U. S. P. PORTFOLIO CALIFORNIA ... - Superior Accessadb4.superioraccess.com/KB/Private/Guidelines...Trampolines, unfenced swimming pools. SPP Must have certified jewelry appraisals

THE GLENS FALLS INSURANCE COMPANY ENCOMPASS INSURANCE COMPANY

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U. S. P. PORTFOLIO CALIFORNIA: UNDERWRITING GUIDELINES


Effective: 01/15/05

AUTO RISK PROFILE - (CALIFORNIA) Good Drivers:

Glens Falls recognizes its responsibility to write automobile coverage for all Good Drivers, as defined by California Law. Glens Falls will write an automobile coverage for Good Drivers who submit fully completed applications.

Non-Good Drivers:

Glens Falls is generally not a market for drivers who do not qualify as Good Drivers under California law. However, Glens Falls will accept operators licensed less than three years provided they have no accidents or violations, are written along with a Good Driver (e.g., a family account) and no restricted vehicles are in the household*.

Refer to Rule F. in the auto section 2 for exceptions.

*Restricted Vehicles Acura NSX, AMC/Jeep CJ5, CJ7, Wrangler, Aston Martin, Avanti, Bentley, Bricklin, Buick GNX, Gran National, Chevrolet Camaro, Z28/Iroc Z, Camaro 8cyl. Chevrolet Corvette, Cobra, DeLorean, Dodge Stealth, Dodge Viper, Eagle Talon TSI, Excalibur, Ferrari, Ford Mustang SVO/GT/5.0 ltr/Cobra/8 cyl., Geo Tracker, GMC Syclone/Typhoon, Kia Sportage 2-door; Jensen Interceptor, Lamborghini, Lancia Scorpion , Lotus, Maserati Mazda RX-7, Mitsubishi 3000GT/Eclipse GSX Turbo, Morgan, Nissan 300ZX Turbo, Pantera, Plymouth Laser RS Turbo, Pontiac Trans Am/Formula, Firebird 8 cyl., Porsche, Rolls Royce, Suzuki Samurai, Sidekick, Vitara, Toyota Supra Turbo/MR-2 Supercharged, TVR, Zimmer or vehicle modified to enhance performance or with an altered suspension (raised or lowered from factory design)


Effective: 01/15/05

HOME RISK PROFILE - CALIFORNIA Owner Occupied

Minimum Value Primary Dwelling – Zone - A $150,000* Refer to

complete Underwriting Guides for definition. Zone B - $125,000

Seasonal/Secondary - $100,000

Condo - $40,000

Tenant - $40,000

Rented to Others Minimum Value

$125,000 Dwelling Fire Segment

Maximum Value $4,000,000 (Protection Class 1-8)

ITV Must be written at 100% replacement cost.

Protection Class Must be PC 1 – 8

Number of Families Must be 1 to 2 families owner occupied; 1 to 4 families rented to others. Dwelling Fire residences over $500,000, refer to underwriting.

Rentals: Maximum of 4 locations.

Glens Falls or another Encompass Insurance underwriting company must write supporting Homeowners.

Account Loss Activity 1 Property loss subject to the following:

-One theft loss < $500.

-One water loss. Water loss over $1000 requires proof of remediation. Location is ineligible for mold coverage. Any location with prior mold loss is ineligible.

-Loss resulting from an act of nature is acceptable.

-No other claims in the past 3 years. Does not include claims closed without payments. Losses include both catastrophic and non-catastrophic.*

• Exception: Applicants with prior losses to the dwelling structure in the past 3 years (at the residence to be insured) may be written with full documentation,* prior to binding, if the hazard or any other unusual exposure has been remedied.

• This exception does not apply to theft and liability losses. New applicants with prior theft or liability losses cannot be written except for those losses previously noted above. In most cases, we will accept renewable existing customers with a theft or liability loss (no mitigation documentation is necessary).

• * See complete Underwriting Guidelines for a list of acceptable risk mitigation documentation, Section J.

Minimum Deductible $500

Maintenance Homes must be well maintained. Must have updated roof within last 20 years (unless Slate or Tile). Homes > 49 years old must have copper or PVC plumbing and electrical service must be controlled by circuit breakers with minimum 100 AMP service.

Woodstove Must be an owner occupied dwelling, professionally installed and not primary heat source. Encompass Insurance questionnaire completed and retained by agent.

Coastal Must be > 1,500 ft. from ocean shore and >15 ft. above mean high tide and must be located on the non-ocean side of the first inland street.


Effective: 01/15/05

Brush Must be over 1,500* ft. from brush. Ineligible if located in brush area. Roofs must be other than wood if located in any county south of Kern and San Luis Obispo counties; if located in the rest of the state, wood roofs must meet the following criteria:

-Located more than 1/2 mile from brush. -Located in protection class 8 or better.

-Roof age 20 years or less. *Acceptable if over 1,000 feet if the home meets the following criteria: -No composition roof -Stucco only exterior -Minimum value $200,000 -Primary residence only -0 prior losses in the last 3 years -All other criteria acceptable -Brush must be light and intermittent

Central Alarms Must have for Owner Occupied Dwelling - $750,000 or greater; $750,000 Rented to Others; Condo/Tenant - $250,000; SPP - $300,000.

Foundation Must be closed; no piers or pilings. The foundation of the home must be built on less than a 20-degree slope.

Ineligible Exposures Mobile//Manufactured Homes, exotic pets or animals in household with bite history. Trampolines, unfenced swimming pools.

SPP Must have certified jewelry appraisals for single items $25,000 or greater. Must have appraisals for all single items other than jewelry $50,000 or greater. Refer to underwriting guidelines.

Boats Must be < $125,000 current book value, < 40 ft. length, and < 55 mph. Must meet auto operator requirements and have 2 years boat experience. Jet skis and waverunners are ineligible.

Business on Premises Refer to complete underwriting guides.

Prior Insurance Required if there was a need. Prior insurance is not required for previous renters or first time homeowners. If a customer owned a dwelling or a condominium prior to applying for coverage with the Company, we consider the individual to have had a need for prior insurance.

Dwellings Under COC Ineligible for new business; for existing customers, contact Underwriting. Major Renovations Contact Underwriting. Personal Umbrella Personal Umbrella coverage may only be written as part of a Package policy.

Please refer to complete underwriting guidelines for any other underwriting issues.


