anywhere in Canada; land where an independent contractor is building a one or two-family residence to be occupied by you; premises you are using or where you are temporarily residing if you do not own such premises. professional service means but is not limited to: medical, surgical, dental, x-ray or nursing service or treatment, or the furnishing of food or beverages in connection therewith; any service or treatment conducive to health or of a professional nature; the furnishing or dispensing of drugs or medical, dental or surgical supplies or appliances; the handling of deceased human bodies or performing of autopsies thereon; any cosmetic, ear piercing, tonsorial, massage, physiotherapy, chiropody, hearing aid, optical or optometric service or treatments; the preparation or approval of maps, drawings, plans, opinions, reports, surveys, change orders, designs or specifications; supervisory, inspection, architectural or engineering services; or accountant s, advertiser s, lawyer s, real estate broker s or agent s, insurance broker s or agent s, travel agent s, financial institution s, or consultant s professional advices or activities. property damage means physical damage to, or destruction of, or loss of use of, tangible property. relative means anyone related to you by blood, marriage or adoption. residence employee means someone employed by you to perform duties in connection with the maintenance or use of the insured premises. This includes anyone who performs household or domestic services or duties of a similar nature for you. This does not include anyone while performing duties in connection with your business. Subject to the exclusions and conditions in this policy, specified perils means: fire or explosion; lightning; smoke; meaning smoke directly resulting from the sudden, unusual and faulty operation of a fireplace or any heating or cooking unit in or on the premises; falling object which strikes the exterior of the building; impact by aircraft or land vehicle, satellite or spacecraft; riot, vandalism or malicious acts; water damage; meaning damage caused by: the sudden and accidental escape of water from a water-main; the sudden and accidental escape of water or steam from within a plumbing, heating, sprinkler,

3 Page 3 air conditioning system or domestic appliance, which is located inside your dwelling; the sudden and accidental escape of water from a domestic appliance located outside your dwelling. However, such damage is not covered when the escape of water is caused by freezing; water which enters through an opening which has been created suddenly and accidentally by a peril insured by this policy; windstorm or hail; weight of ice, snow or sleet; transportation, meaning loss or damage directly resulting from collision, upset, overturn, derailment, stranding or sinking of any automobile or attached trailer in which the insured property is being carried. This would also apply to any conveyance of a common carrier, but does not include loss or damage to property in a vacation or home trailer which you own; theft or attempted theft; and burglary. electricity, meaning the sudden and accidental damage caused by artificially generated electricity. spouse means a person of the opposite sex who is legally married to the Insured or, a domestic partner who has been living with an Insured for at least twelve (12) consecutive months. surface waters means water on the surface of the ground where water does not usually accumulate in ordinary watercourses, lakes or ponds. unoccupied means a dwelling that is not inhabited on a daily basis. In such instances, the majority of the usual contents remains in the dwelling because you intend to return after frequent, short intervals. vacant means, regardless of the presence of furnishings, the occupant(s) has (have) moved out with no intent to return. A newly constructed dwelling is vacant after it is completed and before the occupant(s) move(s) in. Furthermore, the dwelling is also vacant when the occupant(s) move(s) out and before any new occupant(s) move(s) in. water-main means a pipe forming a part of a water distribution system, which conveys consumable water but not wastewater. we, us and our mean Canadian Direct Insurance Incorporated ("Canadian Direct"). you and your mean those people named as Insured in the Summary and, while residing in the same household, his or her spouse, the relatives of either or anyone under 21 in their care. Only the person(s) named in the above Summary may take legal action against us. Under Coverages E, M, N and O, you and your also mean: anyone legally liable for damages arising from a watercraft or animal owned by you, and to which this insurance applies. This does not include anyone using or having custody of the watercraft or animal in the course of any business or without the owner's permission; a residence employee while performing duties in connection with the ownership use or operation of motorized vehicles and trailers for which coverage is provided in this policy; if you die while insured by this policy, your legal representative thereafter, during the policy period, having temporary custody of the insured premises; anyone who is insured by this policy at the time of your death and who thereafter, during the policy period, continues residing on the insured premises. Section 3 Your Home & Contents What You are Insured Against Your property, as described in Coverages A, B and C, is insured against all risks of direct physical loss or damage, except those limited or excluded. Coverage A - Your Dwelling We insure: your dwelling and attached structures; permanently installed outdoor equipment on the premises; outdoor swimming pools, outdoor spas, outdoor hot tubs, and their attached equipment on the premises; materials and supplies, located on or adjacent to the premises, which are intended for use in construction, alteration or repair of your dwelling or of any structures on the premises; building fixtures and fittings temporarily removed from your dwelling or premises for repair or seasonal storage. Coverage B - Other Buildings We insure structures or buildings detached from your dwelling by a clear space, on your premises but not insured under Coverage A. If such structures are connected to your dwelling only by a fence, utility line or similar connection, they are considered to be detached structures. Coverage C - Personal Property On Your Premises We insure the contents of your dwelling and other personal property you own, wear or use, while it is on your premises, which is usual to the ownership or maintenance of your dwelling. If you wish, we will include uninsured personal property of others, including residence employees, while it is on that portion of your premises which you occupy. Temporarily Away from Your Premises We insure your personal property, while it is temporarily away from your premises, anywhere in the world. If you wish, we will include personal property belonging to others while it is in your possession or belonging to a residence employee travelling with or for you. However, the most we will pay is 20% of Coverage C for personal property stolen from another residence owned, rented or occupied by you unless you are residing there.

