MARCH 2014 NEWSLETTER

Transcription

1 NORTHWEST G F MUTUAL INSURANCE COMPANY MARCH 2014 NEWSLETTER From the President s Desk Frugal or Cheap I ve spent most of my adult life walking that fine line between frugality and simply being cheap. My wife would probably argue that I often times fall on the excessively cheap side of the equation. But you tell me, where it is written that you can't say I love you with Cubic Zirconia! Actually if you're worried about where you may fall in regards to that analysis, perhaps the following examples will provide you with some insight and clarification: If you forgo a few needed home repairs to save money, you may be frugal. On the other hand if an F-4 tornado strikes your property and does $100,000 worth of improvement, you're probably cheap! If you wait until the dishwasher is just about overflowing before you start it, you're probably frugal. However if you're heading to the car wash to wash your pickup truck and you throw your dirty dishes in the back, you're probably just cheap. If you purchase generic cholesterol-lowering medication you're probably frugal. If you forgo taking your medication and simply start eating spam light, you're probably just cheap. If you avoid buying fresh vegetables to save money, you may be frugal. However, if you cancel Thanksgiving dinner because you ran out of ketchup, you're probably just cheap. Last but certainly not least if your client sells an auto and immediately calls you to have it removed from the policy in order to receive a pro-rata refund of the policy premium, your client is probably frugal. However if your client intends to replace the vehicle in short order but still wants it immediately removed from the policy in order to save a few days premium, your client is probably cheap, and this could cost your insured a heap! In this example above the insured should be advised that their NWGF Auto policy provides much broader Liability, UM, UIM, Med-Pay and PIP coverage on newly acquired vehicles, when these new vehicles replace one currently shown on the declarations, vs. one that is simply added to the policy. In fact for these aforementioned coverages, an insured does not even have to ask our company to insure a newly acquired vehicle, as long as the newly acquired vehicle replaces one shown on the dec. Otherwise additional vehicles not replacing existing vehicles must be reported within 14 days after the insured becomes the owner. It should be noted that Comprehensive and Collision Coverage work differently, as both require 14 day notice to the company in situations where other vehicles on the policy are insured for these coverages, and within four days, if these coverages are not in force on a vehicle shown in the declarations. Unfortunately we have had the experience of insureds becoming involved in accidents after they had removed a vehicle from their policy, subsequently purchased an additional vehicle, then failed to meet the 14 day reporting requirement. Had these vehicles simply replaced one currently shown on the declarations, the primary coverages with the exception of Physical Damage would have continued uninterrupted. Accordingly it might behoove an agent to counsel an insured who is intent upon removing a vehicle from a policy, in situations where a replacement vehicle will be purchased in the near future. Counseling a client on these types of contractual nuances can help better protect your clients, and possibly spare them from the unintended consequences of excessive frugality!

2 From the Secretary s Desk We are anticipating warmer weather and maybe even summer. Unfortunately with summers in the Dakotas, we will also have storm season. Unfortunately, the wind and hail patterns of SD have consistently pummeled our SD West River region, sending our production in this area into an abyss of non-profitability. Accordingly in order to maintain our ability to produce this area, it is imperative that we immediately initiate the following changes: South Dakota West River new business must be quoted and underwritten at a minimum $3000 deductible ($2000 deductible will rarely be considered with prior underwriting approval). Effective 4/1/14, we will consider lower deductible options IF a minimum 1% wind & hail deductible equals $3000 or greater and this option is written. Quote ML-405 windstorm/hail % deductible. % for deductible determination is % of Coverage A. Though required for South Dakota West River business due to prior 3 year claim history, NWGF encourages these deductible options to be quoted and sold in both North and South Dakota for all lines. Tenants Form 4 NWGF requires the 25% commercial exposure charge for any risk other than personal residential rental whether due to commercially rated location, size or exposure. Only a form 4 in a residential 1-4 family dwelling or residential apartment location will NOT require the 25% charge. Effective 4/1/14 Relax the 2014 rate increases are not ready for this 4/1/14 implementation. However, the following form and coverage revisions are effective 4/1/14 for renewal and new business. The forms and revised manual pages are available at and the quoting options and manual pages are available at the FIS Pricing Quote site. A. Semi Truck 1) Revised NW-RP1 12/13 & NW-RP2 12/13 deleting item 4 2) New CA /13 Pollution liability included B. Personal Auto 1) Upgraded edition form PP /13 2) Trailer/Trailer Home includes automatic awning and cabana coverage as part of base coverage PP C. Farmowner 1) The maximum $2500 per head maximum increased to $5000 per head before individual animal scheduling is required 2) Livestock winter perils rate increased to $3.50 per $1000 available as of 4/1/14 new business or renewals 3) Non-Depreciation of Repairs NW-160 NWGF will pay no more than $2500 or 5% of the coverage limit UNTIL ACTUAL REPAIR IS COMPLETED D. ML % of Coverage A Wind & Hail Deductible This is available for dwelling property, homeowner, farmowner and modular homeowner The % deductible is required for any DP, HO or FO dwelling risk in excess of $600,000 and any MR risk in excess of $300,000