SECTION: UNIVERSAL SECURITY POLICY PORTFOLIO: UNDERWRITING - GUIDELINES

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January 15, 2005 1-California

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TABLE OF CONTENTS I. GENERAL SECTION Applications ........................................................................................................................ E Binding Authority ................................................................................................................. H General Requirements ....................................................................................................... C Insurance Interest ............................................................................................................... D Introduction ......................................................................................................................... A Limits of Liability .................................................................................................................. F New Segments .................................................................................................................... I Package Definition ............................................................................................................. B Severe Weather Binding Authority ...................................................................................... G Trailing Documents. ............................................................................................................ J

II. PRIVATE PASSENGER AUTO Driving Experience/Activity Requirements (For New Business Only).................................. F Personal Umbrella............................................................................................................... E New Business...................................................................................................................... A Renewal Business............................................................................................................... B Restricted Vehicles.............................................................................................................. F Replacement Cost Guarantee............................................................................................. D Vehicle Use ......................................................................................................................... C

III. OTHER VEHICLES Criteria for the Motorcycle List............................................................................................. C Eligibility . ............................................................................................................................ A Ineligible Motorcycle List ..................................................................................................... D Motorcycles/Mopeds Guidelines ........................................................................................ B Motor Homes ...................................................................................................................... B Recreational Vehicles ......................................................................................................... B IV. HOME Alarm Requirements ........................................................................................................... C Personal Umbrella Section.................................................................................................. G HomeWork .......................................................................................................................... H Homes Under Major Construction or Renovation................................................................ I Ineligible Exposures ........................................................................................................... E Insurance To Value ............................................................................................................ B Location .............................................................................................................................. C Loss Activity . ...................................................................................................................... C & D New Business ..................................................................................................................... C Number of Families ............................................................................................................ C & D Occupancy . ........................................................................................................................ A Protection Class . ................................................................................................................ C Renewals ............................................................................................................................ D Risk Mitigation Documentation............................................................................................ J Scheduled Personal Property ............................................................................................. F Seasonal Residence .......................................................................................................... C & D Secondary Residence ........................................................................................................ C & D Tenants Guidelines ............................................................................................................. C Values ................................................................................................................................ C Wood/Coal Stoves .............................................................................................................. C & K


SECTION: UNIVERSAL SECURITY POLICY PORTFOLIO: UNDERWRITING - GUIDELINES

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V. DWELLING FIRE SECTION

Alarm Requirements ........................................................................................................... E Eligibility . ............................................................................................................................ A Homes Under Major Construction or Renovation................................................................ I Ineligible Exposures ........................................................................................................... G Insurance To Value ............................................................................................................ C Location .............................................................................................................................. D Loss Activity ....................................................................................................................... D Loss Settlement Options . ................................................................................................... B New Business ..................................................................................................................... E Number of Families ............................................................................................................ E Protection Class . ................................................................................................................ E Renewals ............................................................................................................................ F Rental (Non-Owner Occupied) ............................................................................................ E Risk Mitigation Documentation............................................................................................ J Scheduled Personal Property ............................................................................................. H Seasonal Residence .......................................................................................................... E, & F Secondary Residence ........................................................................................................ E, & F Values ................................................................................................................................ E Wood/Coal Stoves .............................................................................................................. E & K

VI. BOAT

Corporately Owned Boats .................................................................................................. C Craft Characteristics ........................................................................................................... E Eligibility Section ................................................................................................................ A Extended Navigation . ......................................................................................................... K Ineligible Exposures . .......................................................................................................... G Ineligible Operators ............................................................................................................ I Ineligible Uses .................................................................................................................... H Ineligible Watercraft ............................................................................................................ F Liability Coverage................................................................................................................ B Marine Surveys . ................................................................................................................. E Navigational Limits . ............................................................................................................ J Value of Hull ....................................................................................................................... D

VII. PERSONAL UMBRELLA

Covered Exposures ............................................................................................................ B Eligibility . ............................................................................................................................ A Ineligible Exposures ........................................................................................................... E Underlying Limits ................................................................................................................ C Underwriting Rules .............................................................................................................. D


SECTION I: UNIVERSAL SECURITY POLICY PORTFOLIO: UNDERWRITING - GENERAL

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GENERAL A. INTRODUCTION

The Universal Security Policy (USP) Portfolio is a group of products that is anchored by our USP package policy. USP Portfolio allows for the building of a policy based on the exposure segments. Within the Company’s Portfolio, there is one type of new business we desire to write:

• USP Package

USP package contains both an eligible motor vehicle and a home segment.

The guidelines, like all such guidelines, are incapable of being exhaustive, comprehensive or responsive to every individual situation or their possible combinations. They are designed to give you an indication of the level of quality business expected by segment.

B. DEFINITION OF USP POLICIES RECEIVING PACKAGE RATE A USP policy receives the package rate when the policy contains an eligible motor vehicle and home.

• Motor vehicle = private passenger vehicle, pickup, or van, with primary liability

and

• Home = primary dwelling, condo or rental to insured (renters) with primary liability and property coverage written on the Home Segment.

• Other segments can be added as well

C. GENERAL REQUIREMENTS • In California the insureds must be allowed to purchase separate auto and property policies as described in the

individual line of business sections. The individual line of insurance rating allows for multi policy factors offering reduced rates which equates to the USP Package described below:

• Each USP package policy by the first anniversary must consist of primary coverage on at least one owned, leased, or corporately owned or furnished private passenger automobile, and an owned or leased primary premises.



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D. INSURANCE INTEREST • Policies must be in the name of an individual or individual and spouse.

• The named insured(s) must be the registered owner(s) of all vehicles to be insured on the policy.

• We must insure all 4-wheel private passenger autos, pick-ups or vans owned by the named insured(s) "other than antique vehicles".

• All property must be owned or leased by the Named Insured or jointly with another resident of the household.

• All motor vehicles must be licensed in the U.S.A. and all properties must be located in the U.S.A., whether covered for liability or physical damage.

Our contracts, pricing and underwriting are not designed to provide coverage for Corporation, LLC-Limited Liability Corporations, LLP-Limited Liability Partnership, Partnerships or Public Entities. As such they are not to be listed as Named Insured, Additional Insured or Additional Interest with the following exception:

• LLC – Limited Liability Corporations and Limited Liability Partnerships (LLP) May be added as an Additional Interest provided the LLC is solely owned by no one other than our insureds, or our insureds and their relatives, whether or not those relatives are members of the insured’s household.

