American Integrity Insurance Company of Florida

Transcription

1 American Integrity Insurance Company of Florida Voluntary Dwelling Property Program- FLORIDA Voluntary Dwelling DP-3 Special Form 7/30/2013 American Integrity Insurance Group

2 Table of Contents UNDERWRITING GUIDELINES BINDING AUTHORITY... 6 HURRICANE - TROPICAL STORM SUSPENSION... 7 ELIGIBILITY - UNDERWRITING... 7 GENERAL... 7 INELIGIBLE RISKS... 8 General Characteristics... 8 Property Features... 9 Property Condition... 9 Liability Exposure(s)... 9 Property Value(s) or more than one home on the property Applicant characteristics and Loss History GENERAL RULES APPLICANT AGE OF HOME (NEW BUSINESS AND RENEWAL) Greater than 30 years CANCELLATION OR REDUCTIONS IN LIMITS OF LIABILITY OR COVERAGE INSURANCE SCORE GUIDELINES LAPSE IN COVERAGE/NO PRIOR INSURANCE MULTIPLE COMPANY INSURANCE OCCUPANCY/USE POLICY TERM PRIOR CANCELLATIONS/NON-RENEWALS PROPERTIES DEEDED IN AN LLC (LLC, TRUST OR CORPORATION) RENEWAL PLAN ROOF (NEW AND RENEWAL BUSINESS) SECONDARY/SEASONAL RESIDENCES SWIMMING POOLS (NEW AND RENEWAL BUSINESS) TOWN OR ROW HOUSE TRAMPOLINES (NEW AND RENEWAL BUSINESS) TRANSFER OR ASSIGNMENT WAIVER OF PREMIUM WHOLE DOLLAR PREMIUM RULE INSURANCE TO VALUE Voluntary Dwelling April 2013 Page 2

3 BINDING AUTHORITY LIMITS/PROGRAM DESCRIPTION CONSTRUCTION DEFINITIONS MANDATORY ENDORSEMENTS AIIC DP 09 SP Special Provisions - Florida AIIC DP 09 SPL Special Provisions Liability AIIC DP 09 HD - Calendar Year Hurricane Deductible with Supplemental Reporting Requirement- Florida AIIC DP DO Deductible Options Notice AIIC DP 09 TL - Trampoline Liability Exclusion AIIC DP 09 FCE - Limited Fungi, Mold, Wet or Dry Rot, or Bacteria Coverage Endorsement AIIC DP Windstorm Exterior Paint or Waterproofing Exclusion- Seacoast- Florida AIIC DP 09 WD Water Damage Exclusion Endorsement DL Limited Fungi, Wet or Dry Rot, or Bacteria Coverage DL Personal Liability DL Premises Liability DL No Coverage for Home Day Care Business MANUAL PREMIUM REVISION MINIMUM AND MAXIMUM VALUE MINIMUM PREMIUM MULTIPLE LOCATIONS PROPERTIES LOCATED ON MORE THAN 5 ACRES IN A PC 9/10 OR A PC 10 PROPERTY PROPERTIES WITH FARM ANIMALS OR HORSES (NOT ON A FARM) PROTECTED SUBDIVISION RULE PROTECTION CLASS COVERAGE OPTIONS ADDITIONAL INSURED ADDITIONAL INTERESTS BUSINESS PURSUITS [NO COVERAGE] COVERAGE B - OTHER STRUCTURES DECREASED OR INCREASED LIMITS COVERAGE C PERSONAL PROPERTY DEDUCTIBLES HOME SYSTEMS PROTECTION AND SERVICE LINE COVERAGE INCREASED LIABILITY COVERAGE LIMITS INFLATION GUARD LIMITED FUNGI, MOLD, WET OR DRY ROT, OR BACTERIA COVERAGE ENDORSEMENT LIMITED THEFT COVERAGE LIMITED WATER DAMAGE ENDORSEMENT LOSS ASSESSMENT COVERAGE ORDINANCE OR LAW COVERAGE Voluntary Dwelling - July 2013 Page 3

4 OTHER INSURED LOCATION [NO COVERAGE] PERMITTED INCIDENTAL OCCUPANCIES PERSONAL PROPERTY REPLACEMENT COST (NOT AVAILABLE FOR POLICIES EXCLUDING CONTENTS) SINKHOLE LOSS COVERAGE- FLORIDA WATER DAMAGE EXCLUSION ENDORSEMENT WIND OR HAIL- SCREEN ENCLOSURES AND CARPORTS (NOT AVAILABLE FOR POLICIES EXCLUDING WIND COVERAGE) WINDSTORM OR HAIL EXCLUSION- FLORIDA PREMIUM CALCULATIONS AMOUNT OF INSURANCE AGE OF DWELLING BUILDING CODE EFFECTIVENESS GRADING Community Grading Individual Grading Ungraded and Nonparticipating Risks PROTECTION CLASS/CONSTRUCTION TOWN OR ROW HOUSE DISCOUNTS/SURCHARGES PREMIUM FACTORS - NON HURRICANE BASE RATE BOOK TRANSFER DISCOUNT HARDIPLANK SIDING DISCOUNT LAPSE IN COVERAGE/ NO PRIOR INSURANCE SURCHARGE OPEN FOUNDATION SURCHARGE PROTECTIVE DEVICES DISCOUNT SECURED COMMUNITY/BUILDING DISCOUNT SENIOR/RETIREE DISCOUNT PREMIUM FACTORS - HURRICANE BASE RATE Windstorm Loss Mitigation Features A. Eligibility B. Mitigation Credit Tables C. Verification D. Definitions of Terms ADDITIONAL FEES EMERGENCY MANAGEMENT PREPAREDNESS AND ASSISTANCE TRUST FUND SURCHARGE (EMPATF) MANAGING GENERAL AGENCY (MGA) FEE FLORIDA INSURANCE GUARANTY ASSOCIATION (FIGA) FEE PAYMENT PLAN OPTIONS GENERAL RULES PAYMENT PLANS Voluntary Dwelling - July 2013 Page 4

