Agents learn early that there are two types of property, real property and personal property. Real property is generally defined as land and everything attached to the land such as by roots, by being embedded in the land, permanently resting on the land such as a building or property permanently attached to the building. Personal…
The concept of actual cash value (ACV) is far more complicated than “replacement cost minus physical depreciation.” In fact, the meaning of replacement cost differs based on the state. To further complicate the “problem” with defining ACV is whether or not labor is depreciable. Again, the answer differs based on the state in which the…
The Agreed Value Option (AVO) is an alternative to coinsurance in the ISO Building and Personal Property Coverage Form (CP 00 10). Agreed Value can be used with buildings or personal property, on either an actual cash value (ACV) or replacement cost (RC) basis. However, many agents are not aware of how this option must…
A surveyor’s equipment was stolen while on a job site. The adjuster denied the claim under the CP 00 10 Property Off-premises coverage, citing the exclusion for such property while on a premises you “own, lease or operate,” and claiming the insured was “operating” on the premises. Is this a correct interpretation?
A prospect’s lease requires that the tenant (him) be responsible for only the heating and air conditioning system (HVAC) under a provision that the tenant “maintain, repair and replace” the system. So I need to be certain that my insured’s policy has coverage for the HVAC system. Would the tenant’s improvements and betterments coverage in…
Building coverage includes personal property owned by you that is used to maintain or service the building or structure or premises, including: appliances used for refrigerating, ventilating, cooking, dishwashing or laundering. Does this apply to any laundry equipment (e.g., a public laundromat) or only if it is actually used to “service the building” (e.g., a…
If you insure the tenant of a building and they install improvements and betterments, you certainly want to make sure they’re adequately insured, particularly if the lease makes the tenant responsible for damages. However, if you insure the building owner, they must be just as vigilant in updating their coverage. Here’s why….
As every self-respecting Insurance Geek knows, one word in an insurance policy (in fact, even a punctuation mark…but that’s another story) can make all the difference in coverage or lack thereof. So, with apologies to Bill Clinton for the title of this article, let’s take a look at an actual claim that boiled down to a…
An I&B claim was denied because the owner of the leased area had not made any betterments or improvements at his own expense since the lease began…all of the improvements were made just prior to assuming the lease. His policy covers I&Bs “acquired” by the tenant. What does “acquired” mean?
Question: I have always understood Agreed Value to do away with the coinsurance clause. I have also understood it to stand alone, meaning no ACV or RC noted on the Dec. page for the particular item showing agreed value. Am I correct or mistaken? If I am correct in both instances, is it correct for…