• Corporations may be added as an Additional Interest provided they are chartered as a Trust, their by-laws specify that they exist as a family trust, and they have no commercial activities. The trustee and the occupant of the property must be the same individual(s). For automobiles, the trustee and the operator of the vehicles must be the same individual(s). Spouse and resident children may also operate the vehicles.

• Life Estate, Life Tenancy, Life Interest, Joint Tenancy with Right of Survivorship, Inc., are all legal terms that are used to define the disposition of property at the time of an individual’s death. The policy should be written in the name of the individual with the legal entity as an Additional Interest.

• Trusts are not to be listed as Named Insured, but can be added as an Additional Interest if the donor, the trustee and the occupant of the home are the same individual.

“Estate of” is another legal term and should not be listed as the Named Insured. Policy provisions provide the appropriate coverage to the Estate automatically when the insured passes during the policy term. There will be occasions when the policy renews soon after the insured passes and we are asked to continue coverage until the estate is settled. Each case must be individually evaluated and under the right circumstances, we can renew the policy in the deceased individual’s name and list the “Estate of” as the Additional Interest. Factors to be considered are how long the property will likely be vacant, the oversight and management of the property, how long we have provided coverage, our experience on the risk and the agent’s control of the account.

E. APPLICATIONS New business must be submitted on an ACORD application with the appropriate state supplement if required. The application must be fully completed, signed by the Named Insured and the agent and received by the company no more than 15 days after being signed by the applicant. Unsigned applications or applications with information "whited out" will be returned.

Policy effective dates prior to the date the application is signed and bound by the producer is not acceptable.



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F. LIMITS OF LIABILITY • All underlying exposures covered by the USP Portfolio policy, for which Personal Umbrella is desired,

must have personal liability limits of $100/300/100 or $300,000 CSL.

• Uninsured/Underinsured has a maximum limit of $250,000/$500,000. (Cannot be higher than the Personal Liability limit chosen). Lower limits are available.

G. SEVERE WEATHER BINDING AUTHORITY No new coverages or increase to existing coverages may be bound on any risk or exposure located in an area for which a hurricane, tornado or other severe weather watch or warning has been posted. Authority to bind is reinstated after the storm and threat of damage has passed.

The following applies to CA Earthquake binding:

• Following an event of sufficient magnitude that substantial damage may result, the CEA may declare a moratorium on the sale of new policies for up to 360 hours following the event. A moratorium is not automatic for any event.

• If a moratorium is declared, it will be communicated to the carriers and agents as soon as the Governing Board has approved it. If the CEA does not announce a moratorium, there is none in place.

• During a moratorium, no new business policies may be bound or written. Supplemental coverages may not be added for the first time and coverage limits may not be increased.

• The moratorium will not apply to policies that were bound before the moratorium is declared and it will not apply to routine renewals.



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H. BINDING AUTHORITY Please consult your Underwriter to obtain authorization to bind coverage for any exposures exceeding the following limits.

Type of Exposure/Coverage Limits of Liability

Primary Residence (PC 1-8) Coverage A $1,000,000

Liability (includes Underlying and Personal Umbrella Coverage $1,500,000

Secondary/Seasonal Residence $300,000

Primary, Secondary/Seasonal Condo/Coop/Renters $300,000

Dwelling Fire (Non-Owner Occupied Dwellings) $500,000

Dwelling Fire (Non-Owner Occupied Condo Contents) $50,000

Motor Homes (Base Sticker Price) $200,000

Boats $125,000

Automobile Physical Damage $150,000

Aggregate Scheduled or Blanket Personal Property $150,000

Jewelry Aggregate $100,000 Single Item $50,000

Fine Arts Aggregate $100,000 Single Item $50,000

Fur Aggregate $100,000 Single Item $50,000

Silverware Aggregate $100,000 Single Item $50,000

Camera Aggregate $25,000

Stamps Aggregate $25,000

Coins/Collectibles/Trading Cards Aggregate $25,000

Musical Instruments Aggregate $25,000

Golf Equipment Aggregate $25,000

Note: Ineligible Exposures as listed in the underwriting guidelines may not be bound.

I. ADDITION OF NEW SEGMENTS New segments added to existing accounts are underwritten as new exposures, subject to underwriting standards and requirements as outlined in the applicable underwriting section.



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J. DOCUMENTATION (TRAILING DOCUMENTS) Agents are required to retain the original of specific legal and administrative documents on behalf of the company and are contractually required to provide the company with copies when requested. These documents may be required for Market Conduct Exams, Insurance Department inquiries, claims coverage questions and rate justification. New business and endorsement transactions will be subject to random company audits. InterLink will select specific polices and identify for the agent, those documents that must be faxed to Encompass for audit purposes.

Failure to send the required documents to Encompass may result in loss of discounts/coverage and coverage increases. Additionally, it remains the agent’s responsibility to maintain copies of all required trailing documents, whether or not selected for audit.

Auto Documentation Required Retain in Agency File

Forward to Encompass

Signed Application

Applications must be fully completed, signed and dated by the Named Insured and Agent

"

Mandatory Uninsured Motorists Bodily Injury Coverage Offer

- UM/UIM limit is lower than the BI limit or the coverage is rejected

Supplement must be fully completed, signed, and dated by the Named Insured and Agent.

"

Auto Body Repair Consumer Bill of Rights Signed and dated by named insured. "

Good Student Discount

- Required when discount is requested.

Consists of either a certified statement from a school official indicating the student has met one of the following requirements: (1) Upper 20% of Class (2) “B” Average or its equivalent (3) If school maintains numeric grade system, must at least 3 in 4 pt system (4) Student is on “Dean’s List” or “Honor Roll” or comparable list.

-Use of ACORD 91 completed and signed by authorized official is acceptable.

"

Mature Driver Improvement Course Discount

- Required when discount is requested

Principal operator is age 55 or older and has a completion certificate, dated within the most recent 36 months.

"



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Auto Documentation Required Retain in Agency File


Anti-Theft Device

Required only when VIN does not return credit, and credit is entered manually.

Copy of installation sheet/bill, car sticker, or other documentation of installation. Should indicate type of device.

"

Loan/Lease Coverage

- Required if vehicle is older then current model year and coverage is requested.

Copy of prior carrier declarations page displaying Loan/Lease coverage was previously provided.

"

- Stated Value Coverage Copy of certified appraisal and photo. "

Named Driver Exclusion (refer to Risk Management Center on webpage)

Signed exclusion must be mailed to company, refer to RMC web page.