5 FORMS TERRITORY BASE RATES TERRITORY DEFINITIONS BY ZIP CODE RATE CALCULATION WORKSHEET Voluntary Dwelling April 2013 Page 5

6 BINDING AUTHORITY Agents have the authority to bind coverage on any risk that is not identified as "ineligible" in the Ineligible Risks section of this underwriting guide. Agent's authority is for the limits stated and outlined in the various sections of this guide. Any exceptions must be referred to the American Integrity Insurance Company (herein after referenced as the Company or AIIC) for approval prior to binding. A dwelling replacement cost estimator must be completed. The amount of coverage carried on the dwelling shall be one hundred percent (100%) of the current replacement cost or Actual Cash Value (80%) at inception or renewal. All new business submissions must use forms approved by the Company and must be signed by the insured. Applications must be fully complete and payment must be submitted to the Company within 5 business days of binding. Original signed applications and all other required documentation must be maintained in the agent's files. The only exceptions are 4 Point Inspections (for homes over 30 years of age) and Wind Mitigation Inspections (for homes built 2001 or prior) which must be submitted to the Company if Replacement Cost coverage on the Dwelling and Limited Water Coverage is requested. The Company will perform periodic audits of the agent's files to ensure compliance with all rules and guidelines. Note: Section of the Florida Statutes provides that any misrepresentation of material fact, omission or incorrect statement on an application for coverage may prevent recovery under the policy. All risks are subject to an inspection to confirm replacement cost values and/or insurability. The applicant must provide the name and phone number of the person responsible for securing access to both the interior and exterior of the dwelling, including arranging for permission to enter a gated/guarded community. Any requests to increase/decrease coverage may need to be submitted to underwriting. Submissions may require information other than that shown on the application. Agents should obtain any information that helps support acceptance of the request being submitted, especially when the information calls for more explanation or when this manual indicates that additional information is required. Such cases include but are not limited to: Documentation of updates to roofing, heating, wiring, plumbing, etc. Determination of replacement cost or Actual Cash Value Evidence of National Flood Insurance Program (NFIP) coverage, if required Evidence of Wind Mitigation features, hip roof and/or Opening Protection For renewal business, the Company has the option to perform an annual inspection to verify correct insurance to value, confirm rating variables such as construction type, and determine if there have been changes in exposure or increased hazards. AIIC will pay the inspection fee on renewal inspections. Our inspections may include but are not limited to an interior, exterior, sinkhole or any combination of these inspections. Risks that do not pass a sinkhole inspection will be non-renewed. The insured may request a comparable policy with no sinkhole coverage (the policy will continue to include Catastrophic Ground Cover Collapse Coverage). Refer to the Sinkhole Loss Coverage section of the manual for complete details. Voluntary Dwelling April 2013 Page 6

7 HURRICANE - TROPICAL STORM SUSPENSION Agents binding authority automatically terminates for new business and coverage increase/decrease when a "Hurricane or Tropical Storm Warning" has been issued by the National Oceanic and Atmospheric Administration or the National Weather Bureau based on the following rules: Hurricanes: Binding is restricted when the Hurricane is within the following boundaries: 72 W longitude, 15 N latitude, 90 W longitude, 32 N latitude. Tropical Storms: Binding is only restricted in areas under a tropical storm warning or watch. The rest of the state remains open. No new coverage shall be written within the first seventy-two (72) hours after a tropical storm or hurricane has left the aforementioned defined area unless the Company has removed the binding restrictions, the agent has inspected the property to verify that no loss has taken place, obtained a signed no loss statement from the applicant and noted on the application that said inspection was made. Renewals will only be issued on an "as expiring" basis for coverage and perils; limits will only be increased to keep pace with established inflation factors. ELIGIBILITY UNDERWRITING(NEW BUSINESS) The risk must meet all qualifications and rules before it can be bound. If there is a question regarding the qualifications, please discuss with your underwriter prior to submission. GENERAL Coverage may be issued on a dwelling containing not more than four units; or a town or row house structure. A dwelling with Coverage A under $125,000 requires color photos (front and back) of home and must be submitted to the Company prior to binding. The peril of windstorm or hail may be excluded if property is eligible for such coverage from Citizens Property Insurance Company (CPIC) or if the insured signs the AIIC DP XW form, indicating the Request to Exclude Windstorm and Hail Coverage. Homes located in a Special Flood Hazard Area (any combination of Zone A or V) must be covered by a Federal Flood insurance policy with matching Coverage A limit (or maximum limit available). Home must be protected with smoke detectors in close proximity of kitchen and sleeping areas. Porches or decks more than 2 feet off the ground or with 3 or more steps leading to them must have properly installed handrails or safety railings. Dwellings with an open foundation with an appropriate surcharge. The Company reserves the right to request color photos of any risk. Tenant occupied dwellings must be managed by a property management company if the owner lives more than 100 miles away from the property. Voluntary Dwelling April 2013 Page 7

