What it does
CM 99 02 modifies the Camera And Musical Instrument Dealers (CM 00 21) and Equipment Dealers (CM 00 22) coverage forms. It deletes their coinsurance condition and substitutes a reporting arrangement: within 30 days after each reporting period the dealer reports the premium base shown in the declarations, and the insurer computes premium using the declared rates for each premium adjustment period, comparing it with a deposit premium.
Who needs it
Dealers whose stock swings with the season, such as equipment dealers stocking up before planting season or music stores before the holidays. Reporting lets the dealer pay for actual values rather than insuring to peak values all year to satisfy coinsurance.
Key provisions
- Premium is adjusted against the deposit annually or applied against the deposit each period, depending on the adjustment period shown.
- A minimum annual premium applies.
- On cancellation the dealer reports values or the premium base to the cancellation date and premium is computed on that basis.
Quoting and selling notes
Reporting forms only work if the insured reports on time and accurately; explain how late or low reports affect claims and premium audits. Ask for 12 months of inventory values to set the deposit premium.