#

CA Auto Accident Investigation Form

- When auto accident is identified and chargeable

Must be fully completed, signed and dated by applicant. "

PROPERTY Documentation Required Retain in Agency File


Signed Application

Application must be fully completed, signed and dated by the Named Insured and agent.

"

Central Station Burglar &/or Fire Alarm Protective Device Credit or Sprinkler System Credit

Documents confirming the existence of the protective

device. "

California Residential Property Insurance Disclosure

Application must be fully completed, signed and dated by the insured.

"

Personal Inland Marine Application


"

California Scheduled Personal Property Loss Computation Disclosure

Application must be fully completed, signed and dated by the insured.

"

Scheduled Personal Property Appraisals (jewelry items valued at $25,000 and greater)

Current appraisal within 1 year for scheduled item from a certified appraisal.

"



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PROPERTY Documentation Required Retain in Agency File


Scheduled Personal Property Appraisals (items valued at $50,000 and greater)

Current appraisal within 1 year for scheduled item from a certified appraisal.

#

California Earthquake Authority


"

CA Offer of Earthquake Coverage

Fully completed, signed, and dated when property coverage purchased and CEA is not purchased.

"

Property Loss Remediation Documentation

When loss is to be excluded, refer to section J in guidelines for detailed documentation required.

"

DWELLING FIRE Documentation Required Retain in Agency File


Signed Application


"

BOAT Documentation Required Retain in Agency File


Signed Application


"

PERSONAL UMBRELLA Documentation Required Retain in Agency File


Signed Application Application must be fully completed, signed and dated by the Named Insured and agent.

"



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GENERAL Documentation Required Retain in Agency File


FCRA Notice (Information Release Form) Document must be signed and dated. "

Documentation for customer initiated cancellations

Signed LPR, insured’s copy of current policy declaration. "

Easy Pay

Complete authorization form and provide a voided check or savings account deposit slip.

"

Information Reconciliation

Auto or Home Proof of Incident Change

Documentation to substantiate incident being excluded. Proof includes: police report, court judgment, letter from carrier @ time of loss, letter from reporting agency.

"

Information Reconciliation

Driver not added to policy

Proof of insurance for operator that is defined as “listed”.

"

- Additional Insured Coverage requested Copy of business license "

When the above credits/coverages are requested the applicable trailing documents should be retained in the agency file and are subject to Company audit.


SECTION II: UNIVERSAL SECURITY POLICY PORTFOLIO: UNDERWRITING - PRIVATE PASSENGER AUTO

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PRIVATE PASSENGER AUTO A. NEW BUSINESS

The Company recognizes its responsibility to write automobile coverage for all good drivers, as defined by California Law. The Company will write an automobile policy for good drivers who submit fully completed applications.

The Company is generally not a market for non-good drivers, however we will accept operators licensed less than three years provided they have no accidents or convictions, are written with a Good Driver (e.g., a family account) and no restricted vehicle are in the household. (Refer to Rule F, in this section)

B. RENEWALS The Company will continue coverage and renew both good and non-good drivers in accordance with the requirements of the Department’s Regulation Title 10, Chapter 5, Subchapter 4.7, Article 7, Section 2632.19 - Substantial Increase in Hazard Insured Against.

The Company is not a market for drivers that fall under the definitions and limitations of this regulation.

Note: The driving records of drivers excluded from coverage by the insured may not be considered in determining eligibility for a good driver policy. An offer to exclude drivers - other than named insureds - with poor driving records must be made to both new and inforce policies.

C. VEHICLE USE The following vehicles are considered ineligible for coverage:

a. Vehicles modified to enhance performance.

b. Vehicles built from a kit.

c. Vehicles used for racing, stunt, speed, demolition and delivery activity.

D. REPLACEMENT COST GUARANTEE The following types of vehicle are ineligible for this coverage:

a. Any vehicle used off road.

b. Motor homes, motorcycles, or recreational vehicles.

c. Leased private passenger automobiles.

d. Any vehicle on the restricted vehicle list and/or valued in excess of $150,000.

e. This coverage may be purchased on new previously unregistered automobiles; the model year of the vehicle cannot be more than 4 years older than current model year.

E. PERSONAL UMBRELLA a. Coverage is available as an endorsement to a package policy with a private passenger type auto and a

primary home.

b. Personal Umbrella coverage is not available on policies that insure a driver who does not meet the California Good Driver requirements due to driving activity.

c. See Section VII for additional Personal Umbrella Underwriting guidelines.


SECTION II: UNIVERSAL SECURITY POLICY PORTFOLIO: UNDERWRITING - PRIVATE PASSENGER AUTO

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F. DRIVING EXPERIENCE/ACTIVITY REQUIREMENTS (FOR NEW BUSINESS NON-GOOD DRIVERS ONLY) • Named insured must be licensed 5 years or more.

• Activity (Drivers licensed less than 3 years): No accidents, minor violation or major violations.

• Restricted Vehicles (Refer to addendum A1) acceptable only when operated by a driver who qualifies as a Good Driver under California law.

ADDENDUM A1

RESTRICTED VEHICLES LISTACURA NSX DELOREAN JENSEN INTERCEPTOR PANTERA

AMC/JEEP: CJ5, CJ7 WRANGLER DODGE: STEALTH, VIPER LAMBORGHINI PLYMOUTH LASER RS TURBO

ASTON MARTIN EAGLE TALON TSI LANCIA SCORPION PONTIAC: FIREBIRD 8 CYL., TRANS AM, FORUMLA

AVANTI EXCALIBUR LOTUS PORSCHE: ALL MODELS

BENTLEY FERRARI MASERATI ROLLS ROYCE

BRICKLIN FORD: MUSTANG SVO, GT, 5.0 LTR., COBRA, 8 CYL.

MASDA RX7 SUZUKI: SAMAURAI, SIDEKICK, VITARA,

BUICK: GNX, GRAN NATIONAL GEO TRACKER MITSUBISHI: 3000GT, ECLIPSE GSX TURBO

TOYOTA: SUPRA TURBO, MR-2 SUPERCHARGED

CHEVROLET: CAMARO Z28, IROC Z, CAMARO 8CYL., CORVETTE

GMC: SYCLONE, TYPHOON MORGAN TVR

COBRA KIA SPORTAGE (2 DR.) NISSAN 300ZX TURBO ZIMMER

VEHICLES MODIFIED TO ENHANCE PERFORMANCE OR WITH AN ALTERED SUSPENSION (RAISED OR LOWERED FROM FACTORY DESIGN).


