What it does
CP 13 10 modifies the Building and Personal Property and Condominium Commercial Unit-Owners coverage forms and the Standard Property Policy. Instead of a coinsurance percentage, the Declarations show a reporting symbol: DR (daily), WR (weekly), MR (monthly), QR (quarterly) or PR (policy-year). The insured files reports of values after each reporting period and at expiration, showing values separately at each location. The premium is adjusted to the reported values.
Key provisions (04 02 edition)
- Covered property is extended to personal property at "reported locations", "acquired locations" and "incidental locations" that have limits in the Declarations or on the Reported – Acquired – Incidental Locations Schedule. Property at fairs or exhibitions is not covered.
- Full reporting: replaces coinsurance. If the last report for the location showed less than full value, the insurer pays only the proportion of the loss that reported value bears to actual value on the report dates.
- Failure to submit reports: if the first report was never filed, payment is capped at 75% of what would otherwise be paid, and only at locations shown in the Declarations. If a later report is missing, payment at a location cannot exceed the values last reported there, and only reported locations are covered.
- "Specific insurance" on the same property must be included in reports and is subtracted when computing premium.
- Limits still cap the insurer's payment. The limit must be set high enough for peak values.
Quoting and selling notes
- Value reporting suits clients with large swings in inventory. They pay for actual average values rather than peak values all year.
- Clients must have the discipline to report accurately and on time. Missed reports can be costly. Set calendar reminders and assign responsibility.
- For predictable seasonal peaks at one location, Peak Season Limit of Insurance (CP 12 30) is simpler.
- The 04 02 edition is the current edition shown in forms lists for all states.