4 Page 4 We insure the personal property of a student who is enrolled in and actually attends a school, college or university and who is dependent on you or your spouse for support and maintenance while the student is temporarily residing away from the dwelling. We insure your personal property, while it is in storage. At a Newly Acquired Principal Residence We insure your personal property in transit to, and at, a newly acquired principal residence within Canada but only for 60 consecutive days from the date you begin to move property there, or until the policy period ends, whichever occurs first. In a Nursing Home We insure your personal property, and the personal property of your parents or relatives, who are in your legal custody, or who are dependent on you for support or maintenance, if living in a nursing home or a home for the aged, to a maximum of $15,000 in all. Coverage D - Additional Living Expenses The amount of insurance for Coverage D is the total amount for any one, or a combination, of the following coverages: if your dwelling is made unfit for occupancy during the policy period as a direct result of a peril insured by this policy, we will pay your moving and storage expenses, plus any increase in living expenses necessary to maintain your usual standard of living. We will pay only for the reasonable time required to repair or rebuild your dwelling, or for you to permanently settle elsewhere. if the part of your dwelling or detached structure rented to others or held for rental by you is made unfit for occupancy during the policy period as a direct result of a peril insured by this policy, we insure its fair market rent. Payment shall be for the reasonable time required to repair or replace that part of your dwelling or detached structures that is rented or held for rental. Fair market rent shall not include any expense that does not continue while that part of your dwelling or detached structures rented or held for rental is unfit for occupancy. if a civil authority prohibits access to the premises during the policy period as a direct result of damage to neighbouring premises by a peril insured by this policy, we insure any resulting additional living expenses and fair market rent loss for a period not exceeding four consecutive weeks from the date of the prohibition. we will pay any necessary and reasonable increase in living expenses that you incur while access to your dwelling during the policy period is prohibited by order of civil authority for mass evacuation directly resulting from a sudden and accidental event within Canada or the United States of America. You are insured for a period not exceeding 30 days from the date of the order of evacuation. The periods of time stated above for Coverage D are not shortened by the expiration of the policy. Extensions of Coverages A, B & C The following coverages are included in your policy. Except for Cleaning & Debris Removal, Fire Department Charges and "Inflation Protection" these coverages do not increase the amount of insurance shown in the Summary for the property damaged or destroyed. Bylaws Enforcement Following a loss to a building insured under Coverage A or Coverage B as a direct result of a peril insured by this policy, we will pay for an increase in the cost of repairs, as a result of changes or improvements you must make to comply with a bylaw regulating zoning, demolition, repair or reconstruction of the damaged buildings and structures. On payment of the claim we will increase the amount of your insurance to reflect the increase in the replacement cost of the building resulting from the mandatory improvements. Change of Temperature We insure your personal property, while in your dwelling, if it is damaged by change of temperature directly resulting from physical damage to your dwelling or equipment by a peril insured by this policy. Cleaning & Debris Removal We will pay the cost of removing the debris of property we insure that is damaged by a peril insured by this policy; removing debris blown onto your property from someone else s property, during a windstorm; removing debris that damaged the property; cleaning property we insure that is damaged by a peril insured by this policy. If the amount payable for loss, including expense for removal of debris, is greater than the amount of insurance on your dwelling or personal property, an additional 5% of that amount will be available to cover cleaning and debris removal expense. Fire Department Charges We will pay fire department charges incurred by you when a fire department attends to save or protect the property we cover from a peril insured by this policy. No deductible applies. Frozen Food Spoilage We will pay for loss of frozen food spoiled as a direct result of power failure outside your dwelling or mechanical or electrical breakdown of the food freezer unit in your dwelling, and for loss or damage to the freezer itself resulting from food spoilage, except as excluded and limited. No deductible applies. Inflation Protection During the policy period we will automatically increase the amount of insurance provided by Coverages A, B, C, and D in proportion to the increase in residential construction costs during the policy period. We will use the latest publications of Statistics Canada as our references and your premium will be amended accordingly. If, at your request, we change the amount of insurance on Your Dwelling (Coverage A) or Personal Property (Coverage C) we will apply this Inflation Protection on the changed amounts of insurance from the date the change is made.

5 Page 5 Lock Replacement We will pay to replace or re-key the locks on your dwelling and your automobile, including the ignition, if your keys are stolen. If your keys are lost, we will pay 50% of the cost. No deductible applies. Outdoor Greenery We insure outdoor trees, plants, shrubs and lawns on your premises against loss or damage directly resulting from fire, lightning, explosion, theft, impact by aircraft or land vehicle, riot, vandalism, and malicious acts. You may claim a total of up to 5% of the amount of insurance on your dwelling for these items. We will not pay more than $1,000 for any one tree, plant, or shrub including debris removal expenses. We will also reimburse you to a maximum of $500 in all for removal of trees due to a peril not covered. Removal for Protection We cover insured property that you must remove from your premises to protect it from loss or damage for up to 180 consecutive days from the date you first begin to remove it or until your policy period ends, whichever occurs first. The amount of insurance for such property is that proportion of the value of the property removed relative to the value of all property at the time of loss. Safety Deposit Box We will pay to a maximum of $10,000 in all for loss or damage to your personal property, contained in a safety deposit box at a financial institution, if the loss or damage is a direct result of a peril insured by this policy. The limit for personal property temporarily away from your premises in Section 3 and the dollar limitations contained in Section 6 do not apply to this coverage. Tearing Out Walls We will pay the cost of repairing any walls, ceilings or other parts of insured buildings or structures that must be torn apart so that water damage covered by this policy can be repaired, however, this does not include the cost of tearing out and replacing property to repair damage related to outdoor swimming pools, outdoor hot tubs, outdoor spas, or public water-mains. Section 4 Your Personal Liability What You are Insured Against You are insured for the legal liabilities described in Coverage E, except as limited or excluded. Coverage E - Legal Liability We will pay on your behalf all compensatory damages which you are required by law to pay to other persons on account of any legal liability which is insured by this policy. The maximum we will pay for all compensatory damages payable as a result of any one occurrence giving rise to your legal liability is the amount identified as the limit of insurance shown in the Summary. This maximum applies regardless of the number of: persons insured by this policy; claims made or actions brought against you; or persons making those claims or bringing those actions. You are insured for: Personal Liability - legal liability for unintentional bodily injury or property damage occurring during the policy period and arising out of your personal actions anywhere in the world during the policy period; Premises Liability - legal liability for unintentional bodily injury or property damage occurring during the policy period and arising out of your ownership, use or occupancy of the premises during the policy period; Tenant's Legal Liability - legal liability for unintentional property damage, occurring during the policy period, to premises, or their contents, which you are using, renting or have in your custody or control if the damage is caused directly by fire, explosion, water damage or smoke during the policy period; Employer's Liability - legal liability for unintentional bodily injury to your residence employees occurring during the policy period and which arises out of and in the course of their employment by you; Business Pursuits Liability - legal liability for unintentional bodily injury or property damage occurring during the policy period and arising out of: your work for someone else as a sales representative, collector, messenger, clerk or teacher, provided the claim does not involve physical disciplinary action to a student or injury to a fellow employee; the occasional rental of your dwelling to others, including the rental to others of a one or two-family dwelling usually occupied in part by you as a residence, provided that no family unit includes more than 2 roomers or boarders; the rental of space in your dwelling to others for incidental office, school or studio occupancy; the rental to others, or holding for rent, of not more than 3 car spaces or stalls in garages or stables; activities during the course of your trade, profession or occupation which are ordinarily considered to be non-business pursuits; the temporary or part-time business pursuits of an insured person under the age of 21 years; either rental of residential buildings containing not more than 6 units; or, your own use of part of your dwelling for incidental office, school or studio occupancy; if the properties or operations are declared in the Summary; Contracts or Agreements Liability - legal liability for unintentional bodily injury or property damage occurring during the policy period for which you are obligated to pay compensatory damages by reason of

