AAIS PHOTOGRAPHIC EQUIPMENT COVERAGE FORM ANALYSIS
(August 2025)
|
IM 1355–Schedule of Coverages–Photographic
Equipment IM 1350–Photographic Equipment Coverage
Analysis |
The American Association of
Insurance Services (AAIS) Photographic Equipment Coverage insures cameras and all forms of photographic
equipment. Projection machines, movable sound equipment, and related
accessories can also be covered. Photographic equipment the named insured owns is
covered, as is the similar property of
others in the named insured’s care, custody, or control.
Any commercial or non-profit
organization wanting coverage for photographic equipment may purchase this
policy. However, coverage does not include television cameras and equipment,
coin-operated cameras, cameras and equipment owned by dealers or manufacturers,
or aerial or radar cameras.
AAIS Photographic Equipment
Coverage requires at least these four forms:
Related Article: CL 0100 AAIS Commercial
Lines Common Policy Conditions
This Schedule of Coverages is
used with IM 1350–Photographic Equipment Coverage. IM 1355 contains the
following information:
Coverage can be written
on a blanket basis, covering all photographic equipment under a single
insurance limit. That limit is entered in the space
provided.
NOTE: If certain
items are scheduled separately, their value should be deducted from the blanket
to avoid double billing. Items included in the blanket coverage are subject to
100% coinsurance.
Coverage can be written
on a scheduled basis. Each piece of equipment's description and limit are
entered in the spaces provided.
This is the amount the
named insured retains for each covered loss. It must be entered in the space provided.
IM 1251–Named Perils
Coverage is the only optional endorsement available. If selected, it changes
the perils covered in the coverage form from risks of direct physical loss to
only the perils of fire, lightning, windstorm, flood, and theft.
NOTE: There are only
five named perils, which significantly reduces coverage when this endorsement
is used. However, the covered perils are the primary perils most insureds would
be concerned about.
Photographic Equipment Coverage is typically written on
a non-reporting basis. This section includes spaces to enter the annual
premium, the non-reporting rate per $100, and any applicable minimum premium.
This analysis is of the 01 05
edition.
This section states that the insurance company provides the coverage
described in exchange for the named insured paying the required premium. This
agreement is subject to all the terms of the coverage form, the schedule of
coverages, and any additional conditions that apply. Endorsements or additional
schedules included in the schedule of coverages also apply.
There is a statement indicating that certain words and phrases
highlighted in bold print in the coverage form are defined in the Definitions
section immediately following this Agreement.
NOTE: The schedule
of coverages does not have a clearly designated space to list endorsements or
additional schedules that apply at inception.
Defined words are used
throughout the coverage form. When these terms appear in the coverage form, the
meaning provided in this section must be applied.
NOTE: The Editors added
titles to enhance clarity.
The
parties specifically listed on the declarations as insureds.
The
insurance company providing the coverage.
The applicable coverage
amount.
Any page labeled as
such that includes coverage details, including declarations or supplemental
declarations.
A sinkhole occurs
when the earth’s surface suddenly sinks or collapses into an underground cavity
formed by water erosion on limestone or other rock types. This definition of
sinkhole collapse excludes considerations of the land value or expenses involved
in filling sinkholes.
The definition contains the following
specifically named perils:
•
aircraft
•
civil commotion
•
explosion
•
falling objects
•
fire
•
hail
•
leakage from fire extinguishing equipment
•
lightning
•
riot
•
sinkhole collapse
•
smoke
•
sonic boom
•
vandalism
•
vehicles
•
volcanic action
•
water damage
•
weight
of sleet, snow, or ice
•
windstorm
Two terms require
further clarification:
This coverage does
not extend to personal property stored outdoors. Additionally, it does not
cover damage to the interiors of buildings or personal property stored inside
buildings unless a falling object first breaches the building's exterior.
This refers to the
sudden or accidental release or leakage of water or steam. However, it must
directly result from a crack or break in a part of the system or appliance that
contains the water or steam.
