Civil Authority Loss of Use Coverage

Under this coverage, additional living expense or fair rental value coverage is available for no more than two weeks if civil authority prohibits the insured from use of residence premises as a direct result of damage to neighboring premises by an insured peril. The loss of use coverages further provide that no coverage exists for loss or expense due to cancellation of a lease or other agreement. The loss of use coverages of homeowners policies issued by insurers that do not use the standard ISO HO 2 or HO 3 policy forms often are substantially similar to the standard form policies. Some insurers impose a 12-month maximum period for which additional living expense or fair rental value payments will be made. Others do not include such a fixed maximum period of recovery limitation. Some insurers’ policies base the availability of loss of use benefits due to order of civil authority on the existence of direct damage to a neighboring property that would constitute a covered loss under their respective policies. Others do not use the covered loss to adjoining property limitation at all. ADDITIONAL COVERAGES Homeowners policies contain several additional coverages, some of which relate to and are dependent on the existence of a covered building or contents loss and some of which are not. Many insureds probably fail to make claims that otherwise would be covered owing to the lack of knowledge that their policy covered such losses. These additional coverages are extensive, covering the better part of four pages in the ISO HO 2 and HO 3 policies, and include the following. Debris Removal The policy’s coverage includes the costs of removing debris of covered property resulting from a loss caused by an insured peril. The debris removal coverage also applies to costs of removal of volcanic ash, dust, or particles from a volcanic eruption that has caused a direct physical loss to covered buildings or contents. Loss of Use and Additional Coverages 59 Debris removal expenses are included within the policy limits unless the total damage equals or exceeds the policy limits. In that case, the policy will pay debris removal expenses in addition to the policy limit, subject to the maximum of 5% of the limit applicable to the damaged property. The debris removal coverage also extends to the costs of removal of the insured’s downed trees felled by windstorm, hail, weight of ice, snow, or sleet and neighbors’ trees felled by one of the policy’s named perils, if one of two circumstances exist: 1. the felled tree damages a covered structure or 2. the felled tree blocks a driveway, handicapped access ramp, or fixture. This coverage is subject to a maximum of $1,000 for any one loss and a $500 maximum for the removal of any one tree. These amounts are payable in addition to the policy limit. Reasonable Repairs The heading for this category of additional coverages is not generally descriptive. These are really two distinct coverages. First, the policy covers the reasonable costs incurred by the insured to protect covered property that has been damaged by a covered peril from further damage. Second, if the measures taken by the insured to prevent further damage also involve repair costs, those repair costs will be covered. Again, the property in question must be covered property and the damage must have been caused by a covered cause of loss. Neither of these coverages increases the policy limit applicable to the damaged covered property. Nor do these provisions relieve the insured of any of his or her duties stated in the policy’s conditions, which include keeping accurate records of expenses, including repair expenses. 60 The Complete Book of Insurance Trees, Shrubs, and Other Plants The standard ISO HO 2 and HO 3 policies also provide up to 5% of the dwelling policy limit for loss to trees, shrubs, plants, or lawns at the residence premises caused by the perils of: ◆ fire or lightning; ◆ explosion; ◆ riot or civil commotion; ◆ aircraft; ◆ vehicles not owned or operated by residents of the residence premises; ◆ vandalism and malicious mischief; or, ◆ theft. This coverage is in addition to the dwelling policy limit and is subject to a maximum of $500 for any one tree, shrub, or plant.

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