6 Page 6 your assumption of liability in a written contract or agreement made before the injury or damage occurred. You are not insured under this coverage for any such liability assumed in any contract or agreement made in connection with your business; Motorized Vehicle Liability - legal liability for unintentional bodily injury or property damage occurring during the policy period and arising out of: Vehicles You Own: your ownership, use or operation of the following motorized vehicles owned by you, including their trailers or attachments, provided they are not subject to motor vehicle registration or used for compensation or hire: self-propelled lawn mowers, snow blowers, garden-type tractors or implements, used or operated mainly on your premises; motorized golf carts while used for golfing purposes; motorized wheelchairs including self-propelled scooters having more than 2 wheels and specifically used by a person who has a physical disability; and Vehicles You Do Not Own: your use or operation of any self-propelled land vehicle, amphibious vehicle or air cushion vehicle which you do not own, including their trailers, provided that: the vehicle is not subject to motor vehicle registration and is designed primarily for use off public roads; you are not using it for business or organized racing; and the vehicle is being used or operated by you with the owner's consent. You are not insured under this coverage for damage to the vehicle itself; Trailer Liability - legal liability for unintentional bodily injury or property damage occurring during the policy period and arising out of your ownership, use or operation of any trailer or its equipment, provided that such trailer is not being towed by, attached to or carried on a motorized vehicle; Watercraft Liability - legal liability for unintentional bodily injury or property damage occurring during the policy period and arising out of: Watercraft You Own: your ownership, use or operation of watercraft owned by you and equipped with an outboard motor or motors of not more than 30 h.p. in total when used with or on a single watercraft. You are also insured under this coverage if the watercraft owned by you has an inboard or an inboard-outboard motor of not more than 50 h.p. and with respect to any other type of watercraft owned by you which is not more than 26 feet in length. With respect to any additional motors or watercraft which you own and which are larger than those stated above, you are insured under this coverage only if they are shown in the Summary. This watercraft liability coverage automatically extends to any such additional watercraft you acquire after the effective date of this policy, but only for a period of 30 days from the date of acquisition or until the end of the policy period, whichever occurs first; and Watercraft You Do Not Own: your use or operation of watercraft which you do not own, provided you are not using it for business or organized racing; and the watercraft is being used or operated by you with the owner's consent. You are not insured under this coverage for damage to the watercraft itself. Defence of Lawsuits We will defend any action against you claiming compensatory damages on account of legal liability insured by this policy. We will defend any such action even if it is completely groundless. We reserve the exclusive right to appoint and instruct legal counsel in the defence and settlement of any such action as we in our absolute discretion consider appropriate. Our obligation to defend actions arising out of any one occurrence ends when we have exhausted the applicable limits of insurance under this policy in payment of judgments or settlements. Supplementary Payments With respect to all claims made or actions brought against you in respect of legal liability insured by this policy, we will pay the following sums in addition to the limit of insurance under Coverage E shown in the Summary: all expenses which we incur in respect of the investigation and defence of the claim or action; all costs taxed or assessed against you in any action we defend and which results in a judgment for legal liability insured by this policy; any interest accruing after judgment on that part of the judgment which is within the amount of insurance of Coverage E shown in the Summary; the cost of bonds required for appeals or to release property being held as security, but only up to the amount of insurance of Coverage E shown in the Summary. We are not obligated to apply for or provide these bonds; expenses you have incurred for necessary emergency medical or surgical treatment to others immediately following the occurrence; all reasonable expenses, incurred by you at our request or in respect of the investigation or defence of the claim or action, including actual loss of earnings to a maximum of $100 per day because of time you must be absent from work. Section 5 Other Coverages What You are Insured Against You are insured for the coverages described in Section 5, except as limited or excluded. Coverage F - Abduction or Disappearance Expense We will pay to a maximum of $3,000 in all, in any one policy period, for expenses directly incurred and paid by you, including the payment of any reward leading to the arrest of anyone responsible, as a result of the abduction, or disappearance beyond 24 hours, of anyone who is insured by this policy.

7 Page 7 Coverage G - Accidental Death We will pay $2,000 for the accidental death of any person insured under this policy, directly resulting from an accident. Coverage H - Homeowner Association Assessment We will pay your share of any special assessment charged against all homeowners in your homeowner association, up to the amount shown in the Summary, if it is made necessary by a direct loss to the collectively owned property caused by a peril insured by this policy. We will not pay for an assessment due to loss or damage by earthquake even if the earthquake option is shown in the Summary. We will pay to a maximum of $1,000 for an assessment made necessary by a deductible in the insurance policy of the Homeowners Association. No deductible applies. Coverage I - Credit Cards... We will pay to a maximum of $10,000 in all for: your legal obligation to pay for the unauthorized use of lost or stolen credit cards, fund transfer cards, automated teller cards, telephone calling cards, library cards and video cards, issued to you or registered in your name. We will pay only for losses which occur while this policy is in effect and which are discovered no later than one year after its cancellation or termination. You must comply with all the conditions under which the cards were issued and notify the card companies and us, as soon as you discover the loss. If a claim is made or a suit is brought against you for liability under this coverage, we will provide a defence at our expense by counsel of our choice. forced withdrawal of funds, by use of an automated teller card issued to you or registered in your name, directly resulting from holdup. any loss directly resulting from forgery or alteration of any cheque or negotiable instrument. We have the option to defend you at our expense against any suit to enforce payment under this coverage. any loss sustained through acceptance in good faith of counterfeit Canadian or United States paper currency. We may make any investigation and settle any claim or suit as we decide appropriate. Our obligation to defend any claim or suit ends when the amount we pay for the loss equals the amount of insurance. No deductible applies. Coverage J - Headstones We will pay to a maximum of $1,000 in all for loss or damage to headstones located on premises where you maintain an individual or family burial plot, but only against fire, lightning or explosion, riot or other civil commotion, impact by aircraft or land vehicle, falling object, vandalism or malicious acts, windstorm or hail. No deductible applies. Coverage K - Mortgage Rate Protection You may use this no-deductible coverage after a total loss to your dwelling. A total loss is one equal to at least the amount specified in the Summary. It must be a loss for which you are covered. Your bank or lending institution may have the right to "call in" your mortgage after a loss. If so and a new mortgage at a higher, competitive rate of interest is obtained, based on the full amortization period of the old mortgage, we will pay, in addition to the policy limits, the difference between the old and new rates on the balance of your old mortgage outstanding at the date of loss. We will pay each month. We will pay for the duration period of your old mortgage until its expiry. We will cease to pay if you relinquish title or interest in your premises. We will also pay reasonable fees charged by a lawyer to obtain the new mortgage. We will not pay for other costs such as judgments or service charges. Coverage L - Reward We will pay to a maximum of $1,500 in all to any individual or organization for information leading to the conviction of anyone who deprives you of your personal property by any criminal means. No deductible applies. Coverage M - Voluntary Compensation for Residence Employees We offer to pay the benefits described below if your residence employee is injured or dies accidentally while working for you, even though you are not legally liable. If your employee does not accept these benefits or sues you, we may withdraw our offer, but this will not affect your legal liability insurance. An employee who accepts these benefits must sign a release giving up any right to sue you. We have the right to recover from anyone, other than you, who is responsible for the employee's injury or death. An injured employee will, if requested: submit to physical examination at our expense by doctors we select as often as we may reasonably require; authorize us to obtain medical and other records. In case of death, we can require an autopsy before we make payment. We will not pay benefits: unless your employee was actually performing duties for you when the accident happened; for any hernia injury; for injury or death cased by war, invasion, act of a foreign enemy, hostilities, civil war, rebellion, revolution, insurrection or military power. "Weekly Indemnity" means two-thirds of your employee's weekly wage at the date of the accident, but we will not pay more than $125 per week.

