1. Forms
2. CM
3. CM-26-02

What the form is

The CM 26 02, titled "Additionally Covered Property," is an endorsement to the Commercial Inland Marine Physicians and Surgeons Equipment Coverage Form (CM 00 26). Its primary function is to add or enhance coverage for specific types of property and expenses that might otherwise have limited or no coverage under the base policy. This endorsement typically itemizes these additional coverages and provides separate limits of liability for each, which are in addition to the main policy limits. It often modifies or expands upon the Coverage Extensions section of the underlying equipment coverage form.

Classes of business it applies to

This endorsement is designed for healthcare professionals and practices that are eligible for and insured under the Physicians and Surgeons Equipment Coverage Form. This includes, but is not limited to:

• Physicians' offices
• Dental practices
• Surgical centers
• Other medical clinics or facilities that own or are responsible for specialized medical and office equipment.

Real-world examples:

• A doctor's office uses this endorsement to cover a laptop containing patient records that is temporarily taken off-premises for work. If the laptop is stolen from the doctor's car, this endorsement could provide coverage up to its specified limit.
• A dental practice suffers a small fire, and while their dental equipment is being repaired, they incur extra expenses to rent temporary office space and equipment to continue seeing patients. The "Extra Expense" coverage within this endorsement could help cover these costs.
• An employee's personal belongings are damaged by a covered water leak at a medical clinic. The "Personal Effects" coverage might apply.

Special considerations

• Specific Limits: The endorsement will show specific limits for each additionally covered property or expense category. Common coverages and example limits (which can vary by insurer or edition) include:
  • Office Equipment Temporarily Off-Premises (e.g., $2,500 for up to 30 days)
  • Extra Expense to Continue Normal Office Operations (e.g., $2,500)
  • Personal Effects of the insured, officers, partners, members, managers, and employees, or personal property of others in the insured's care, custody, or control (e.g., $2,500)
  • Books of Account (e.g., $2,500)
• Coinsurance: Some versions or analyses of this endorsement indicate that it may delete the coinsurance provision from the Physicians and Surgeons Equipment Coverage Form. This is a critical point, as it would mean property should be insured to 100% of its value to avoid underinsurance issues, though the specifics should always be verified by reviewing the particular endorsement used.
• Additional Insurance: The limits provided by this endorsement are typically additional amounts of insurance and do not reduce the overall limit of liability stated in the declarations for the primary covered property, but apply specifically to the items endorsed.

Key information for agents and underwriters

• Needs Assessment: Agents should discuss with their physician and surgeon clients whether the standard coverage extensions in the CM 00 26 are adequate or if the specific additional coverages and limits offered by CM 26 02 are necessary to address their unique exposures, such as frequent off-premises equipment use or high potential extra expenses.
• Risk Assessment: Underwriters should evaluate the specific additional risks being assumed. For example, the frequency and value of equipment taken off-premises, the nature of personal effects likely to be on site, and the business continuity plans that might drive extra expense claims.
• Coverage Gaps: This endorsement helps fill potential coverage gaps for ancillary property and expenses that are important for the functioning of a medical or dental practice but may not be the primary focus of the main equipment coverage.
• Pricing: The premium for this endorsement will reflect the additional limits and types of coverage provided. The potential deletion or modification of the coinsurance clause on the main form (if applicable) is a significant underwriting consideration that could also impact overall pricing and risk assessment for the policy.
• Clarity of Limits: Ensure that the declarations page clearly reflects the separate limits applicable to each coverage provided by the CM 26 02 endorsement.