8 INELIGIBLE RISKS DO NOT SUBMIT properties where the following exists: GENERAL CHARACTERISTICS Business Exposure- Properties where business is conducted. Two salient elements to help identify a business include: (1) a profit motive and (2) continuity of the activity. This includes but is not limited to: all manufacturing, retail sales when customer traffic is common, bed & breakfast operations, nursing homes, adult care facilities, produce stands, u-pick-it operations, animal kennels, repair work, hair salons and home day care (3 or more children). Farms and Ranches Properties (dwellings) which are part of a "working farm," working ranch, orchard or grove. "Working farms" are defined as properties with any livestock (such as cows, horses, hogs, goats, etc.), properties on which row crops are grown (other than a domestic garden), or properties with income producing farming/ranching operations. Condemned Properties Properties which have been condemned due to condition, properties located in a condemned area or properties in an area scheduled to be condemned due to urban renewal or highway construction. Inaccessible Properties Properties not readily accessible year round to fire department equipment. Isolated properties including barrier islands not connected to the mainland by a road or where emergency vehicles are unable to access a property due to road in poor condition. A road in poor condition includes but is not limited to: ungraded or unstable dirt, potholes, deep sand or other obstructions preventing emergency access. Isolated properties are defined as those that are not visible from at least two dwellings or in sight of a public road Commercial Properties Mobile/Manufactured Homes, Trailer Home, or House trailer Dwellings located in a Citizens High Risk Area or within 1500 feet of tidal waters. Dwellings Constructed Over Water Do-It-Yourself Construction- Buildings or structures that are homemade or rebuilt, or any dwelling with extensive remodeling without permits or a certificate of occupancy. Non-Habitational Properties- Residential risks used primarily for non-habitational purposes or dwellings that were originally designed or constructed for other than habitational purposes. Fraternity or Sorority Houses Fraternity, Sorority or any similar housing arrangement. Vacant or Unoccupied Properties- "Vacant" is defined as a dwelling with no contents or occupants, it is empty. Unoccupied includes dwellings with contents if the dwelling is no longer a place of usual return. Dwellings vacant or unoccupied 30 days or more before purchase by the insured. Risk is acceptable if it was vacant or unoccupied solely due to remodeling or renovation. A vacant home may be eligible for the DP1 Vacant program. Exceptions may be made for Secondary/Seasonal homes. Risks located in a Protection Class 10 Refer to the Properties located on more than 5 Acres in a PC9 or a PC 10 property of the section of the manual for additional details. Properties subject to brush or forest fire. Premium financing as a payment option Daily or weekly rentals Voluntary Dwelling April 2013 Page 8

9 PROPERTY FEATURES Dwellings of unconventional construction or materials including but not limited to Log or Dome homes, etc. Dwellings in the course of construction. Dwellings with asbestos, EIFS (Synthetic Stucco) siding, nonstandard or hazardous building materials (Chinese drywall). Roofing: A roof that is worn, with patched areas, multi-layered or has unrepaired damage Shingle/Composition roofs more than 20 years old; validation of roof condition and life expectancy may be required at new business or prior to renewal. Tile or metal roofs more than 40 years old; validation of roof condition and life expectancy may be required at new business or prior to renewal. Asbestos shingle, tin/aluminum or wood shingle roofs. Plumbing: Dwellings with polybutylene plumbing Heating: Dwellings heated in whole or in part by solid fuel heating devices, such as wood burning stoves or fireplace inserts, or heated by a device which is not controlled by a wall-mounted thermostat (e.g. portable space heater, portable gas heater, or any device utilizing an open flame). Electrical: Properties with any potential hazardous electrical conditions, knob & tube wiring, fuses or Aluminum branch wiring which has not been updated to conform to current local codes Properties equipped with electrical service less than 100 amps PROPERTY CONDITION Property in Disrepair/Existing Damage- Properties in a state of disrepair or properties with existing damage. Dwellings which are not properly maintained, this includes but is not limited to: Dwelling(s) or unattached structure in poor condition, In need of paint or repairs Clutter/debris Un-kept property, etc. LIABILITY EXPOSURE(S) Excessive or Unusual Liability Exposure including but not limited to: A pit bull, pit bull terrier or Staffordshire terrier, wolf, wolf hybrid or any mix of such dogs, owned by the insured or kept on the premises, are ineligible animals Any animal with aggressive tendencies, history of attack or trained as an attack animal owned by the insured or kept on the premises. This includes non-domesticated and/or exotic animals. Pools not completely fenced, walled or screened. The fence or wall must be of a material that provides a reasonable barrier to entry (e.g. chain link, wood, steel or aluminum), be at least 4 high, permanently installed, comply with local ordinances, and have a self-locking gate or door. The pool may not have a diving board or slide. Above ground pools must have steps that can be locked in the up position. Voluntary Dwelling April 2013 Page 9

10 Trampolines in unfenced yards. The fence or wall must be of a material that provides a reasonable barrier to entry (e.g. chain link, wood, steel or aluminum), be at least 4 high, permanently installed, comply with local ordinances, and have a self-locking gate or door. Attractive nuisances including but not limited to: racing or activity courses, large play grounds, skate board or bicycle ramps. Disabled, unused, or untagged vehicles on the premises Risks where the insured owns recreational vehicle(s) including but not limited to: ATV, Dune Buggy, Go Cart, or Dirt Bike. Risks are acceptable if insured provides proof of separate liability coverage with the same limit as provided on this policy. Evidence must be maintained in Agent s Office and is subject to audit at the request of the Company. Applicants in possession of dangerous firearms including, but not limited to, assault-type and rapid fire weapons, except for game hunting rifles or shotguns. PROPERTY VALUE(S) OR MORE THAN ONE HOME ON THE PROPERTY Coverage Limits Minimum/Maximum- Properties for which replacement cost (Coverage A ) or Actual Cash Value is either below or above the limits shown in the Minimum and Maximum Values section of the Dwelling Property Program Manual. Replacement Cost/MARKET Value Ratio Properties with Replacement Cost exceeding 1 1/2 times the MARKET value, excluding land values. Homes which have been a recent foreclosure or repossession. Risks with more than one dwelling on the premises, whether a home or manufactured home, without separate parcel, deed or separate address. A single family residence occupied by more than one family. APPLICANT CHARACTERISTICS AND LOSS HISTORY Risks with any prior or current Sinkhole activity on the premises whether or not it results in a loss to the dwelling. If any prior sinkhole loss, coverage cannot be bound. Properties located in close proximity to known sinkholes will not be issued with Sinkhole Loss Coverage. Refer to the Sinkhole Loss Coverage section of the manual for complete details. Arson or Insurance Fraud At the time of application, applicants convicted of arson in the past 25 years, cancelled for insurance fraud in the past 15 years or material misrepresentation on an application for insurance in the past 7 years. Applicant(s) who have had a bankruptcy, repossession or foreclosure within the past 60 months. For applicants who have sustained more than one (1) loss of any type, other than a weather related event. Refer to company before binding. For applicants who have sustained a fire or personal liability loss in the last 60 months, coverage cannot be bound. Refer to underwriting for further review. Property claims that are a result of an act of God will not be used as a cause for cancellation or non-renewal unless the insured has failed to take action reasonably necessary to prevent recurrence of damage to the insured property. Voluntary Dwelling April 2013 Page 10