8 Page 8 Schedule of Benefits Loss of Life If your employee dies from injuries received in the accident within the following 26 weeks, we will pay: to those wholly dependent upon him or her, a total of 100 times the weekly indemnity in addition to any benefit for Temporary Total Disability paid up to the date of death; actual funeral expenses to a maximum of $500 in all. Temporary Total Disability If your employee temporarily becomes totally disabled from injuries received in the accident within the following 14 days and cannot work at any job, we will pay weekly indemnity up to 26 weeks while such disability continues. We will not pay for the first 7 days unless the disability lasts for 6 weeks or more. Permanent Total Disability If your employee becomes permanently and totally disabled from injuries received in the accident within the following 26 weeks and cannot work at any job, we will pay weekly indemnity for 100 weeks in addition to benefits provided under Temporary Total Disability. Medical Expenses If, as a result of the accident, your employee incurs medical expenses including surgical, dental, hospital, nursing and ambulance expenses within the following 26 weeks, we will pay to a maximum of $1,000 in all in addition to all other benefits. We will pay to a maximum of $5,000 in all for the cost of supplying or renewing artificial limbs or braces, made necessary by direct result of the accident, for up to 52 weeks after the accident. Injury Benefits We do not insure you for costs recoverable from other insurance plans. If, as a result of the accident, your employee suffers the loss of, or permanent loss of use, of any of the following within 26 weeks of the accident, we will pay the sum shown opposite the incapacity in the schedule below. These benefits will be paid in addition to Temporary Total Disability Benefits but no others and for not more than 100 times the weekly indemnity. Injury Benefits Schedule The sum payable for loss or total irrecoverable loss of use of: a. Each arm or hand $10,000 b. One or more fingers $2,500 c. Each leg or foot $10,000 d. One or more toes $5,000 e. Each eye $5,000 f. Each ear $5,000 Coverage N - Voluntary Medical Payments We will pay reasonable medical, dental, surgical, ambulance, hospital, professional nursing and funeral expenses incurred within one year of the date of the accident if you unintentionally injure another person, including a residence employee, or if they are accidentally injured on your premises. This coverage can apply even though you are not legally liable. The amount of insurance shown in the Summary is the maximum amount we will pay for each person in respect of one accident or occurrence. Coverage O - Voluntary Payment for Damage to Property We will pay for direct physical damage you cause unintentionally to property, even when you are not legally liable. In addition, we will reimburse others for direct property damage caused intentionally by anyone who is 12 years of age or under and who is included in the definition of "you" or "your". Section 6 Limitations & Exclusions Limitations and Exclusions are set out under Property and under Liability. If an exclusion or limitation applies, the loss or damage is excluded or limited regardless of the cause of the excluded or limited event, other causes of the loss, or whether other causes acted concurrently or in any sequence with the excluded event to produce the loss. Property Limitations & Exclusions Accidental Discharge... We do not insure loss or damage caused, directly or indirectly, by accidental discharge or overflow of fuel from within a heating system, occurring while your dwelling is under construction or vacant, even if we have given permission for construction or vacancy. Additional Living Expenses See limitations in Section 3, Coverage D, last 2 paragraphs. Animals, Birds & Fish We insure animals, birds or fish to a maximum of $3,000 in all, and only if the loss or damage is directly caused by a specified peril other than impact by land vehicle. Automobile Spare Parts We insure automobile spare parts to a maximum of $1,000 in all. Bicycles... We insure bicycles, tricycles, or unicycles, their parts, equipment and accessories. If the loss or damage is a direct result of theft or attempted theft, we insure to a maximum of $1,000 per item, inclusive of parts, equipment and accessories. Breakage We do not insure breakage of eyeglasses, glassware, statuary, marble, bric-a-brac, chinaware, porcelain, and other fragile or brittle articles, unless caused, directly or indirectly, by a specified peril, or accident to a land vehicle, watercraft or aircraft. Business Books, Tools We insure books, tools and instruments pertaining to a business, profession, trade or occupation, other business property, and samples and goods held for sale to a maximum of $10,000 in all, only if loss or damage occurs while such property is on your premises. We do not insure business records stored electronically or books of account and evidences of debt or title. Business or Farm Use and Business Property We do not insure any buildings or structures used in whole or in part for business or farming purposes unless stated in the Summary.

