Class 9 Insurance and Risk Management

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Class 9Insurance and RiskManagement

• George D. Krempley
• Bus. Fin. 640
• Winter Quarter 2007

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Overview of Homeowners 2000 Program

• HO-2 (broad form) covers the dwelling, other
  structures, and personal property on a named
  perils basis.
• HO-3 (special form) covers the dwelling and
  other structures on a risk-of-direct-physical
  loss basis. All direct physical losses are
  covered except those losses specifically
  excluded. Personal property is covered on a
  named perils basis.
• HO-4 (contents broad form) covers a tenants
  personal property on a named perils basis.
• HO-5 (comprehensive form) provides open perils
  coverage (all-risks coverage) on the dwelling,
  other structures and personal property. All
  direct physical losses are covered except those
  losses specifically excluded.
• HO-6 (unit owners form) covers personal property
  on a named perils basis. A minimum of 5,000 of
  insurance is also provided on the condominium
  unit that covers improvements and additions.
• HO-8 (modified coverage form) designed for older
  homes. Dwelling and other structures are based
  on the amount required to repair or replace using
  common construction materials and methods.

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Overview of HO 3 Coverages

• Section I Property Coverages
• Coverage A Dwelling
• Coverage B Other Structures
• Coverage C Personal Property
• Coverage D Loss of Use
• Additional Coverages
• Section II Liability Coverages
• Coverage E Personal Liability (100,000 per
  occurrence)
• Coverage F Medical Payments to Others (1000
  per person)

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EXHIBIT 8.1 Comparison of ISO Homeowners
Coverages
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EXHIBIT 8.1 (continued) Comparison of ISO
Homeowners Coverages
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EXHIBIT 8.2 Special Limits of Liability
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INSIGHT 8.2 Estimated Total Number of Mold
Claims in Texas
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INSIGHT 8.4 The Big Gap Between Replacement Cost
and Actual Cash Value Can Empty Your Wallet