What it does
CP 04 02 modifies the Building and Personal Property, Condominium Association and Condominium Commercial Unit-Owners forms and the business income and extra expense forms. For property in its Schedule, it pays covered costs attributable to Green Upgrades after covered direct physical loss. Green upgrades means using environmentally preferable, efficient or sustainable materials, equipment and methods in place of the damaged non-green property.
How payment is calculated
- Start with the amount of covered direct loss before the deductible, excluding the green increase itself.
- Multiply that amount by the scheduled Increased Cost of Loss percentage.
- Pay the least of the actual cost of the green upgrades, that percentage amount, or the scheduled Green Upgrades maximum.
- Special rules apply when the underlying loss falls within the deductible.
- A separate scheduled amount covers Related Expenses: waste reduction and recycling, design and engineering professional fees, certification fees and related equipment testing, and building air quality measures. It is excess over any other coverage for the same expenses.
- An extended period of restoration, in days, applies for time-element coverage when green rebuilding takes longer.
Quoting and selling notes
- Ask whether the client has sustainability commitments, certified buildings, or local energy codes likely to require upgrades after a loss.
- Code-required upgrades are mainly an ordinance or law exposure (CP 04 05). This endorsement covers voluntary or certification-driven green choices.
- Forms lists show 10 12 as the current edition in most states, with an 09 09 edition in Florida and Hawaii.