9 Page 9 Coin & Stamp Collections, Manuscripts... We insure numismatic property (such as coin collections) and manuscripts, stamps and philatelic property (such as stamp collections), and collectable card and comic collections. If loss or damage is a direct result of theft or mysterious disappearance, we insure: numismatic property (such as coin collections) to a maximum of $5,000 in all; manuscripts, stamps and philatelic property (such as stamp collections) to a maximum of $5,000 in all; collectable card and comic collections to a maximum of $5,000 in all. Computer Records We will pay to re-create personal records stored in a home computer on your premises only if the loss of those records is directly caused by a peril insured under this policy. In such instances, we insure to a maximum of $5,000 in all. We do not insure the cost of gathering or assembling information or data or writing a computer programme. We will not pay to re-create business records. Credit Cards... We do not insure loss arising, directly or indirectly, out of: use of a card, described in Coverage I, for business pursuits, unless from the unauthorized use of such a card issued or registered to you and for which you are personally liable; your dishonesty; use of a card, described in Coverage I, by a resident of your household, or anyone who has been entrusted with the card(s). Domestic Animals, Birds, Vermin... We do not insure loss or damage caused directly by domestic animals, and birds, vermin, rodents, raccoons, moths, termites and insects, except resulting damage to building glass. Earthquake We do not insure loss or damage caused, directly or indirectly, by earthquake. However, we do insure additional loss or damage caused, directly or indirectly, by a peril insured by this policy (other than earthquake shock). Fairground & Exhibition Property We do not insure property at any fairground, exposition or exhibition for the purpose of competition, exhibition or sale. Faulty Material... We do not insure the cost of making good faulty material or workmanship. Illegally Acquired Property We do not insure property illegally acquired, kept, stored, transported or imported, or any property subject to forfeiture. Illegal Substances We do not insure loss or damage resulting, directly or indirectly, from any activity connected with the growth manufacture or production of any narcotic, drug, or illegal substance, including any alteration of the premises to facilitate such activity, whether or not you have any knowledge of such activity. Intentional or Criminal Acts... We do not insure loss or damage resulting, directly or indirectly, from any intentional, criminal, or insane act or failure to act by anyone insured by this policy, or anyone at their direction. This exclusion applies to all persons insured under this policy even though the act or failure to act is by only one or more of the other persons insured under this policy. Jewellery, Watches & Furs... We insure jewellery, watches, gems, fur garments and garments trimmed with fur. If loss or damage is a direct result of theft or disappearance, we insure to a maximum of $10,000 in all. Land Excavation... Following a loss to a building insured under Coverage A or Coverage B by a peril insured by this policy we will pay up to 10% of the cost of repairs or replacement of buildings, for excavation, replacement, or stabilization of land under or around your dwelling or detached structures required as a direct result of a peril insured by this policy. Lawfully Seized Property We do not insure any property lawfully seized or confiscated unless it is destroyed to prevent the spread of fire. Lease or Agreement Cancellation We do not insure loss or expense due to the cancellation of a lease or agreement. Money or Bullion We insure money or bullion to a maximum of $1,000 in all. Motorized Vehicles... We do not insure any trailers, aircraft or motorized vehicles, or their equipment, except utility trailers to a maximum of $3,000 in all. We insure watercraft trailers as described below, motorized lawn mowers, garden tractors and snow blowers, motorized wheelchairs and invalid chairs, and golf carts while being used for golfing purposes. Equipment does not include automobile spare parts. Nuclear Incident We do not insure loss or damage caused directly or indirectly by any nuclear incident as defined in the Nuclear Liability Act, nuclear explosion or contamination by radioactive material. Personal Property See limitations in Section 3, Coverage C, last 3 paragraphs

10 Page 10 Pollution We do not insure any loss caused, directly or indirectly, by any pollution or contamination to land, water or air, including the cost of complying with any request, demand or order that anyone or any entity test for, mitigate or eliminate such pollution or contamination. Property Undergoing Process We do not insure loss or damage to property undergoing any process or while being worked on, where the damage results, directly or indirectly, from such process or work, but resulting damage to other property is insured. Roomers & Boarders... We do not insure the property of tenants, roomers and boarders not related to you. Securities We insure securities to a maximum of $7,000 in all. Settling, Expansion, Contraction... We do not insure loss or damage caused, directly or indirectly, by settling, expansion, contraction, moving, bulging, buckling or cracking, except resulting damage to building glass. Smoke We do not insure loss or damage caused, directly or indirectly, by smoke from agricultural smudging or industrial operations. Snowslide, Landslide... We do not insure loss or damage caused by snowslide, landslide, mudslide, rockslide or other earth movement. If any of these results in fire or explosion, we will pay for the loss or damage directly resulting only from the fire or explosion. Sporting Equipment We insure sporting equipment only if the loss or damage is not caused as a result of its use. Swimming Pools, Hot Tubs, Spas... We do not insure loss or damage to an outdoor swimming pool, outdoor hot tub, outdoor spa, or equipment attached, and which is caused, directly or indirectly, by water damage, rupture or freezing. Tenant-Related Loss or Damage... We do not insure loss or damage caused, directly or indirectly, by theft, attempted theft, vandalism or malicious acts by any tenant, member of the tenant's household or employee of the tenant. Theft from Dwelling Under Construction We do not insure theft of any property from a dwelling under construction, including materials and supplies located on or adjacent to the premises intended for use in construction, alteration, or repair of your dwelling. If the theft or attempted theft results in loss or damage by fire, explosion or water, we insure that portion of the damage caused directly by these perils. Vacant or Unoccupied Dwelling We do not insure loss or damage occurring after your dwelling has been vacant or unoccupied for more than 30 consecutive days. Vandalism or Malicious Acts... We do not insure loss or damage caused, directly or indirectly, by vandalism or malicious acts or glass breakage occurring while your dwelling is under construction or vacant even if permission for construction or vacancy has been given by us. War... We do not insure loss or damage resulting directly or indirectly from war, invasion, act of foreign enemy, hostilities, civil war, rebellion, revolution, insurrection or military power. Watercraft We insure watercraft, their trailers, furnishings, equipment, accessories and motors to a maximum of $4,000 in all. Loss or damage caused, directly or indirectly, by windstorm or hail, is insured, also to a maximum of $4,000 in all, provided the property is inside a fully enclosed building at the time of the loss. Water Damage We do not insure loss or damage caused by water unless the loss or damage resulted from: the sudden and accidental escape of water from a water-main; the sudden and accidental escape of water or steam from within a plumbing, heating, sprinkler or air conditioning system or domestic appliance, which is located inside your dwelling; the sudden and accidental escape of water from a domestic appliance located outside your dwelling but such damage is not covered when the escape of water is caused by freezing; water which enters through an opening which has been created suddenly and accidentally by a peril insured by this policy; water from the accumulation of ice or snow on the roof or eavestrough, which enters your dwelling through a roof; the backing-up or escape of water from a sewer, storm drain, drain, sump or septic tank, subject to the limitation indicated in the Summary; but we do not insure loss or damage: caused by continuous or repeated seepage or leakage of water; caused by ground water or rising of the water table; caused by surface waters, unless the water escapes from a water-main; caused by flood, spray, waves, tides, tidal waves, tsunami, ice or waterborne objects; whether driven by wind or not, unless the loss or damage resulted directly from the escape of water from a swimming pool, hot tub, spa, public water-main, or equipment attached; to a water-main; to a system or domestic appliance from which the water escaped; occurring while the building is under construction or vacant even if we have given permission for construction or vacancy; caused by freezing of any part of a plumbing, heating, sprinkler or air conditioning system or domestic appliance, unless it happens within a building heated during the usual heating season and you have not been away from your premises for more than seven (7) consecutive days. However if you had arranged for a competent person to enter your dwelling daily to ensure heating was being maintained or if you had shut off the water supply and had drained all the pipes and appliances, you would still be insured.