All provisions, limitations, exclusions, conditions, and definitions
relevant to the coverage provided.
An airborne volcanic
blast or shock wave, which also includes ash, dust, and particulate matter, as
well as any lava flow. The term does not include the expenses for removing
dust, ash, or particulate matter from the covered property unless there
is direct physical damage to the property.
The insurance company covers
property described below unless it is excluded or subject to limitations.
a. Coverage
Direct
physical loss caused by a covered peril to the insured’s photographic equipment
and similar property of others under its care, custody, or control, as listed
on the coverage schedule with a description and limit.
b. Coverage Limitation
Coverage applies only
to the photographic equipment and similar
property of others shown on the schedule of coverages.
Direct
physical loss caused by a covered peril to photographic equipment and similar
property belonging to others and under the care, custody, or control of the
insured is covered, provided there is a limit for blanket coverage shown on the
schedule coverages.
Coverage is limited to the
following:
·
Cameras and
photographic equipment. Projection machines and related accessories used with
the projection machines are included in this item, provided they are used
commercially.
NOTE: The reference to commercial use could apply to all
camera and photographic equipment, but the sentence structure links the
commercial use solely to the projection machines.
·
Mobile sound
equipment used to record and reproduce sound for
motion pictures.
·
Accessories
such as lenses, filters, tripods, camera bags, negative film, batteries, and flash
units.
There is
no coverage for the following property:
Property illegal to possess is not covered. Additionally,
property that is legally owned but used in illegal trade or transported
unlawfully is also excluded.
Coverage for physical
damage to covered property, when caused by a covered peril, applies
automatically for newly acquired photographic
equipment.
The limit is either $10,000 or 25% of
the highest limit shown on the schedule of coverages, whichever is less.
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Example: Magnify Advertising has a $100,000 blanket limit for photographic equipment. The art director
purchases $20,000 of equipment from an estate sale on Saturday. She is in a
car accident on the way to the office. The equipment was destroyed in the
accident. When Magnify files a claim, only $10,000 is paid. |
Coverage for newly
acquired instruments is automatically included, but this coverage is limited to
a maximum of 30 days. During this period, the insured must report the
acquisition to the insurance company. If not reported, coverage will end after
30 days. However, coverage will also end before the 30 days if the policy
expires or once the new acquisition is reported to the insurance carrier.
This is not free
coverage. The premium for the newly acquired photographic equipment is based on
the date of acquisition.
This coverage is part of the limit for
the coverage described under Property Covered, not in addition to it.
Coverage applies to
risks of direct physical loss unless the loss is limited or caused by an
excluded peril.
Coverage
for collapse is provided when caused by one or
more of the following:
Collapse
refers to the sudden and unexpected sinking or caving in of a building,
structure, or parts of it, making the structure unusable for its intended
purpose.
The
following buildings and structures are not considered to be in a
state of collapse:
The covered property
limit does not increase for this coverage.
a. Civil Authority
There is no coverage
for loss resulting from an order issued by any civil or government
authority. These orders may include seizure, confiscation, destruction, or
quarantine of property, but this list is not exhaustive. The only exception is
when a civil authority destroys property to control a fire that causes loss or
damage. This exception applies only if the fire is caused by a covered peril.
b. Nuclear Hazard
The insurance company does not
cover loss or damage from any nuclear reaction, radiation, or contamination,
whether the incident was controlled or not, or caused by any means. Any loss
caused by the nuclear hazard is not considered a fire, explosion, or smoke
loss. However, coverage does include direct loss or damage caused
by fire resulting from the nuclear hazard.
c. War and Military Action
The insurance company does not
cover loss or damage caused by any act
of war. This includes undeclared wars, civil wars, or warlike actions by
military forces, all of which are considered war. Additionally, measures taken
to hinder or defend against actual or expected attacks by any government or
sovereign authority using military personnel or agents are also classified
as war and are not covered.