11 GENERAL RULES The Dwelling Policy Program provides property and liability coverage, using forms and endorsements specified in this manual. The manual contains the rules and classifications governing the writing of the Dwelling Program policy. The rules, rates, forms and endorsements of American Integrity Insurance Company for each coverage shall govern in all cases not specifically provided for in this manual. APPLICANT Must hold title to home with a maximum of two mortgages. Credit history may be evaluated for all applicants as it relates to insurance eligibility. (Refer to the Insurance Score section for additional details.) Must be an owner or landlord of a dwelling. AGE OF HOME (NEW BUSINESS AND RENEWAL) A home of any age is eligible for the Dwelling Property program; the home must be maintained in good condition regardless of age. A dwelling 30 years of age or less may be eligible without additional requirements unless information is disclosed at the time of application which would make the risk ineligible. A dwelling attaining greater than 30 years of age during the policy term is subject to the underwriting requirements outlined in the following section. Coverage can be added for Water Back Up only if the Limited Water coverage has been selected and evidence of satisfactory updates has been provided. GREATER THAN 30 YEARS A dwelling greater than 30 years of age can only be written with the AIIC HO 09 WD WATER DAMAGE EXCLUSION ENDORSEMENT attached and any loss resulting from water damage will be excluded unless the loss qualifies as a hurricane loss. The loss settlement on Coverage A and B is also changed to Actual Cash Value. The Actual Cash Value loss settlement may be waived for dwellings that have been substantially renovated and/or updated. Evidence of acceptable condition and proof of updates in the past 20 years is required to the following systems: o Plumbing (supply/drain lines have been updated with acceptable materials for all of the sinks, commodes and washer/dryer connections, including the hot water heater), preferred materials for the supply/drain lines are copper, PVC, etc. o Electric (electrical main and sub panels), o HVAC (both heat and A/C units) and o Roof (including primary and secondary roof systems) A 4 Point inspection, receipts or work orders showing the updates are accepted as evidence of eligibility. Inspections must be performed by a licensed/qualified inspector or inspection company and the license number and contact number must appear on the report. AIIC accepts any 4 point inspection form if all the required information is indicated. Refer to the Forms section of the Dwelling Program Manual for an acceptable 4 Point inspection form. Documentation must be submitted within 30 days of inception for continuation of coverage and must be completed within the last 60 months. Voluntary Dwelling April 2013 Page 11

12 The Limited Water Damage Endorsement (AIIC DP 09 LWD) is available for an additional premium if the property has documented updates (see above). CANCELLATION OR REDUCTIONS IN LIMITS OF LIABILITY OR COVERAGE Mandatory coverages may not be cancelled unless the entire policy is cancelled. If insurance is increased or reduced, the additional or return premium shall be computed on a pro-rata basis, subject to the minimum premium rule. The insured may cancel the policy at any time for any reason. We will refund any unearned premium pro rata subject to the waiver of premium rule. Note: Hurricane deductible options may only be amended at renewal of the policy. A policy may not be cancelled and rewritten to circumvent this rule. INSURANCE SCORE GUIDELINES The credit of all Named Insured s may be reviewed in compliance with section F.S. and Florida Rule 69B with the consent of the applicant or insured. Credit is evaluated along with prior claims history, condition of property and other risk factors. Credit history is ordered and an Insurance Score (IS) is determined only on the Named Insured s for all new business policies. The agent must obtain permission from the applicant prior to requesting the credit report. If the Insurance Score is below 650, or there is a No Hit/No Score, a CLUE report and a property inspection report are ordered. More than one non- weather related claim or poor condition of the property will make the risk ineligible. When an Insurance Score cannot be generated due to either a No Hit or lack of data the applicant or policyholder will not be adversely affected. A No Hit/No Score qualifies for a discount. For an insured or applicant whether adversely affected by their credit history or not, credit will be reviewed, with policyholder approval, once every two (2) years or at the request of the insured. The insured will receive a discount if their Insurance Score has improved to 700 or above. Insurance Score discounts are available based on an independent grade derived from the applicants credit record, as shown below: (Apply to F-D, F-C, EC-D and EC-C) Factor Level 2: Score of 750 or greater 0.80 Level 1: Score of and No Hit/No Score 0.90 LAPSE IN COVERAGE/NO PRIOR INSURANCE Risks with a lapse in coverage that exceeds 45 days from the date of the lapsed/cancelled policy or have had no prior insurance, must obtain Underwriting approval prior to binding. A Statement of No Loss must accompany any request. If approved, the risk will be subject to a 10% surcharge which will be applied for one (1) year from the date of issuance of the policy. The surcharge does not apply to first time home buyers or renewals. Refer to the Credits/Surcharges section of the manual for the surcharge rules. Any lapse in coverage greater than 90 days will not be accepted in this program and may be eligible for the DP1 program. Force placed insurance is not considered acceptable proof of prior insurance. Voluntary Dwelling April 2013 Page 12