3 E. NW-CD R Cosmetic Damage Exclusion to Roof Surfacing NWGF will require the roof type when quoting/writing any new risk effective 4/1/14. All Steel Roof will have an automatic 10% charge of Coverage A base premium. If this charge is deleted, the NW-CDR endorsement will apply and the risk will be adjusted with the Cosmetic Damage to Roof Surfacing EXCLUSION. The NW-CDR can be applied at agency request or underwriting request for any other roof coverage with NO premium credit applicable. F. NW-CD F Outbuilding Cosmetic Roof/Exterior Wall Damage Exclusion The NW-CD F will be automatically applied to all farmowner and farm fire policies for New & Renewal business effective 4/1/14. The NW-CDF will be included with a cover note advising the Insured to contact his agency to discuss the EXCLUSION and rate option to delete the Exclusion for selected outbuildings. Quoting with Bureau Reports We have included the cheat sheet reminder when you are using the NWGF Pricing FIS Quote site WITH BUREAU REPORTS. Remember if you are wishing a shorter estimated quote process, you can run quotes without the bureau reports. However, any hits on the bureau reports may alter your shorter quick quote premium.

4 NORTHWEST G F MUTUAL INSURANCE COMPANY SEMI-TRUCK - RESTRICTIVE PROVISIONS The undersigned hereby agrees to and understands that this policy carries the following restrictions: 1. The premium calculated for the insured tractor-trailer based on usage to a 150 mile radius of the Insured's farmstead. 2. The Insured will not use this unit for commercial hauling or hauling for hire. 3. The Insured will not lease, rent or loan the insured tractor-trailer for commercial hauling. 4. The policy does not provide coverage for units rented by or leased by Insured for less than a minimum 6 month term. Agent Insured NW-RP1 12/13

5 NORTHWEST G F MUTUAL INSURANCE COMPANY SEMI-TRUCK - RESTRICTIVE PROVISIONS The undersigned hereby agrees to and understands that this policy carries the following restrictions: 1. The premium calculated for the insured tractor-trailer is based on usage to a 300 mile radius of the Insured's farmstead. 2. The Insured will not use this unit for commercial hauling or hauling for hire. 3. The Insured will not lease, rent or loan the insured tractor-trailer for commercial hauling. 4. The policy does not provide coverage for units rented by or leased by Insured for less than a minimum 6 month term. Agent Insured NW-RP2 12/13

6

7

8

9

10

11

12 NWGF FARMOWNER Per Head Livestock Limit FO-6 Principal Property Coverages 4. Livestock has been amended as follows: we cover specifically scheduled livestock for which a limit is shown on the declarations. We also cover classes of livestock for which a limit is shown on the declarations. The limits shown on the declarations apply to covered livestock while on or away from the Insured premises. The most we pay for loss to any one head of livestock, other than livestock specifically scheduled on the declarations, is the smallest of the following amounts: a. 120% of the amount obtained by dividing the limit for the affected class of livestock by the number of head in that class owned by you at the time of loss b. the actual cash value of the livestock damaged or destroyed; or c. $5,000 Each head of livestock under one year of age at the time of loss will be counted as one-half head. NW-6 LVSTCK 12/13