NOTE: This means the exception for fire resulting from a
nuclear hazard does not apply when it is caused by war.
The second group of exclusions pertain
to loss or damage caused by or resulting from specific events listed below.
Some of these exclusions include exceptions, conditions, or limitations
that should be noted and carefully reviewed. The insurance company will
not cover any loss or damage caused by or resulting from any of these events.
a. Acts or Decisions
There is no coverage for losses caused by or resulting from acts or
decisions made by any person, organization, or government entity. This
exclusion also applies to instances where there is a failure to act or decide.
However, there is an exception to this exclusion. If an act or decision,
or a failure to act or decide, leads to a covered peril, then the loss or
damage caused by that peril is covered.
b. Animal Nesting, Infestation, or Discharge
Coverage does
not apply to loss or damage due to nesting, infestation, or the discharge or
release of waste, secretions, or other substances by animals. In this context,
animals include, but are not limited to, birds, insects, and vermin. However,
if any of these excluded events result in a covered peril, the loss or damage
that peril causes is covered.
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Example: Magnify
Advertising is filming in a national park. One day, while the crew is
scouting locations, a family of bears invades and destroys the campground.
The ruined camera equipment is covered because the damage was caused by
animals, not related to nesting, infestation, or discharge. |
Loss or damage caused by the
breaking of glass objects or items primarily made of glass is
not covered. Additionally, there is no coverage for loss or damage caused by
property being marred, scratched, or exposed to light.
However, the following are
exceptions:
·
Breakage of
lenses is not excluded.
·
If any of
the excluded events lead to a specified peril, theft, or attempted theft, the
loss caused by these perils is covered.
·
Property
damaged by any of these events is not excluded if it is in the custody of a
carrier for hire.
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Example: Magnify
was happy that its camera equipment was covered for the bear damage until it was
informed the damage to items that were only marred
or scratched was not covered. However, the damage to the smashed lenses is
covered, even though they were glass. |
Loss
caused by collapse is not covered unless the collapse is included under Other
Coverages - Collapse, in which case coverage applies. Additionally, if an
excluded collapse results in a covered peril, coverage extends to the damage or
loss caused by that peril.
Loss
or damage caused by contamination or deterioration is excluded. This
includes corrosion, decay, fungus, mildew, mold, rot, and rust. It also applies
to any quality, fault, or weakness in the covered property that leads to
self-damage or destruction. This exclusion is not limited to just these particular causes. However, if contamination or
deterioration results in a covered peril, the resulting loss or damage from
that peril is covered.
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Example: When
the Magnify crew returns from the park, a box of equipment is left behind. When the equipment is
inventoried, the mistake is realized. The park ranger is notified, and the
box is located and shipped back to Magnify. Unfortunately, most of the items
have been damaged because they had been left out and exposed to the elements.
This loss is not covered. |
Coverage does not apply
to loss caused by, or resulting from, criminal, fraudulent, dishonest, or
illegal acts committed by any of the following, whether alone or in collusion
with others:
·
The
named insured
·
Others
with an interest in the property
·
Others
to whom the property has been entrusted
·
The
named insured's partners, officers, directors, trustees, joint venturers,
members, or managers, as applicable, based on the named insured’s type of
business organization
·
Employees
of any of the groups listed above. Employees are excluded even if the act
occurs when they are not considered to be working.
However, this exclusion
does not apply to the property covered in the care of a hired carrier.
An important provision is that this exclusion applies both
on and off the designated premises, regardless of negligence. However, if loss
or damage from one of these events results in a covered peril, then the loss or
damage caused by that peril is covered.
Coverage does not apply to losses from delays, loss of use,
or loss of market.
|
Example: Magnify is unable to complete its park photo shoot until
one of the damaged lenses is replaced. This results in a three-week delay,
which causes a delay in the ad campaign. Magnify is forced to pay contract
delay penalties to its client. These penalties are not covered. |
j. Voluntary Parting
k. Wear and Tear
Loss or damage caused
by wear and tear is not covered. However, if wear and
tear leads to a covered peril, the resulting loss or
damage from that peril is covered.
l. Weather
Additionally, there is no coverage for repairs or emergency
measures taken for property not already damaged by a covered peril.