SECTION III: UNIVERSAL SECURITY POLICY PORTFOLIO: UNDERWRITING – OTHER VEHICLES

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OTHER VEHICLE A. ELIGIBILITY

The following miscellaneous vehicle types: all-terrain vehicles, dune buggies, trailers, and recreation trailers must be written with a qualifying private passenger type vehicle. Golf carts and snowmobiles must be submitted with a qualifying private passenger type vehicle or primary home.

B. OTHER VEHICLE TYPES MOTORCYCLES/ RECREATIONAL MOPEDS MOTOR HOMES VEHICLES

1. Refer if: a. Any operator with <3 years' motorcycle experience on public roads

a. Base sticker price over $200,000

a. Value over $10,000

b. ATV

2. Ineligible if: a. Modified for performance or appearance

b. Customized

c. Turbocharged

d. Over 500 cc. and operator has <5 years' experience with motorcycles

e. Operated by a person who has had an incident in the last 3 years while operating a motorcycle

f. Kit or homemade

g. Used or designed for stunt, racing or speed activity

h. Operated by anyone licensed less than 3 years

i. On Ineligible Motorcycle list

j. The motorcycle has characteristics identified as problematic in the “Criteria for the Motorcycle List:” section

a. The only vehicle to be insured if there is a qualifying private passenger vehicle in household

b. Used as a residence (other than on vacation)

c. Not factory built

d. In poor mechanical condition or damaged

a. No private passenger support

b. Not factory built

c. Used in racing, stunt, speed or demolition activity

d. Designed for use in the air

e. Driven by a person under 16



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C. CRITERIA FOR THE MOTORCYCLE LIST We have provided a list of specific models to help you identify in advance those motorcycles, which will not be accepted. But because of the broad range of models and variations available, and the frequent name and number changes for these vehicles by the manufacturers, the list cannot be all-inclusive.

Models are selected for the list taking into consideration the variables described below. A motorcycle model that is not specifically listed, but has any of the problematic characteristics outlined in the following is ineligible.

Motorcycles may be classified in one of these four design types:

Category Description

Racing Design Designed for street and racetrack use. Modeled after motorcycles used exclusively for racing. Quick acceleration and high performance handling. Usually aerodynamically styled with sport fairing, and tucked-in short-drop handlebars. Design gives a flashy and polished look. Descriptions by manufacturer or distributor sometimes mention "high performance" (e.g.: Honda Interceptor, Kawasaki Ninja).

Street Conventional design, no luggage components, no high raised fender or knobby tires. Usually no fairing (or mini fairing) and upright handlebars. Excludes dirt bikes, mopeds, and scooters (e.g.: Honda Magna, Yamaha Maxim).

On/Off-Road Knobby tires, high raised fenders. Off-road type motorcycle with safety equipment added (such as special lights). Description often refers to these as "dual-purpose" motorcycles, or an off-road cycle that is street legal (e.g.: Honda XL Series, Yamaha XT Series).

Touring Generally large and heavy motorcycles. Usually with travel trunk and saddlebags (luggage components). High handlebars; fairing. Manufacturer's description or Kelley Blue Book listing generally refers to these motorcycles as "touring". Built with passenger in mind (e.g.: Honda Goldwing).

Touring motorcycles, and street or on-off road models that are not performance oriented are eligible.



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D. INELIGIBLE MOTORCYCLE LIST Make Model

American Ironhorse All Models Aprilia All Models Big Dog All Models Bimota All Models BMW Motorcycle K1200RS BMW Motorcycle R1100GS ABS / SE BMW Motorcycle R1100RS BMW Motorcycle R1100R/R1100R ABS / SE BMW Motorcycle R1100S/R1100S ABS Boss Hoss All Models Boy Toy All Models Buell All Models California MC Co. All Models Castle All Models Confederate All Models Ducati All Models Honda Motorcycle CBR Series All Models Honda Motorcycle Interceptor VFR Series Honda Motorcycle RC51 Honda Motorcycle Superhawk VTR Series Honda Motorcycle Other High Performance Models Illusion All Models Kawasaki Ninja GPZ Series Kawasaki Ninja ZX Series Kawasaki Ninja 250R, 500R/EX250&500 Kawasaki ZR-750-F2/L Kawasaki ZRX1100 All Models Kawasaki Other High Performance Models Kit/Homade All Models Laverda All Models Moto Guzzi All Models MZ Cup-Skorpion Cup MZ Replica-Skorpion Replica Quantum All Models Surgical Steeds All Models Suzuki Motorcycle Bandit GSF Series Suzuki Motorcycle GS500E Suzuki Motorcycle GSX Series Katana Suzuki Motorcycle GSX1300R Hayabusa Suzuki Motorcycle GSXR Series



EFFECTIVE: PAGE NO:


Denotes Change

Make Model

Suzuki Motorcycle Katana All Models Suzuki Motorcycle RF Series Suzuki Motorcycle SV650 Suzuki Motorcycle TL1000R Suzuki Motorcycle TL1000S Suzuki Motorcycle Other High Performance Models Titan All Models Triumph Motorcycle Daytona T595, 1200, 955I Triumph Motorcycle Speed Triple T509 Triumph Motorcycle Sprint Sports All Models Triumph Motorcycle Tiger 900 All Models Ultra Kustom All Models Yamaha FZR Series Yamaha Seca XJ Series Yamaha YZF Series All Models Yamaha Other High Performance Models MDLOther Motorcycle Custom Model Not Listed Other Motorcycle High Performance Model Other Motorcycle Other Street Sports Model


SECTION IV: UNIVERSAL SECURITY POLICY PORTFOLIO: UNDERWRITING - HOMEOWNERS

EFFECTIVE: PAGE NO:


Denotes Change

HOME A. OCCUPANCY

With the exception of renter’s coverage, only owner occupied risks are eligible. Property rented to or used by others should be written on a dwelling fire segment. (Refer to Section V, Dwelling Fire.) Liability only coverage for property rented to others or a seasonal/secondary home, can be extended from a homeowner segment. To extend property liability coverage to a property rented to others, we must write the primary home.

B. INSURANCE-TO-VALUE PROGRAM All new business must be written for at least 100% replacement cost. In order to help keep up with current costs, residence/dwelling, condo and renter limits are typically adjusted annually at renewal. Limits for these coverages will not be reduced without the policyholder’s consent.

Our program is based on all dwellings being properly insured to their full replacement value. Using information and factors obtained from recognized leaders in the residential appraisal field, we have developed a viable Insurance-to-Value program.