11 Page 11 Wear & Tear, Mechanical Breakdown, Marring & Scratching... We do not insure loss or damage caused directly or indirectly by wear and tear, deterioration, latent defect, inherent vice, mechanical breakdown, design, imminent collapse, rust, corrosion, condensation, extremes of temperature, dampness, wet or dry rot, mildew, mould, fungus, contamination, staining or discoloration. We do not insure marring and scratching of any property unless caused directly by a specified peril, or accident to a land vehicle, watercraft or aircraft. Liability Exclusions Abuse, Harassment, Molestation... from actual or alleged sexual, physical, psychological or emotional abuse, molestation, harassment or assault by, at the direction of, or with the knowledge of anyone insured by this policy. Aircraft... from the ownership, use, maintenance or operation of any aircraft or of any premises used for the purposes of an airport or landing facility. Business Activities from the business of, or any business use of your premises by, anyone insured by this policy except as expressly permitted in this policy. Communicable Disease from the transmission of a communicable sickness or disease by anyone insured by this policy. Computer Data You are not insured under Coverage E, N or O for any from the transmission of data of any sort, including viruses, on a computer network or the Internet. Defamation You are not insured under Coverage E, M or N for any from any form of defamation. Illegal Substances legal liability or payment for bodily injury or property damage resulting, directly or indirectly, from any activity connected with the growth, manufacture or production of any narcotic, drug or illegal substance. Injury to Other Insureds from bodily injury to anyone insured by this policy, other than a residence employee. Intentional or Criminal Act legal liability or payments arising, from bodily injury or property damage caused, directly or indirectly, by any intentional or criminal act or failure to act by, or at the direction of, anyone insured by this policy. This exclusion applies to all persons insured under this policy even though the intentional or criminal act or failure to act is by only one or more of the other persons insured under this policy. Medical Expenses You are not insured under Coverage N for expenses covered by any medical, dental, surgical or hospitalization plan or law, or under any other insurance contract; your medical expenses or those of anyone residing with you, other than residence employees or medical expenses of anyone covered by any workers' compensation statute. Motorized Vehicles, Trailers, Watercraft from the ownership, use or operation of any motorized vehicle, trailer or watercraft except those for which coverage is expressly provided by this policy. Nuclear Liability from bodily injury or property damage which is also insured under a nuclear energy liability policy or would be insured if the limits of that policy had not been exhausted or the policy terminated. Pollution from any pollution, mould, fungus, or contamination to land, water or air, including the cost of complying with any request, demand or order that anyone or any entity test for, mitigate or eliminate such pollution or contamination. Professional Service from the provision or failure to provide any professional service. Property Damage from property damage: to property owned, used, occupied or leased by anyone insured by this policy or their tenants; to property which is in the care, custody or control of anyone insured by this policy; to personal property or fixtures resulting from work done on them by or on behalf of anyone insured by this policy; which is also insured under Section 3 of this policy; or which is caused by disappearance or theft.

12 Page 12 Punitive, Exemplary Damages... You are insured under Coverage E only for legal liability to pay compensatory damages. You are not insured under this coverage for any legal liability you may have for punitive or exemplary damages, injunctive relief or any form of judicial remedy other than compensatory damages. Tenant's Legal Liability legal liability arising from any contract unless you would be legally liable even if no contract had been in force. War... from war, invasion, act of a foreign enemy, hostilities, civil war, rebellion, revolution, insurrection or military power. Watercraft from the ownership, use or operation of any jet-propelled watercraft, including, but not limited to, Sea-Doos, WaveRunners, Jet Skis, etc. Workers' Compensation from any workers' compensation statute. Section 7 Claims All Claims Insurance Under More Than One Policy If there is other insurance or any valid warranty which applies to a loss or claim, or would have applied if this policy did not exist, our policy will be considered as "excess insurance" and we will not pay any loss or claim until the amount of that other insurance or warranty has been exhausted. Right of Recovery from Others If we make any payment under this policy, we assume all your rights of recovery against others who may be responsible for the loss or damage and you are obliged to do whatever is reasonably necessary to assist us in pursuing such recovery. In that regard, we may take legal action in your name to enforce any right of recovery. If you were uninsured for any part of the loss, we will share the amount we recover with you proportionately, after deducting all of our recovery expenses. Property Claims Notice to Police Where the loss is caused by actual or attempted malicious acts, burglary, robbery, theft, or is suspected to be caused by such acts, you shall immediately notify the police or other appropriate authorities and you shall notify us as soon as possible. Financial Interest We will pay all claims for insured loss or damage up to your financial interest in the property, but not exceeding the applicable amount(s) of insurance set out in your Summary for any loss or damage arising out of one occurrence, subject, however, to the provisions of the Guaranteed Replacement Cost clause, below. Your Dwelling and Other Buildings - Guaranteed Replacement Cost In the event of an insured loss to your premises we will pay the full replacement cost regardless of the limit shown in the Summary. This applies only if: you insure your dwelling to 100% of the replacement cost using a home evaluation method acceptable to us; you accept any yearly adjustments we may make in accordance with the Inflation Protection extension in Section 3 of the policy; you choose within 60 days, to rebuild, repair or replace your dwelling and detached structures on the same site with material of like kind and quality; you notify us within 90 days of the start of construction if you make additions or improvements that increase the replacement cost of your dwelling by 5% or more. If you do not comply fully with the above conditions then property losses are paid as follows: buildings under Coverages A and B of Section 3 for the cost to repair or replace, whichever is less, with materials of similar kind and quality without deduction for depreciation provided; any partial loss or damage to the dwelling is repaired or replaced within 180 days from the date of loss, otherwise we will only pay the cost of repair or replacement less depreciation; any replacement of the building(s) takes place on the same site. If you do not repair, replace, or rebuild your dwelling or other detached structures at the same location, we will pay the reconstruction cost of your dwelling and detached structures up to the amount of coverage shown in your Summary whether or not you actually repair, replace, or rebuild. Your Personal Property - Replacement Cost In the event of loss insured by Coverage C we will pay the full cost of repair or replacement, whichever is less, with materials of similar kind and quality, without deduction for depreciation. However, we will not pay more than the Actual Cash Value at the time of the loss: for property no longer in use for its originally intended purpose; if the damaged article was not in working order or was obsolete before the loss. Single Inclusive Limit In the event of loss, if the limit of your insurance shown in the Summary, plus any increase because of the Inflation Protection extension, applicable to any of the Coverages A, B, C or D, is used up, you may apply the unused amount of the remaining coverages under Section 3 to cover your loss, until the total of all coverages under Section 3 has been used up. If, however, the amount payable for a building exceeds the limit for Coverage A, shown in the Summary, then this Single Inclusive Limit provision applies only among the separate limits for Coverages B, C and D. Deductible We will pay only the amount by which the insured loss or damage exceeds the applicable deductible amount in any one occurrence. However, if your claim exceeds $10,000, any applicable deductible up to and including $500 will no longer apply.