13 LOSS SETTLEMENT Losses under Coverage A & B are covered at replacement cost subject to certain conditions unless Endorsement DP Actual Cash Value Loss Settlement is attached changing settlement to ACV. This endorsement is required on homes older than 30 years of age. Losses under Coverage C, personal property will be covered at actual cash value at the time of loss, which means there will be a deduction for depreciation. MULTIPLE COMPANY INSURANCE We will not provide coverage for a dwelling that is also covered by another insurance policy. OCCUPANCY/USE Residence may be: Seasonal owner occupied dwellings (occupied by owner more than 4 and less than 9 months) may be rented to others for periods not less than 1 month. Rental properties must be rented on annual leases with a minimum 1 year term. Rental properties rented on a monthly basis may be considered by the Company and are subject to underwriting approval. Used for private residential purposes only with the exception of certain incidental occupancies and/or up to 2 roomers or boarders are permitted. Properties with home day care exposure of 3 individuals or less are not eligible for this program unless evidence of: 1. A current copy of a Certificate of Insurance from the insurer providing Commercial General Liability coverage at limits equal to or greater than the Personal Liability is provided at the time of application to the Company. Coverage cannot be bound and must be referred to underwriting for further review. 2. A current copy of the Florida Department of Children and Families "Family Child Care Home Certificate of License," or a copy of a current Child Care License for the covered premises issued by the county of jurisdiction is provided to the Company prior to issuance or renewal of each policy period. A single family dwelling, duplex, three or four family unit dwelling is eligible. SINGLE BUILDING DEFINITION All buildings or sections of buildings that communicate through unprotected openings shall be considered as a single building. Buildings that are separated by space shall be considered as separate buildings. Buildings or sections of buildings, which are separated by: o A 6-inch reinforced concrete or 8-inch masonry party wall that pierces or rises to the underside of the roof and pierces or extends to the inner side of the exterior wall shall be considered a separate building. Accessibility between buildings with independent walls or through masonry party walls described above shall be protected by at least a Class A Fire Door installed in a masonry wall section. POLICY TERM A policy may be written for a period of 12 months and may be extended for successive policy periods by renewal based upon the forms, premiums and endorsements in effect for the Company at the time of renewal. Voluntary Dwelling April 2013 Page 13

14 PRIOR CANCELLATIONS/NON-RENEWALS Risks previously cancelled for non-payment or underwriting reasons other than reduction of hurricane exposure, should be referred to the Company and are subject to underwriting approval. If the applicant has been cancelled for non-payment by AIIC, the policy may not be reinstated or rewritten without underwriting approval. If approved, the insured may be asked to provide a Statement of No Loss and a partial or full payment of the premium. PROPERTIES DEEDED IN AN LLC (LIMITED LIABILITY CORPORATION, TRUST OR CORPORATION) The risk may be eligible for the Dwelling Property program if the LLC, Trust or Corporation requires Named Insured status. In these circumstances, liability will be excluded. RENEWAL PLAN If the company elects to offer a renewal, the policy may be renewed by the policyholder by paying the renewal premium prior to the expiration of the current policy. A renewal policy will be issued based on the premiums, forms and endorsements in effect at time of renewal. A new declarations page will be issued. A payment schedule will be mailed with each renewal offer, 60 days prior to the expiration date of the policy term, if the policyholder is the payee. If the account is escrow billed, then a billing statement will be mailed to the policyholder and the mortgage holder. The insured is responsible for ensuring the payment is received prior to the expiration of the policy term. The following risks are not eligible for offers of renewal coverage: Properties failing to be maintained in safe and serviceable condition or where repairs have not been completed or when the insured has failed to mitigate risk hazards. Properties no longer meeting minimum or maximum coverage limit requirements or failing to maintain proper insurance to value. Properties not meeting or continuing not to meet eligibility standards applicable to new business. Property claims that are a result of an act of God will not be used as a cause for cancellation or non-renewal unless the insured has failed to take action reasonably necessary to prevent recurrence of damage to the insured property. Risks determined by the Company to be unacceptable for renewal coverage due to: 1. Exposure management considerations, company financial performance, prospective business plans or objectives; 2. The availability and pricing of reinsurance; 3. Factors relating to the risk that would have adversely affected the Company s overall risk assessment if those factors had existed or been known at the time of initial underwriting. The Company, in its discretion, may offer renewal coverage to a risk not otherwise eligible for renewal pursuant to this rule based upon characteristics of the risk or an overall risk assessment, or the Company may determine pursuant to an overall risk assessment that it will not offer a renewal policy to a risk otherwise meeting eligibility criteria. Voluntary Dwelling April 2013 Page 14