NOTE: It is important to realize that any such costs
incurred will reduce the amount available to pay the actual loss.
The proof of loss must also specify the named insured’s
interest and the interests of others in the property involved, including liens
and mortgages. Any changes to the title of the property during the policy
period must be disclosed, along with any other reasonable information the
company may need, such as inventories, specifications, and estimates for
settling the loss.
The
value of the covered
property is its actual cash value on the date
of loss. Actual Cash Value is replacement cost new minus depreciation. This
item is subject to items 2. through 4. of this section.
The
property listed as scheduled property on the schedule of coverages is valued at
the specified limit for that particular property.
The value of a loss
involving damage or loss of one item from a pair or set is determined by a
fair proportion of the total value of the entire pair or set. However, losing
one part of a pair or set does not constitute a total loss.
NOTE: This recognizes the value of the whole is
greater than the value of individual parts, but the remaining part still has
value as a separate.
The value of a lost
or damaged part, which comprises several parts, is determined by the cost to
repair or replace just the lost or damaged part.
NOTE: This recognizes that the whole is more
valuable than the sum of its parts, but the individual parts still retain value
on their own.
The insurance company will not pay more than the
insured's insurable interest in the covered property at the time of loss.
The insurance company pays only the amount of loss
exceeding the deductible amount shown on the Schedule
of Coverages.
The insurance company
pays the least of the following, subject to items 1., 2., 3. and 5. in this
section:
This provision pertains
exclusively to covered property written on a blanket basis.
The insurance company
will not pay the full amount for any loss if, at the time of the loss, the
total value of all covered property—excluding property in transit—exceeds the
insurance limit. The steps the company takes to determine the amount paid are as
follows:
Step 1: Determine the
value of all covered property subject to coinsurance at the time of the loss,
except for items in transit.
Step 2: Multiply Step 1 by the
coinsurance percentage of 100%.
Step 3. Divide the limit for the
covered property subject to coinsurance by the result determined in Step 2.
NOTE: Stop here if the
result is 1.00 or higher because no coinsurance penalty applies. Go to Step 4
only if the result is less than 1.00.
Step 4. Multiply the total amount of
loss, prior to the application of a deductible, by the percentage determined in
Step 3.
Step 5. Subtract the applicable
deductible from Step 4.
The insurance company does not pay more than the
amount determined in Step 5. or the limit of insurance, whichever is less. It
does not pay any part of the remaining loss.
The insurance company has loss payment options if a
covered loss occurs.
·
Pay the value of the property
that sustained loss or damage.
·
Pay the cost to repair or
replace the property that sustained loss or damage.
·
Rebuild, repair, or replace the
property with similar property, to the extent possible, and it must be
accomplished within a reasonable period of time.
·
Take any part or all of the property based on the value agreed upon or
determined through appraisal.
The insurance company is required to inform the named
insured of its intent to rebuild, repair, or replace
within 30 days after receiving a properly completed proof of loss.
The insurance company
settles all claims with the named insured. It will also only pay the named
insured, unless a loss payee is listed on the policy.
The insurance company
settles a covered loss within 30 days of receiving a properly
prepared proof of loss, and the loss amount is confirmed. The amount is
determined either through a written agreement with the insured or after an
appraisal award is filed with the company.
The insurance company
can adjust and pay losses involving others' property to either the named
insured on behalf of the property owner or directly to the property owner.
The insurance company
is not obligated to pay the named insured if it has already paid the property
owner. Additionally, if the property owner sues the named insured, the company
can choose to defend the named insured in the lawsuit.
The insurance company and the insured
may not always agree on the value of a
covered claim. This condition
provides a way to resolve disputed claims.
