BUILDING AND PERSONAL PROPERTY COVERAGE FORM ANALYSIS

A. COVERAGE

The coverage form obligates the insurance company to pay for direct physical loss or damage to certain types of property. The property must be at a location listed or described on the declarations. However, this is not open-ended coverage. The loss or damage must be the result of a cause of loss described in the causes of loss form attached to the policy for coverage to apply.

Coverage applies to only loss or damage that occurs at a definite place and time. There is no coverage for a loss event that is not tangible, or that is not capable of being measured.

The reference to premises means that coverage applies to only property located in or on the premises listed or described on the declarations. This is why the declarations is a very important document. Coverage does not apply if the location and type of property is not properly listed or described.

1. Covered Property

Covered Property is defined in two ways. In the first, the coverage form lists the types of property eligible for coverage. In the second, it provides information on the types of property not eligible for coverage. One way to determine if an item is covered is to take the following steps:

Step 1. Is the item described in the listings provided under Building, Your Personal Property, or Personal Property of Others? If the answer is no, there is no coverage. If yes, continue to Step 2.

Step 2. Is there a limit of insurance on the declarations for the qualifying type of property? If the answer is no, there is no coverage. If the answer is yes, continue to Step 3.

Step 3. Is the item of the type of property described in Property Not Covered? If the answer is yes, there is no coverage. If the answer is no, this coverage form should cover that item.

a. Building

Building is the first type of covered property. The following property is covered in addition to the actual building or structure listed on the declarations:

• Completed additions
• Permanently installed machinery and equipment
• Owned personal property used to maintain or service the building
• Two other types of property are covered but only if not covered elsewhere:
• Additions being built. Alterations and repairs to the building or structure are also included.
• Any materials, equipment, supplies, and temporary structures situated on the described premises or within 100 feet of it. These are building only if they are to be used to make additions, alterations, or repairs to the building or structure specifically described.