15 ROOF (NEW AND RENEWAL BUSINESS) A roof must be in good condition and not be worn, with patched areas, multi-layered or unrepaired damage. A patched roof is evident when several sections of a roof have been repaired/replaced with either the same/similar shingles or have been tarred, etc. Asphalt/Composition shingle roofs must have been replaced within 20 years. Prior to renewal, AIIC may request policyholders with homes over 20 years old to provide validation (color photos and/or other evidence) of roof life expectancy. Homes with roofs less than 3 years life expectancy will be non-renewed the following year. If the entire roof has been replaced the policy will be noted with the date of the roof replacement. Tile or metal roofs more than 40 years old. Prior to renewal, AIIC may request policyholders with roofs over 40 years old to provide validation (color photos and/or other evidence) of roof life expectancy. Homes with roofs less than 3 years life expectancy will be non-renewed the following year. If entire roof has been replaced the policy will be noted with the date of roof replacement. Asbestos shingle, tin/aluminum, or wood shingle roofs are not eligible. A dwelling with a flat roof greater than 20% may only be written with the AIIC HO 09 WD WATER DAMAGE EXCLUSION ENDORSEMENT attached. SECONDARY/SEASONAL RESIDENCES (NEW BUSINESS) A dwelling unoccupied by the owner for more than 3 months annually is considered a Secondary/Seasonal residence. Secondary/Seasonal residences are not eligible for coverage in this program unless the residence is owner occupied for a minimum of 4 months per policy year, AND: residence is located within a limited access community or building (requires security guard or passkey gates), OR residence has a functioning central station fire and burglar alarm system. SWIMMING POOLS (NEW AND RENEWAL BUSINESS) A swimming pool must have a fence or wall of a material that provides a reasonable barrier to entry (e.g. chain link, wood, steel or aluminum), be at least 4 high, permanently installed, comply with local ordinances, and have a self-locking gate or door. Child gates/fences that are not permanently installed with a locking gate are unacceptable. Above ground pools must have steps that can be locked in the up position. No diving boards or slides are permitted. TOWN OR ROW HOUSE (NEW BUSINESS) A policy may be issued for a Town or Row house if it can be determined that it does not exceed the maximum allowed number of units. The following should be considered in the determination: Each unit must be separated by parapet* walls or adequate masonry firewalls. There may be a maximum of 8 units per building if a firewall is between each unit. For example, a 2 family dwelling attached to a 1 family dwelling is considered 3 individual family units within a Fire Division if both dwellings are not separated by a firewall. Four attached 2 family dwellings are considered 8 family units within a Fire Division if they are not separated by firewalls (and thus ineligible). Coverage A is available when a dwelling contains 4 or less family units within a Fire Division and/or Coverage C in a dwelling with 1 or more individual family units within a Fire Division. See Single Building Definition *A parapet or firewall that pierces the roof and extends above the roof line at least 15 or higher shall be considered a separate dwelling. Voluntary Dwelling April 2013 Page 15

16 TRAMPOLINES (NEW AND RENEWAL BUSINESS) A trampoline must have a fence or wall of a material that provides a reasonable barrier to entry (e.g. chain link, wood, steel or aluminum), be at least 4 high, permanently installed, comply with local ordinances, and have a self-locking gate or door. AIIC DP 09 TL - TRAMPOLINE LIABILITY EXCLUSION is attached to the policy. TRANSFER OR ASSIGNMENT No transfers or assignments are permitted. Each insured and/or property will require submission of a new application and will be subject to the underwriting requirements at the time of application. WAIVER OF PREMIUM When a policy is first issued or endorsed after the inception date, additional or return premium of less than $5 is waived. However, the company shall grant any return premium due if requested by the insured. WHOLE DOLLAR PREMIUM RULE When calculating premium, premiums are not rounded during the calculation process. Total premium for Fire, Extended Coverage, Hurricane and each Additional Coverage are rounded to the nearest whole dollar. A premium of fifty cents ($.50) or more shall be rounded to the next higher whole dollar. In the event of cancellation by AIIC, the return premium may be carried to the next higher whole dollar. INSURANCE TO VALUE Risks must be insured for 100% of replacement cost as determined by an acceptable cost estimator done at the time of application, endorsement or renewal of policy (a cost estimator must be maintained in the Agent s Office and is subject to audit at the request of the Company). A home older than 30 years of age must be insured at 100% of Actual Cash Value which can be obtained by adjusting the cost estimator for depreciation. Actual cash value means the amount which would cost to repair or replace covered property with material of like kind and quality, less allowance for physical deterioration and depreciation, including obsolesce. Voluntary Dwelling April 2013 Page 16

17 BINDING AUTHORITY LIMITS/PROGRAM DESCRIPTION Coverage A may be issued on a dwelling: Containing not more than four units; Town or row house structure (i.e. a tri/quadplex); Coverage C may be included on personal property in a dwelling insured under Coverage A. Coverage D may be provided for the loss of fair rental value of a dwelling. Coverage E may be provided for the additional living expenses incurred to maintain the insured s household. The following coverage limits are available for the DP Dwelling Property 3 Special Form: Coverage Limits Coverage A- Dwelling $125,000* to $500,000 Coverage B- Other Structures 1% up to 20% of Coverage A Coverage C- Personal Property 0 to $250,000 of Coverage A Coverage D- Fair Rental Value (Tenant) OR 10% of Coverage A Coverage E- Additional Living Expense (Owner Occupied) 10% of Coverage A Coverage L-Personal Liability** 100,0000 included; $300,000 also available Coverage M-Medical Payments to Others** $1, 000 included; $5,000 also available *Dwellings with replacement cost below $125,000 or above $500,000 must be referred to underwriting with a completed replacement cost estimator and color photos. **Personal Liability and Medical Payments to Others are optional under the DP3 Special Form. CONSTRUCTION DEFINITIONS Frame - exterior wall of wood or other combustible construction, including wood-iron clad, stucco on wood or plaster on combustible supports, and aluminum or plastic siding over frame. o HardiPlank Siding Frame homes with HardiPlank Siding will be classified as Frame. Masonry Veneer all exterior walls of frame construction veneered with brick, masonry or stone. Masonry Veneer can be rated as masonry only if all of the walls are veneered as indicated. 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. Superior Construction Non-Combustible - exterior walls, floors and roof constructed of, and supported by, metal, asbestos, gypsum, or other non-combustible materials. Masonry Non-Combustible - exterior walls constructed of masonry materials (as described above) and floors and roof of metal or other non-combustible materials Fire- Resistive - exterior walls, floors and roof constructed of masonry or other fire resistive materials. Mixed (Masonry/Frame) - a combination of both frame and masonry construction shall be classified as Frame when the exterior walls of frame construction (including gables) exceed 33% of total exterior wall area; otherwise classify as Masonry. Voluntary Dwelling April 2013 Page 17