Either party can
request an appraisal to determine the value of the disputed claim. Once a
request is made, both parties have 20 days to choose their own independent
appraisers and notify the other party of their appraiser's name. The two
appraisers then have 15 days to select a competent and impartial umpire. If
they cannot agree on an umpire within that time, either party can ask a judge
in the court of record in the state where the property is located to appoint
one.
The appraisers will
then determine the value of the claim and submit any differences to the umpire.
Once any two of the three parties (the two appraisers and the umpire) agree,
the amount of loss is finalized.
Each party is responsible for paying their own
appraiser, while the costs associated with the umpire and other shared expenses
are divided equally between both parties.
The insurance does not provide any benefit, directly or
indirectly, to any party with custody of the insured's
property.
Any condition in this coverage form that conflicts with any
applicable law is amended to conform to that law.
This condition is applicable only when the
insured is an individual.
When the named
insured passes away, the individual in custody of the insured's property
remains an insured for that property until a qualified legal representative is
appointed. After the appointment of the legal representative, that person
becomes an insured, but only for the property covered under this policy.
This coverage does not extend past the policy’s
expiration date.
Any revisions to this
coverage form or applicable endorsements that become effective during the
policy period or within six months of the coverage effective date that broadens
coverage without an additional premium will apply to this policy.
This
coverage is void if any insured at any time willfully concealed or
misrepresented a material fact that relates to the insurance provided, the
property covered, or its interest in the property. It is also void if any
insured engaged in fraud or false swearing with respect to the insurance
provided or the property covered.
NOTE: The named insured must
deal with the insurance company honestly. Its rights of recovery may be voided if it intentionally misrepresents or conceals a
material fact or information. This means the insurance is treated as simply
having never existed versus a particular claim being denied.
Only covered losses occurring during the policy period are
paid.
Payment of the loss
does not end the obligations of the named insured and the insurance company
toward each other. Additional provisions apply if the insurance company pays a
loss and the lost or damaged property is later recovered, or if the responsible party for the loss reimburses for the
damage.
Either party that
recovers property or payment must notify the other. Recovery expenses incurred
are reimbursed first. If the named insured keeps the recovered property, they
must repay the amount the insurance company paid on the claim, unless the company
agrees to a different amount.
If the paid claim is
less than the agreed-upon loss due to a deductible or other limit, any recovery
is prorated between the named insured and the insurance company based on the
company's respective interests in the loss.
Payment of a claim does not reduce the limit available for
future claims.
The insurance company
gains the right of recovery from third parties on behalf of the named insured
after paying a loss. The named insured is required to assist the company in
securing these rights. The company is not required to pay the loss if the named
insured obstructs or weakens its subrogation rights.
The named insured can agree in
writing to waive recovery rights from any party, but only if this is done
before a loss occurs.
The insurance company
cannot be sued by anyone for any coverage until all the terms of the coverage
form have been met. Suits must be brought within two years after the named
insured first became aware of a loss. If a state law invalidates this condition, any suit brought
must comply with that law’s provisions and begin within the shortest period of time allowed by law.
NOTE: It is common
for a basic coverage form to be modified by required state-specific
endorsements that address issues related to that state.
There are no
territorial limits. Property is covered regardless of its location.
AAIS has developed one endorsement
to use with Photographic Equipment Coverage.
This endorsement
modifies the coverage form's perils covered, limiting it to only: fire,
lightning, windstorm, flood, and theft.
It is important to note
a key limitation regarding theft: coverage for theft from vehicles is only
applicable if the vehicle was locked with the windows closed at the time of the
theft, and there are visible marks of forced entry.
Records should be maintained to identify
who is usually responsible for certain photographic equipment
instruments. The way the equipment is stored and secured when not in use is an
important issue to consider. It is necessary to determine which parties have
access to locked storage areas and hold the keys for entry. Additionally, when
equipment needs to be at other locations, it is essential to ensure it is
properly secured and protected from damage or theft during those times.