13 Page 13 If your claim involves personal property affected by special limits, as detailed in Section 6, those limits apply only to the amount of loss over and above the deductible. Actual Cash Value Actual Cash Value takes into account such things as the cost of replacement less any depreciation. In determining depreciation we will consider the condition immediately before the damage, the resale value, obsolescence and normal life expectancy. Duty to Recover If any property insured under this policy is lost, it is your duty to take all reasonable steps to recover such property. We will contribute towards any reasonable and proper recovery expenses proportionately to your financial interest in the property or the amount of coverage under your policy. Pairs & Sets In the case of insured loss of or damage to any article or articles which are a part of a set, the measure of loss will be a reasonable and fair proportion of the total value of the set. Parts In the case of insured loss of or damage to any part of property that consists of several parts when complete for use, we will pay only for the insured value of the part that is lost or damaged, including the cost of installation. Reinstatement Any payment made for loss or damage shall not reduce the amounts of insurance provided by this policy. Liability Claims Your Duty to Report Occurrences When an occurrence takes place which may give rise to legal liability insured by this policy, you must give us immediate notice (in writing if we so require) including, your name and policy number; the time, place and circumstances of the occurrence; and the names and addresses of all witnesses and potential claimants. Investigation and Defence of Claims or Actions We reserve the right to investigate, negotiate and settle any claims or actions in respect of liability insured under this policy as we deem fit. In that regard, upon our request, you will help us obtain witnesses, information and evidence about the occurrence and comply with all requests for assistance in the investigation and defence of the claim or action; you will immediately send us everything you receive in writing from other persons concerning the occurrence, claim or action, including all legal documents; and except for expenses for necessary emergency medical or surgical treatment to others immediately following the occurrence, you will not voluntarily make any payment or settlement, assume any obligations or incur any expenses with respect to any occurrences or any resulting claim or action. Defence of Lawsuits See Section 4 - Your Personal Liability Supplementary Payments See Section 4 - Your Personal Liability Other Coverages Claims Notice to Police and Us - Coverage F - Abduction or Disappearance Expense As a condition of this coverage, any such abduction or disappearance must be reported by you to the police and us as soon as possible. Your Duties After An Accident - Coverage N - Voluntary Medical Payments You shall arrange for anyone who is injured to: give us written proof of claim, under oath if necessary, as soon as possible; submit to physical examinations at our expense by doctors we select. Several such examinations may be required; authorize us to obtain medical and other records. Proofs and authorizations may be given by someone acting on behalf of anyone who is injured. Your Duties After An Accident - Coverage O - Voluntary Payment for Damage to Property Within 60 days after the loss, you must give us, under oath if required, a Proof of Loss Form listing: the amount, place, time and cause of loss; the interest of everyone in the property affected; and the actual cash value of the property at the time of loss. If necessary, you must help us verify the damage. Basis of Payment - Coverage O - Voluntary Payment for Damage to Property We will pay whichever is the least of the following: the Actual Cash Value of the property at the time of loss; what it would cost to repair or replace the property with materials of similar quality to those in place at the time of loss; or the amount shown in the Summary. We may pay for the loss in money or may repair or replace the property, and we may settle any claim for loss of property either with you or with the owner of the property. We may take over any salvage if we wish. Section 8 Additional & Statutory Conditions The insurance under this policy is subject to the following Additional and Statutory Conditions: Additional Conditions Legal Action Against Us - Coverage E - Legal Liability You shall not bring suit against us until you have fully complied with all terms of this policy, nor until the amount of your legal obligation to pay compensatory damages has been finally determined either by judgment against you or by an agreement which has our consent.

14 Page 14 Legal Action Against Us - Coverage N - Voluntary Medical Payments & Coverage O - Voluntary Payment for Damage to Property You shall not bring suit against us until you have fully complied with all the terms of this policy, nor until 60 days after the required Proof of Loss Form has been filed with us. No Benefit to Others No person or organization having custody of the property and to be paid for services shall benefit from this insurance. Standard Mortgage Clause The insurance under this policy is subject to the following clause: It is hereby provided and agreed that: 1. Breach of Conditions By Mortgagor, Owner or Occupant This insurance and every documented renewal thereof - as to the interest of the mortgagee only therein - is and shall be in force notwithstanding any act, neglect, omission or misrepresentation attributable to the mortgagor, owner or occupant of the property insured, including transfer of interest, any vacancy or nonoccupancy, or the occupation of the property for purposes more hazardous than specified in the description of the risk; Provided always that the Mortgagee shall notify forthwith the Insurer (if known) of any vacancy or non-occupancy extending beyond thirty (30) consecutive days, or of any transfer of interest or increased hazard that shall come to his knowledge; and that every increase of hazard (not permitted by the policy) shall be paid for by the Mortgagee - on reasonable demand - from the date such hazard existed, according to the established scale of rates for the acceptance of such increased hazard, during the continuance of this insurance. 2. Right of Subrogation Whenever the Insurer pays the Mortgagee any loss award under this policy and claims that - as to the Mortgagor or owner - no liability therefor existed, it shall be legally subrogated to all rights of the Mortgagee against the Insured, but any subrogation shall be limited to the amount of such loss payment and shall be subordinate and subject to the basic right of the Mortgagee to recover the full amount of its mortgage equity in priority to the Insurer; or the Insurer may at its option pay the Mortgagee all amounts due or to become due under the mortgage or on the security thereof, and shall thereupon receive a full assignment and transfer of the mortgage together with all securities held as collateral to the mortgage debt. 3. Other Insurance If there be other valid and collectible insurance upon the property with loss payable to the Mortgagee - at law or in equity - then any amount payable thereunder shall be taken into account in determining the amount payable to the Mortgagee. 4. Who May Give Proof of Loss In the absence of the Insured, or the inability, refusal or neglect of the Insured to give notice of loss or deliver the required proof of loss under the policy, then the Mortgagee may give the notice upon becoming aware of the loss and deliver as soon as practicable the Proof of Loss. 5. Termination The term of this Mortgage Clause coincides with the policy period; provided always that the Insurer reserves the right to cancel the policy as provided by Statutory provision but agrees that the Insurer will neither terminate nor alter the policy to the prejudice of the Mortgagee without the notice stipulated in such Statutory provision. 