13 NORTHWEST G F MUTUAL INSURANCE COMPANY NON-DEPRECIATION OF REPAIRS (Applies Only to Coverage F or G ) The expanded coverage provided by this endorsement applies only to Scheduled Farm Personal Property (Coverage F ) and Unscheduled Farm Personal Property (Coverage G ) However, we do not cover: a. brooders, fences, windmills or windchargers, or their towers; b. manufactured gas, liquefied petroleum gas, gasoline, or their containers; c. bulk milk tanks, bulk feed tanks, barn cleaners, pasteurizers, boilers, or any permanent fixtures attached to or within a building; d. portable buildings, portable structures, or crop driers; e. irrigation equipment, irrigation well pumps, and their motors and control panels; f. non-farm vehicles ; or g. dealers demonstration machinery, vehicles or equipment. HOW MUCH WE PAY FOR LOSS OR CLAIM Coverage under this endorsement amends, under how much we pay for loss or claim in the property coverage Form FO-20, Item 1. Our limit a. is deleted and replaced with the following: a. Non-Depreciation of Repairs The smallest of the following amounts is used in applying the terms under Our Limit: 1) The cost of repairing the property with materials of equivalent kind and quality to the extent practicable without deduction for depreciation; or 2) The amount computed after applying the Other Limitations shown below: In no event shall the payment under this endorsement exceed the actual cash value of the item or items damaged. (Actual cash value includes a deduction for depreciation, however caused.) 3) When the cost to repair or replace exceeds the lesser of $2,500 or 5% of the applicable limit of the damaged equipment; we will not pay more than the $2,500 or 5% of the limit until actual repair or replacement is completed. All other terms and conditions of this policy apply. NW /13

14

15 NORTHWEST G F MUTUAL INSURANCE COMPANY Outbuilding Exterior Wall Surfacing, Exterior Roof Surfacing, Exclusion The policy is amended to include the following terms. All other terms and provisions of the policy apply, except as amended by this endorsement. DEFINITIONS The following definitions are added, as pertains to this Exclusion: 1. COSMETIC LOSS OR DAMAGE means physical damage such as marring, scratching, denting, pitting, discoloration, or other condition that affects the appearance, but that does not impair the exterior surfacing ability from its intended function of keeping out the elements over an extended period of time. 2. EXTERIOR WALL SURFACING means a. a building s or structure s exterior wall cladding, including but not limited to blocks, bricks, logs, panels, shakes, shingles, siding, stones, stucco and tiles, regardless of the composition of the material; b. material applied to or under exterior wall cladding to protect against moisture intrusion; and c. materials used to secure; 1) exterior wall cladding; or 2) material applied to or under exterior wall cladding to protect against moisture intrusion; and d. exterior wall flashing. 3. Exterior ROOF SURFACING means a. a building s or structure s roof cladding, including but not limited to panels, shakes, sheeting, shingles and tiles, regardless of the composition of the material; b. materials applied to or under roof cladding to protect against moisture instrusion; c. roof doors, roof vents and roof turbines; d. roof flashing, all stripping & edging; and e. materials used to secure: 1) roof cladding; or 2) material applied to or under roof cladding to protect against moisture instrusion. EXCLUSION The following Exclusions are made a part of this policy when the policy declarations indicates the surfacing exclusion for cosmetic damage : 1. EXTERIOR WALL SURFACING : We do not pay for cosmetic damage to exterior wall surfacing caused by windstorm or hail damage when the windstorm or hail damage to exterior wall surfacing consists solely of cosmetic damage. 2. EXTERIOR ROOF SURFACING : We do not pay for cosmetic damage to exterior roof surfacing caused by windstorm or hail when the windstorm or hail damage to exterior roof surfacing consists solely of cosmetic damage. NW-CDF 12/13

16 NORTHWEST G F MUTUAL INSURANCE COMPANY Cosmetic Damage Exclusion to Roof Surfacing The Policy is amended to include the following terms. All other terms and provisions of the policy apply, except as amended by this endorsement. DEFINITIONS The following definitions are added, as pertains to this Exclusion: 1. COSMETIC LOSS OR DAMAGE means physical damage to any portion of the roof surfacing of a building such as marring, scratching, denting, pitting, discoloration, or other condition that affects only the physical appearance, but that does not impair the roof surfacing ability from its intended function of keeping out the elements over an extended period of time. 2. ROOF SURFACING means a. A building s or structure s roof cladding, including, but not limited to panels, shakes, sheeting, shingles and tiles, regardless of the composition of the material; b. Materials applied to or under roof cladding to protect against moisture intrusion; c. roof doors, roof vents and roof turbines; d. roof flashing, all stripping and edging; and e. materials used to secure: 1) roof cladding; or 2) materials applied to or under roof cladding to protect against moisture instrusion EXCLUSION The following Exclusion is made a part of this policy when the policy declarations indicates this endorsement adds the exclusion for cosmetic damage to roof surfacing : We do not pay for cosmetic damage to roof surfacing caused by windstorm or hail when the windstorm or hail damage to roof surfacing consists solely of cosmetic damage. NW-CDR 12/13

17