On the combined Property and Casualty exam, this topic gathers the coverages and markets that are not homeowners, auto, commercial property, CGL, BOP or workers compensation: umbrella and specialty liability, flood, marine and aviation, bonds, farm and crop, and the alternative markets (surplus lines, risk retention groups, residual markets) that exist when the standard market will not write a risk. The property-only and casualty-only exams cover the same ground in their "Other Property Insurance" and "Other Casualty" topics.

Umbrella and excess liability

• A commercial umbrella (ISO CU 00 01) sits above scheduled underlying policies, adds limits, drops down when an underlying aggregate is exhausted, and covers some claims the underlying policies do not, after a self-insured retention (SIR).
• A straight excess policy adds limits without broadening coverage.
• A personal umbrella requires the insured to keep stated underlying limits on auto and homeowners liability.

Professional, management and cyber liability

• Errors and omissions (E&O): professional mistakes, such as a financial advisor's negligent advice or an agent who fails to place requested coverage. Malpractice is professional liability for physicians and other health care providers.
• Directors and officers (D&O): claims against directors and officers (and often the entity) for wrongful acts in managing the organization.
• Employment practices liability (EPLI): wrongful termination, discrimination and harassment claims by employees.
• Cyber: first-party costs of a breach (notification, forensics, business interruption, extortion) and third-party liability to affected people.

Equipment breakdown

Equipment breakdown (boiler and machinery) insurance covers loss from the sudden mechanical or electrical breakdown of pressure, mechanical and electrical equipment, which commercial property forms exclude.

Flood and the NFIP

• Flood is excluded from homeowners and commercial forms. The federal NFIP is the main source of flood coverage; it is available only in participating communities that adopt floodplain management measures (42 U.S.C. 4012(c)).
• Mandatory purchase applies to buildings in Special Flood Hazard Areas with loans from federally regulated or insured lenders (42 U.S.C. 4012a).
• Limits (44 CFR 61.6): residential $250,000 building and $100,000 contents; non-residential $500,000 each.
• 30-day waiting period for new policies, except coverage bought in connection with making, increasing, extending or renewing a loan, which takes effect at the transaction (44 CFR 61.11).
• Flood means inundation of two or more acres of normally dry land or two or more properties (one the insured's).
• Contents are paid at ACV; a single-family principal residence insured to 80% of replacement cost (or the maximum) gets replacement cost on the building.
• Increased Cost of Compliance pays up to $30,000 to bring a substantially damaged building into compliance.
• A difference in conditions (DIC) policy fills gaps such as flood and earthquake for commercial insureds.

Marine and aviation

• Inland marine covers goods in transit over land, movable property and instrumentalities of transportation and communication (bridges, tunnels, piers, pipelines, towers). Examples: personal articles floaters for jewelry, fine art and cameras; jeweler's block (the store's stock, customers' items left for repair and consignment goods); transit coverage. Under ISO's inland marine conditions (CM 00 01) the insurer states its intentions within 30 days of the sworn proof of loss, and the parts condition pays only for the lost part.
• Ocean marine covers hulls, cargoes, earnings (freight) and liability. Protection and indemnity (P&I) is the vessel owner's liability coverage. General average is a sacrifice for the common good shared by everyone in the voyage; particular average falls on one owner. Jettison is throwing cargo overboard; barratry is the master's wrongful act without the owner's consent; perils of the sea include sinking and stranding in heavy weather.
• A yacht policy's hull coverage parallels ocean marine hull. A boat owners package combines physical damage, liability and medical expense for pleasure boats.
• Aviation insurance covers the aircraft (aircraft hull), the owner's liability to passengers, airports and others, and accident coverage on passengers.

Crime, fidelity and surety

• Fidelity bonds and crime policies protect an employer against employee dishonesty such as embezzlement.
• A surety bond has three parties: the surety guarantees to the obligee that the principal will perform, and can recover what it pays from the principal.
• Contract bonds: a bid bond guarantees the winning bidder will sign and furnish the required bonds; a performance bond guarantees completion; a payment bond guarantees subcontractors and suppliers are paid. The Miller Act (40 U.S.C. 3131) requires both performance and payment bonds on covered federal construction contracts; the payment bond protects everyone supplying labor and material.
• License and permit bonds guarantee compliance with the laws governing a licensed activity. Judicial bonds are used in court proceedings, such as guaranteeing a court-appointed fiduciary's duties.

Farm, crop and other specialty property

• A farmowners-ranchowners policy packages property and liability for the farm dwelling, farm structures, farm and personal property and operations.
• Multiple-peril crop insurance is subsidized and reinsured by the federal government (7 U.S.C. 1508).
• Mobile home policies adapt the homeowners program to the unit's construction, tie-downs and transport.
• Title insurance covers losses from title defects that already exist at the policy date, such as liens, rather than future events.

Alternative and residual markets

• Surplus lines: coverage from a nonadmitted insurer, used when admitted insurers will not or cannot write the risk. Surplus lines laws generally require the broker to make a diligent search of the admitted market first; the federal Nonadmitted and Reinsurance Reform Act (15 U.S.C. 8205) waives that search for exempt commercial purchasers. Details vary by state.
• Risk retention groups: liability insurers owned by members with similar exposures, authorized by the federal Liability Risk Retention Act of 1986 (15 U.S.C. 3901-3906).
• FAIR plans (Fair Access to Insurance Requirements): state pools, run with the insurance industry, that make property insurance available to owners unable to obtain it in the normal market. Not every state has one.
• Workers compensation assigned risk plans serve employers the voluntary market rejects, except in the four monopolistic states (North Dakota, Ohio, Washington, Wyoming), where employers buy from the state fund.
• Terrorism (TRIA): insurers must offer coverage for certified acts of terrorism on terms that do not differ materially from their other coverage; the federal program runs through December 31, 2027 (15 U.S.C. 6701 note).

Common traps

• Umbrella vs. excess: the umbrella can drop down and broaden coverage above an SIR.
• Surety = three parties, and the surety may recover from the principal; fidelity = employee dishonesty.
• Payment bond protects subcontractors and suppliers; performance bond protects the owner.
• P&I is marine liability; hull is the vessel.
• Surplus lines are written by nonadmitted insurers, after a diligent search where state law requires one.
• FAIR plans are not universal.