6. Foreclosure Should title or ownership to said property become vested in the Mortgagee and/or assigns as owner or purchaser under foreclosure or otherwise, this insurance shall continue until expiry or cancellation for the benefit of the said Mortgagee and/or assigns. Subject to the terms of this mortgage clause (and these shall supersede any policy provisions in conflict therewith but only as to the interest of the Mortgagee), loss under this policy is made payable to the Mortgagee. Waiver No waiver or change of any provision of this policy may be made except by us in writing. A waiver of any provision of this policy does not invalidate or change any other provision of the policy. Except as provided herein, all the terms and conditions of this policy shall have full force and effect. Statutory Conditions The following conditions are not in plain language form. They are drawn from The Insurance Act of British Columbia as found in the 1996 Revised B.C. Statutes. 1. Misrepresentation If any person applying for insurance falsely describes the property to the prejudice of the insurer, or misrepresents or fraudulently omits to communicate any circumstance which is material to be made known to the insurer in order to enable it to judge of the risk to be undertaken, the contract is void as to any property in relation to which the misrepresentation or omission is material. 2. Property of Others Unless otherwise specifically stated in the contract, the insurer is not liable for loss or damage to property owned by any person other than the insured, unless the interest of the insured in it is stated in the contract. 3. Change of Interest The insurer is liable for loss or damage occurring after an authorized assignment under the Bankruptcy Act or change of title by succession, by operation of law, or by death. 4. Material Change Any change material to the risk and within the control and knowledge of the insured avoids the contract as to the part affected by the change, unless the change is promptly notified in writing to the insurer or its local agent; and the insurer 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 the insured desires the contract to continue in force, the insured must, within 15 days of the receipt of the notice, pay to the insurer an additional premium; and in default of such payment the contract is no longer in force and the insurer must return the unearned portion, if any, of the premium paid. 5. Termination (1) This contract may be terminated: (a) by the insurer giving to the insured 15 days' notice of termination by registered mail, or 5 days written notice of termination personally delivered, or (b) by the insured at any time on request. (2) If this contract is terminated by the insurer: (a) the insurer must refund the excess of premium

15 Page 15 actually paid by the insured over the proportionate premium for the expired time, but, in no event, is the proportionate premium for the expired time to be less than any minimum retained premium specified, and (b) the refund must accompany the notice unless the premium is subject to adjustment or determination as to amount, in which case the refund must be made as soon as practicable. (3) If this contract is terminated by the insured, the insurer must refund as soon as practicable, the excess of premium actually paid by the insured over the short rate premium for the expired time, but, in no event must the short rate premium for the expired time be deemed to be less than any minimum retained premium specified. (4) The refund may be made by money, postal or express company money order, or by cheque payable at par. (5) The 15 days mentioned in clause (a) of subcondition (1) commences to run on the day following the receipt of the registered letter at the post office to which it is addressed. 6. Requirements After Loss (1) On the occurrence of any loss of or damage to the insured property, the insured must, if such loss or damage is covered by the contract, in addition to observing the requirements of conditions 9, 10 and 11, (a) forthwith give notice of it in writing to the insurer, (b) deliver as soon as practicable to the insurer a proof of loss verified by a statutory declaration, (i) giving a complete inventory of the destroyed and damaged property and showing in detail quantities, costs, actual cash value and particulars of amount of loss claimed, (ii) stating when and how the loss occurred, and if caused by fire or explosion due to ignition, how the fire or explosion originated, so far as the insured knows or believes, (iii) stating that the loss did not occur through any wilful act or neglect or the procurement, means or connivance of the insured, (iv) showing the amount of other insurances 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 title, use, occupation, location, possession or exposures of the property since the issue of the contract, and (vii) showing the place where the property insured was at the time of loss, (c) if required give a complete inventory of undamaged property and showing in detail quantities, cost, actual cash value, and (d) if required and if practicable, produce books of account, warehouse receipts and stock lists, and furnish invoices and other vouchers verified by statutory declaration, and furnish a copy of the written portion of any other contract. (2) The evidence furnished under clauses (c) and (d) of subparagraph (1) of this condition must not be considered proofs of loss within the meaning of conditions 12 and Fraud Any fraud or wilfully false statement in a statutory declaration in relation to any of the above particulars vitiates the claim of the person making the declaration. 8. Who May Give Notice and Proof Notice of loss may be given, and proof of loss may be made, by the agent of the insured named in the contract in case of absence or inability of the insured to give the notice or make the proof, and absence or inability being satisfactorily accounted for, or in the like case, or if the insured refuses to do so, by a person to whom any part of the insurance money is payable. 9. Salvage (1) The insured, in the event of any loss or damage to any property insured under the contract, must take all reasonable steps to prevent further damage to any such property so damaged and to prevent damage to other property insured under this contract including, if necessary, its removal to prevent damage or further damage to it. (2) The insurer must contribute proportionately towards any reasonable and proper expenses in connection with steps taken by the insured and required under subparagraph (1) of this condition according to the respective interests of the parties. 10. Entry, Control, Abandonment After any loss or damage to insured property, the insurer has an immediate right of access and entry by accredited agents 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, but the insurer is not entitled to the control or possession of the insured property, and without the consent of the insurer there can be no abandonment to it of insured property. 11. Appraisal In the event of disagreement as to the value of the property insured, the property saved, or the amount of the loss, those questions must be determined by appraisal as provided under the Insurance Act before there can be any recovery under this contract, whether the right to recover on the contract is disputed or not, and independently of all other questions; but there is no right to an appraisal until a specific demand for it is made in writing and until after proof of loss has been delivered. 12. When Loss Payable The loss is payable within 60 days after completion of the proof of loss, unless the contract provides for a shorter period. 13. Replacement (1) The insurer, instead of making payment, may repair, rebuild, or replace the property damaged or lost, giving written notice of its intention so to do within 30 days after receipt of the proofs of loss.

16 Page 16 (2) In that event the insurer must commence to so repair, rebuild or replace the property within 45 days after receipt of the proofs of loss, and after that must proceed with all due diligence to the completion of the repair, rebuilding or replacement. 14. Action Every action or proceeding against the insurer for the recovery of any claim under or by virtue of this contract is absolutely barred unless commenced within one year next after the loss or damage occurs. 15. Notice (1) Any written notice to the insurer may be delivered at, or sent by registered mail to, the chief agency or head office of the insurer in British Columbia. (2) Written notice may be given to the insured named in this contract by letter personally delivered to the insured or by registered mail addressed to the insured at the insured s latest post office address as notified to the insurer and in this condition the expression "registered" means registered in or outside Canada.