18 MANDATORY ENDORSEMENTS The following endorsements are attached to the DP Dwelling Property 3 Special Form: AIIC DP 09 SP SPECIAL PROVISIONS - FLORIDA is attached to all policies. Additional Living Expense Loss Participation - requires the policyholder to pay 20% of temporary living expenses. Excludes wind/hail damage to all antennas, satellite dishes, awnings, fences, screened enclosures, other structures or personal property located outside of the primary residence. This exclusion does not apply to Coverage B (other structures) if the limit has been increased from the automatic 2% provided in the policy. Includes a Special Limits of Liability coverage for Cosmetic and Aesthetic Damage to Floors. Limits non-structural hail loss to 2% of Coverage A. AIIC DP 09 SPL SPECIAL PROVISIONS LIABILITY is attached to all policies that include Liability Coverage and adds the following exclusions: Exposure to lead or any lead based product, Bodily injury or property damage arising out of an assault and/or battery committed by the named insured. AIIC DP 09 HD - CALENDAR YEAR HURRICANE DEDUCTIBLE WITH SUPPLEMENTAL REPORTING REQUIREMENT- FLORIDA Applied to all policies with the coverage of Wind or Hail. AIIC DP DO DEDUCTIBLE OPTIONS NOTICE Attached to all policies listing the various deductible options available. AIIC DP 09 TL - TRAMPOLINE LIABILITY EXCLUSION Attached to all policies when Personal Liability is selected and excludes personal liability for the use of a trampoline on the insured premises or supervision by an insured of trampoline usage off the insured premises. AIIC DP 09 FCE - LIMITED FUNGI, MOLD, WET OR DRY ROT, OR BACTERIA COVERAGE ENDORSEMENT This endorsement provides a maximum limit of Section I $10,000 for each covered loss/$10,000 policy aggregate. AIIC DP WINDSTORM EXTERIOR PAINT OR WATERPROOFING EXCLUSION- SEACOAST- FLORIDA is attached to all policies that include wind coverage in the following territories: 50, 70, 12*, 14*, 18*, 310, 320, 350, 360, 361, 380, 410, 420. This endorsement excludes damage from windstorm or hail to all paint or waterproofing material applied to the exterior of any dwelling or structure. *indicates any territory beginning with 12, 14, 18 Voluntary Dwelling April 2013 Page 18

19 AIIC DP 09 WD WATER DAMAGE EXCLUSION ENDORSEMENT This endorsement is attached to all policies over 30 years of age. This form excludes water damage subject to the limits, exclusions and conditions listed in the policy from: a. Accidental or intentional discharge or overflow of water or steam from within a plumbing, heating, air conditioning or automatic fire protective sprinkler system or from within a household appliance. b. Water penetration through the roof system or exterior walls or windows whether/or not driven by wind unless water penetration is a direct result of wind or hail. DL LIMITED FUNGI, WET OR DRY ROT, OR BACTERIA COVERAGE This endorsement provides an aggregate Section II policy limit of $50,000 when Personal Liability is selected. DL PERSONAL LIABILITY This Endorsement is attached to all owner occupied dwellings that include Liability Coverage. DL PREMISES LIABILITY This Endorsement is attached to all tenant occupied dwellings or dwellings which become vacant during the policy term policies that include Liability Coverage. DL NO COVERAGE FOR HOME DAY CARE BUSINESS This Endorsement is attached to all policies that include Liability Coverage. This Endorsement excludes all Liability coverage for Home Day Care. MANUAL PREMIUM REVISION A manual premium revision shall be made in accordance with the following procedures: 1. The effective date of such revision shall be announced. 2. The revision shall apply to any policy or endorsement in the manner outlined in the announcement of the revision. 3. Unless otherwise specified at the time of the announcement of the premium revision, the revision shall not effect: a. in-force policy forms, endorsements or premiums, until the policy is renewed; or b. in the case of the Premium Payment Plan, in-force policy premiums, until the anniversary following the effective date of the revision. MINIMUM AND MAXIMUM VALUE Agent may not bind coverage for less than $125,000 or more than $500,000. submitted to Underwriting for possible binding approval. Risks may be Minimum Coverage A amount is $125,000 Dwelling Maximum Coverage A amount is $500,000 Dwelling Voluntary Dwelling April 2013 Page 19

20 MINIMUM PREMIUM The minimum annual premium charged for a Dwelling Property is $ The minimum annual premium shall include all chargeable endorsements or coverage s, if written at the inception of the policy. 2. The MGA policy fee and the EMPATF surcharge (Refer to Additional Fees section of the Dwelling Program Manual for details) are not included in the minimum annual premium, and are fully earned upon inception. 3. When necessary to collect at the request of the OIR, FIGA surcharges, Citizens assessment surcharges, and FHCF assessment surcharges are not included in the minimum annual premium. These surcharges are not fully earned, if the policy is amended or cancelled, the additional or return premium, including these surcharges, shall be calculated on a pro rata basis. MULTIPLE LOCATIONS This program does not permit coverage for multiple locations on the same policy. PROPERTIES LOCATED ON MORE THAN 5 ACRES IN A PC 9/10 OR A PC 10 PROPERTY A dwelling located in a Protection Class (PC) 9/10 on more than 5 acres or a Protection Class 10 is subject to review to determine eligibility. PC 10 risks must have central station reporting fire alarm or be located in a limited access/gated community. The following information will be required to be submitted to the Company to be able to review the risk: Name of the responding fire department Response time Is the station voluntary or manned 24 hours? Water source? Distance to the hydrant or water source, if there is one. The number and carrying capacity of the pumper and tanker trucks. PROPERTIES WITH FARM ANIMALS OR HORSES (NOT ON A FARM) A risk with farm animals or up to 5 horses can be considered subject to underwriting approval. An acre per animal is desired or a risk with a small number of animals typically found on a farm. Further underwriting may be required to determine it is not a commercial exposure or a farm. Voluntary Dwelling April 2013 Page 20