Documentation of replacement cost valuation is required on all new business. The replacement cost must be calculated using an acceptable methodology as determined by us.

If there is a difference between the replacement value indicated by our approved methodology and the insured’s estimated value the Basic Replacement Cost endorsement (G-18737) is available and limits coverage to the dwelling amount shown on the Coverage Summary.

Risks with unacceptable inspection results are ineligible.



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C. NEW BUSINESS

DWELLINGS PRIMARY

OWNER OCCUPIED 1 OR 2 FAMILY

SEASONAL/SECONDARY OWNER OCCUPIED

1 OR 2 FAMILY

CONDOMINIUM/COOPERATIVE OWNER OCCUPIED

& RENTED TO INSURED (TENANTS) 1 FAMILY

VALUE

Minimum – Zone A: $150,000* Zone B: $125,000*

(See list defined by County below) Maximum $4,000,000

Minimum $100,000 Maximum (P.C. 1-8)

$3,000,000

Primary Minimum $40,000

Seasonal/Secondary Minimum $40,000

HIGH VALUED HOMES

Homes valued in excess of $1,000,000 must be submitted prior to the effective date. Acceptability is subject to an acceptable on site inspection report.

See Primary. Not Applicable.

CONSTRUCTION

The following construction types are ineligible: - Homes built on a slope greater than 20 degrees - Dwellings with 4 or more stories - Wood roofs are ineligible if located in any county

south of Kern and San Luis Obispo counties; if located in the rest of the state, wood roofs must meet the following criteria: >Located more than 1/2 mile from brush; >Located in protection class 8 or better; and, >The roof must be no older than 20 years.

- Dwellings built on stilts or pilings.


CENTRAL STATION ALARMS

Required if any of the following conditions apply: − Replacement Cost exceeds $750,000. − Contents exceed $250,000 in any location. − Total Scheduled Personal Property exceeds

$300,000. − Located in city over 400,000 population with no

daily occupancy.

See Primary. Required if any of the following conditions apply: − Contents exceed $250,000 in any

location. − Total Scheduled Personal Property

exceeds $300,000. − Located in city over 400,000

population with no daily occupancy.

MINIMUM DEDUCTIBLE $500 $500 $500



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Denotes Change

DWELLINGS PRIMARY



1 OR 2 FAMILY



INSURANCE TO VALUE 100% ITV 100% ITV Not Applicable.

LOCATION

- Brush Ineligible if located within a brush area or within 1500* feet of brush.

*Acceptable if over 1,000 feet if the home meets the following criteria: No composition roof Stucco only exterior Minimum value $200,000 Primary residence only 0 prior losses in the last 3 years All other criteria acceptable Brush must be light and intermittent

Coastal

Must be at least: >15 feet above mean high tide; >1500 feet from ocean shore; and, -Must be located on the non-ocean side of the first inland street.

ROOF, ELECTRICAL, HEATING, & PLUMBING

Homes must be well maintained. Must have updated roof within last 20 years (unless Slate or Tile). Homes > 49 years old must have copper or PVC plumbing and electrical service must be controlled by circuit breakers with minimum 100 AMP service.

BIOLOGICAL IRRITANTS, CONTAMINANTS OR SPORES

Additional coverage available only for primary owner occupied structures under the Elite policy.

PROTECTION CLASS Protection Class 1-8 only. See Primary See Primary



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DWELLINGS PRIMARY



1 OR 2 FAMILY



ACCOUNT LOSS ACTIVITY (Last 3 years)

1 Property loss subject to the following:

-One theft loss < $500

-One theft loss at prior residence of any amount.




- Exception: Applicants with prior losses to the dwelling structure in the past 3 years (at the residence to be insured) may be written with full documentation,* prior to binding, if the hazard or any other unusual exposure has been remedied.

- This exception does not apply to theft and liability losses. New applicants with prior theft or liability losses cannot be written except for those losses previously noted above. In most cases, we will accept renewable existing customers with a theft or liability loss (no mitigation documentation is necessary).

Refer to Section J for a complete list of acceptable risk mitigation documentation.

PRIOR INSURANCE Required if there was a need. Prior insurance is not required for previous renters or first time homeowners. If a customer owned a dwelling or a condominium prior to applying for coverage with the Company, we consider the individual to have had a need for prior insurance

WOODSTOVE Eligible for owner occupied dwelling. Ineligible as primary heat source or if self installed. Completion of our Woodstove Questionnaire (Form G57872) required.

(FOR ADDITIONAL INELIGIBLE EXPOSURES, SEE PART F.)



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Denotes Change

ZONE A: METROPOLITAN AREA DEFINED AS THE FOLLOWING COUNTIES:

SOUTHERN CALIFORNIA

San Diego

Orange

Riverside

San Bernardino

Los Angeles

Ventura

NORTHERN CALIFORNIA

Sacramento

Placer

El Dorado

San Francisco

San Mateo

Alameda

Contra Costa

Santa Clara

Santa Cruz

Monterey

Marin

Sonoma

Napa

ZONE B: REMAINING COUNTIES



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D. RENEWAL BUSINESS THE FOLLOWING REPLACES THE CORRESPONDING NEW BUSINESS GUIDELINE

CATEGORIES WHEN REVIEWING AN ACCOUNT FOR RENEWAL

DWELLINGS PRIMARY



1 OR 2 FAMILY



CONSTRUCTION

The following construction types are ineligible: - Homes built on a slope greater than 20

degrees - Dwellings with 4 or more stories - Wood roofs must meet the following criteria:

>Located more than 1/2 mile from brush; >Located in protection class 8 or better; and, >The roof must be no older than 20 years.



INSURANCE TO VALUE 100% ITV 100% ITV Not Applicable.

ROOF, ELECTRICAL, HEATING, & PLUMBING Well-maintained and updated.

LOSS ACTIVITY (Last 3 years) No adverse loss history that has not been remedied.

BIOLOGICAL IRRITANTS, CONTAMINANTS OR

SPORES

Additional coverage available only for primary owner occupied structures under the Elite policy.

(FOR ADDITIONAL INELIGIBLE EXPOSURES, SEE PART F.)



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Denotes Change

E. INELIGIBLE EXPOSURES 1. Reserved for future use.

2. Dwelling History

a. Converted to dwelling purposes from another use.

b. Converted to increase the number of families.

c. Relocated dwellings.

d. Homes must be well maintained. Must have updated roof within last 20 years (unless Slate or Tile). Homes over 49 years old must have copper or PVC plumbing and electrical service must be controlled by circuit breakers with minimum 100 AMP service.

3. Inappropriate Hazards

a. Dwellings in poor condition, with unrepaired damage or below average maintenance.

b. Premises with exotic pets or animals in the household with a bite history.

c. Swimming pools not in compliance with local codes or ordinance. Unfenced swimming pools are ineligible.

d. True farming exposures, where a substantial portion of income derived from farming activities.

e. With market value (excluding land) of under 70% of current replacement cost.

f. With supplemental heating by coal or kerosene stoves or multiple space heaters.

g. Trampolines

4. Location

a. If exposed to flood, wavewash, sinkhole, pollution, landslide or cave-in area, within 1,500 feet of the ocean or less than 15 feet above mean high tide.

b. Within 100 feet of a commercial or industrial property.

c. In a brush area or within 1,500 feet of brush. (Within 1,000 ft. Refer to Section IV, Rule C).

5. Unacceptable Construction

a. Construction done by owner, unless a professional licensed contractor (includes wiring, heating, and plumbing).

b. Dwellings of obsolete, unique, or irreplaceable construction.

c. Dwellings under course of construction or major renovation (resulting in 25% or more increase in home value).

d. Dwellings without central heating, unless in warm climate or seasonal dwelling.

e. Unapproved roofs including roll tar paper, tin, and aluminum.

f. Without modern and adequate electrical service, plumbing, or heating system.



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Denotes Change

6. Unqualified Structures

a. Basement homes.

b. Boat houses as primary residences.

c. Mobile/Manufactured homes. d. Dwellings with 4 or more stories.

e. Open foundations. f. Where any part of structure rests on piers or pilings.

7. Use of Dwelling

a. Business conducted on premises must meet requirements and restrictions for the applicable endorsement: Office Professional, Private School or Studio; Permitted Incidental Business Occupancy; Business Pursuits; Home Day Care.

b. Number of families exceed number of units. c. Units rented or leased to others during any part of the year.

d. With any roomers or boarders.

e. Unoccupied or vacant buildings.

f. Dwelling Replacement Cost exceeds $750,000 (Coverage A) with no Central Fire and Burglar alarm.

F. SCHEDULED PERSONAL PROPERTY The following applies to all new and existing business:

1. Any class, including blanket coverage and scheduled coverage, exceeding the following limits must be submitted non-bound.

Class Aggregate

Jewelry $100,000 Fine Arts 100,000 Furs 25,000 Silverware 25,000 Cameras 25,000 Stamps 25,000 Coins/Collectibles/Trading Cards 25,000 Musical Instruments 25,000 Golfer's Equipment 25,000 Other 0

2. For scheduled classes, any single item exceeding $50,000 must be submitted non-bound.

3. Any schedule exceeding $150,000 in total value, blanket and scheduled, must be submitted non-bound.

4. Schedules for the following should be submitted non-bound.

a. Known collectors, dealers and exhibitors. b. Persons who travel excessively. c. Persons in the "Public Eye" i.e., celebrities, professional athletes. e. Items located in dwellings other than primary residences.

f. Fine Arts that are loaned or exhibited.



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Denotes Change

5. Appraisal Requirements

Certified appraisals are required for all single jewelry items valued at $25,000 or more. Appraisals are required for all other single items valued at $50,000 or more. All appraisals are to be retained by the agent.

G. PERSONAL UMBRELLA 1. Personal Umbrella is available for package policies only.

2. See Section VII for Personal Umbrella Underwriting Guidelines.

H. HOMEWORK ENDORSEMENT The home-based business must meet the following criteria to be eligible for the HomeWork Supplement:

• The business type must fall within one of the eligible classes specified in the attached list.*

• The business must be an individual proprietorship, or a husband/wife partnership.**

• Businesses with employees, other than family members of the insured's household, are not eligible.

• Maximum allowable sales/receipts is $300,000. (Note: Businesses with higher sales/receipts can be considered on a refer-to-company basis.)

• Use of subcontractors cannot exceed 10% of sales/receipts.

• The business must be operated out of the insured's primary residence, which is primarily used for dwelling purposes.* The definition of residence premises includes the primary residence, grounds and other structure. Therefore, if the business is conducted on the grounds of the primary residence, even if it is in a detached structure, coverage can be written.

• Any prior losses must be fully documented.

• The HomeWork Supplement Application must be completed in full and submitted along with request.

*Note: By contractual definitions, HomeWork benefits apply only to the eligible classes and the primary residence (for on premises property coverage).

**Note: Additional Insureds such as an off premises Lessor (owner of a shopping mall, etc.), Vendors (for example, a computer company), a Lessor of Leased Equipment, etc., can be added via the HomeWork Additional Insured Amendment. The Additional Insured Amendment is generally intended to be used when a third party has an insurable interest in property covered by the HomeWork Amendment or requires a Certificate of Insurance.



EFFECTIVE: PAGE NO:


Denotes Change

HomeWork Supplement Eligible Businesses Professional Services Accountants/Auditors Adjusters Appraisers Architects Computer Programmers Dentists Economists Engineers Financial Advisors/Planners Lawyers Management Consultants Market Research Psychologists Training Educational/Instructional Services Art/Music/Instructors Educational/Vocational Counselors Tutors Artists Designers Painters Sculptors Sales Home Decorating products—Sales Household Products Insurance Sales Real Estate Sales Securities and Financial Services Telemarketing/Direct Mail Services Travel Agents/Travel Planners Administrative Support Services Bookkeepers, Accounting, Auditing Clerks Data-Entry Clerks Editors/Proofreaders Resume Services Secretaries/Stenographers/Typists Telephone Answering Services Translators Personal Services Dressmaking/Tailoring Interior Designers Shopping Services Repair Services Cameras Clocks Musical Instruments Watches Craftsmakers Ceramics/Pottery Clothes Engraving Leather Goods Quilts Stained-Glass Products



EFFECTIVE: PAGE NO:


Denotes Change

I. HOMES UNDER MAJOR CONSTRUCTION OR RENOVATION For homes under major renovation (25% or more increase in home value) or under course of construction, the following must be considered prior to referring to the underwriter:

1. Current home should be within 50 miles to ensure oversight on the part of the insured.

2. Homes should be written at completed value. Maximum completed value for a course of construction exposure is $1,000,000.

3. Minimum deductible $1,000.

4. Insured cannot be acting as general contractor.

5. A certificate of insurance should be provided by the general contractor reflecting limits of at least 1.5 times the completed value, or $500,000, whichever is greater, including general liability and workers compensation insurance.