21 PROTECTED SUBDIVISION RULE A dwelling located in a qualifying subdivision (new community/development), which is currently a Protection class 9 or 10 community, may receive the rating of the lower Protection Class from the responding fire department if all of the following are met: The subdivision is under development with recorded plat and paved roads where dwellings are built by licensed contractors subject to building restrictions as to type and square footage. The subdivision contains at least 10 houses. The subdivision is within 5 miles travel distance of a responding fire department. The home is located within: o 1,000 feet of a standard fire hydrant, or o responding fire department is equipped to transport an adequate water supply for fighting fire or o responding fire department is equipped to pump water from swimming pools or other sources within 1,000 feet of the home. *The lower protection class will be available for 5 years from when the home was constructed. Note: If a dwelling is located in a Protection class 9 or 10 community and qualifies for the protected subdivision rule, the application must be documented accordingly. PROTECTION CLASS The Protection Class listings in the Public Protection Classification Manual apply. Use PC 10 for unclassified areas, in a classified area where two or more classifications are shown (e.g. 6/9), the classification is determined as follows: Distance to Fire Station Voluntary Dwelling April 2013 Page 21 Class 5 road miles or less with hydrant* within a 1000 feet, use the first protection class (e.g. 6/9 would use Class 6) 6 5 road miles or less with hydrant* beyond a 1000 feet, use the second protection class (e.g. 6/9 would use Class 9) 9 Over 5 road miles 10 *Hydrant distance requirement does not apply when an alternative credible water supply is available. Refer to notes under specific communities in Public Protection Classification Manual for applicability. COVERAGE OPTIONS ADDITIONAL INSURED In addition to the Named Insured listed in the Declarations, additional persons or organizations may be listed which are an insured of the residence premises. If the policy is cancelled or nonrenewed, the parties named will be notified in writing. This endorsement is not available for the LLC or Trust. Refer to Endorsement- DP ADDITIONAL INSURED (DESCRIBED LOCATION) AND DL ADDITIONAL INSURED (RESIDENCE PREMISES) WHEN LIABILITY IS SELECTED

22 ADDITIONAL INTERESTS In addition to the Mortgagee(s) shown in the Declarations or elsewhere on the policy, additional persons or organizations may be listed which have an interest in the residence premises. If the policy is cancelled or non- renewed, the parties named will be notified in writing. This endorsement is available for the LLC or Trust which requires notification when the policy is cancelled or non-renewed. Refer to Endorsement - HO ADDITIONAL INTERESTS (RESIDENCE PREMISES) BUSINESS PURSUITS - NO COVERAGE This program does not offer coverage for liability arising out of business activities. Applicants who conduct business from a residence that includes client traffic or contact are not eligible for this program. COVERAGE B - OTHER STRUCTURES DECREASED OR INCREASED LIMITS Applicant(s) may select a desired coverage limit for other structures located on the residence premises. Other structures may not be used for business purposes except permitted incidental occupancy or rented for use as a private garage, rented to others, or used by non-related persons for residence purposes. Coverage equal to 2% of coverage A is included in the basic policy. The following additional coverage options are available (apply to NHR and HUR): % of Coverage A Factor 1% % % % % 1.14 Refer to Endorsement- AIIC DP 09 CBD COVERAGE B OTHER STRUCTURES DECREASED LIMITS OR AIIC DP 09 CBI COVERAGE B OTHER STRUCTURES INCREASED LIMITS COVERAGE C PERSONAL PROPERTY Personal Property is not included unless selected. Limits may be purchased in $1,000 increments to a maximum of 70% of the Coverage A. A selection of 40% or less of Coverage C is ineligible for Personal Property Replacement Cost as well as burglar alarm credit. When Coverage C is not selected, the following rules do not apply and endorsements are not available: PERSONAL PROPERTY REPLACEMENT COST- AIIC DP PPRC Voluntary Dwelling April 2013 Page 22

23 DEDUCTIBLES All policies are subject to a deductible that is applied to a Section I- Property loss. The two deductibles are an All Other Perils Deductible and a Hurricane Deductible. When Wind coverage is included in the policy, the base deductibles are: $500 All Other Perils deductible $500 Hurricane deductible When a loss occurs from a peril other than Hurricane, the All Other Perils deductible will be applied to the reported occurrence. If a reported loss is due to a Hurricane then the deductible will be applied as outlined in the following section. Optional deductibles are also available and are outlined below. For all perils except hurricane (apply to F-D, F-C, EC-D, EC-C) Amount Factor $ , , , Hurricane Deductibles (Not available for policies excluding wind) A hurricane deductible subjects the policy to a percentage deductible amount that applies to any Section I- Property loss due to damage from the perils of Hurricane. During a hurricane, the deductible will be applied beginning at the time a hurricane watch or warning is issued for any part of Florida by the National Hurricane Center of the National Weather Service and will end 72 hours following the termination of the last hurricane watch or hurricane warning issued by the National Weather Service. A Hurricane means a storm system that has been declared to be a hurricane by the National Hurricane Center of the National Weather Service. The National Weather Service currently uses the Saffir/Simpson Hurricane scales to categorize hurricanes. This scale specifies that a hurricane is a storm that originates in the tropics and results in either a sustained wind speed of at least 74 miles per hour or a storm surge of at least 4 feet above normal. A hurricane deductible shall apply on an annual basis to all covered hurricane losses that occur during a calendar year, regardless of the policy term. If there was a hurricane loss for prior hurricane(s) during a calendar year, the deductible applying to a subsequent hurricane loss is the greater of the remaining amount of the hurricane deductible or the amount of the deductible that applies to perils other than a hurricane. Hurricane deductibles may only be changed at time of renewal. Note: Hurricane deductible options may only be amended at renewal of the policy. A policy may not be cancelled and rewritten to circumvent this rule. Refer to Endorsements - AIIC DP 09 HD CALENDAR YEAR HURRICANE DEDUCTIBLE WITH SUPPLEMENTAL RECORD KEEPING REQUIREMENT Voluntary Dwelling April 2013 Page 23