6. Home must be located in protection class 1 through 8.

7. Homes should generally be completed and occupied within 180 days. Higher value homes should be completed within one year. For homes where the anticipated completion date is greater than 6 months, an interim drive-by inspection will be ordered at the anticipated halfway point.

8. For homes over $750,000, once enclosed, a centrally monitored fire and burglar alarm is required.

9. Coverage will only be provided on a USP Portfolio Dwelling Fire segment policy with the Real Property Basic Replacement Cost Coverage loss settlement option.

10. No new home or alarming credits until construction is completed.



EFFECTIVE: PAGE NO:


Denotes Change

J. RISK MITIGATION DOCUMENTATION Applicants with prior loss history in the past 3 years must provide documentation prior to binding that the hazard or any other unusual exposure that caused the loss has been remedied.

Required documentation may include, but not limited to:

1. Home Inspections – performed by a licensed home inspector in the past 60 days. Must include:

a. Be on company stationary/letterhead

b. Contractor’s license number

c. Identify the applicant/customer by name

d. Thorough description of the overall condition of the property including electrical, plumbing, structure

e. Confirm the absence of an existing hazard

2. Contractor Receipts, Invoices, Work Orders, and Contracts – receipts, invoices, and contracts must total at least 80% of the claim payout and must contain the following:

a. Contractor license number

b. Contractor phone number

c. Business address

d. Thorough description of the work performed

e. Date the work was completed

f. Amount paid to the contractor

g. Insured’s signature on the contract

3. Letters of Experience – must provide specific information related to the loss(es) which occurred in the past 3 years and give indication that the hazard no longer presents a substantial relationship to future loss. The letter must include:

a. Must be on the Company letterhead

b. Must include the claim representative name and phone number (or other company contact)

c. Must include thorough details of the loss including: where the loss occurred, what caused the damage, and what was damaged

d. Must include amounts paid under each coverage and if repairs were made.



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Denotes Change

K. WOODSTOVE REQUIREMENTS 1. Home must be owner occupied and not a seasonal/secondary.

2. UL approved.

3. Wood stove, pipe and chimney cleaned and inspected annually

4. Installed by a professional contractor or dealer

5. Used only as supplemental or occasional heat

6. Chimney extend at least 3 ft above the highest point where it passes through the roof and is it at least 2 ft higher than any portion of the dwelling that is within a 10 ft radius

7. Chimney must have a flue liner

8. Chimney free of any defects (missing bricks, broken mortar, cracks, etc

9. A minimum of 36 inches between the stove and any combustibles (drapes, furniture, carpets, wood, etc

10. Only one stove connected to the same chimney

11. Heat shields on the wall

12. A minimum of 36 inches between the stove and the wall

13. On an approved mat that is at least 4 inches thick

14. Mat extend out at least 18 inches from the front and sides of the stove

15. Stovepipe may not pass through any concealed area (attic, closet, etc)., or any floor-ceiling assemblies

16. Stovepipe may not pass through an exterior wall or window without connecting to a chimney leaving the pipe exposed

17. Stovepipe may not have more than two right angle turns between the stove and chimney

18. Stovepipe passing through a wall must be protected by an approved thimble

19. Stovepipe passing through a wall that must be at least 18 inches from the ceiling

20. Stove legs may not be elevated on blocks of wood


SECTION V: UNIVERSAL SECURITY POLICY PORTFOLIO: UNDERWRITING – DWELLING FIRE

EFFECTIVE: PAGE NO:


Denotes Change

DWELLING FIRE A. ELIGIBILITY

The Dwelling Fire segment has one coverage option. Coverage is provided for both liability and the dwelling.

The following residence types are eligible for the Dwelling Fire segment.

1. Dwellings owned by the insured and rented to others.

2. Condominiums and co-operatives that are owned by the insured and rented to others.

3. Dwellings owned and occupied by the insured.

Note: We will accept up to four (4) rental units for an insured.

B. LOSS SETTLEMENT OPTIONS USP Portfolio has two loss settlement options. Policies desiring Broadened Replacement Cost must be insured at 100% of replacement value. Insured's can elect the actual cash value option which, revises loss settlement on the dwelling to an actual cash value basis.

C. INSURANCE-TO-VALUE PROGRAM Our program is based on all dwellings being properly insured to their full replacement cost. Using information and factors obtained from recognized leaders in the residential appraisal field, we have developed a viable Insurance-to-Value program. In order to keep up with current costs, residence/dwelling and condo limits are typically adjusted annually at renewal. Limits for these coverages will not be reduced without the policyholder’s consent.

Documentation of replacement cost valuations is required on all new business. The replacement cost must be calculated using an acceptable methodology as determined by us.

If the Actual Cash Value loss settlement option is desired, calculate the replacement cost. Determine depreciated value, based on age and condition utilizing industry depreciation tables. Unlike the replacement cost option, policies with the actual cash value loss settlement option will not be increased for insurance-to-value each renewal.

Risks with unacceptable inspection results are ineligible.

D. RESERVED FOR FUTURE USE



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Denotes Change

E. NEW BUSINESS

DWELLINGS RENTAL

NON-OWNER OCCUPIED 1 TO 4 FAMILY

PRIMARY OWNER OCCUPIED

1 TO 4 FAMILY


1 TO 4 FAMILY

VALUE

Minimum $125,000 Minimum $125,000 Maximum (P.C. 1-8) $3,000,000

Minimum $100,000 Maximum (P.C. 1-8) $3,000,000

HIGH VALUED HOMES Dwellings valued in excess of $1,000,000 must be submitted prior to the effective date. Acceptability is subject to an acceptable on site inspection report.

CONSTRUCTION

The following construction types are ineligible: - Homes built on a slope greater than 20 degrees - Dwellings with 4 or more stories - Wood roofs are ineligible if located in any county south of Kern and San Luis Obispo counties; if located in the rest of the state, wood

roofs must meet the following criteria: >Located more than 1/2 mile from brush; >Located in protection class 8 or better; and, >The roof must be no older than 20 years.


CENTRAL STATION ALARMS

Required if any of the following conditions apply: − Replacement Cost exceeds $750,000 if Owner or Non-Owner occupied. − Contents exceed $250,000 in any location. Total Scheduled Personal Property exceeds $300,000.

MINIMUM DEDUCTIBLE $500

INSURANCE TO VALUE 100%



EFFECTIVE:PAGE NO:


Denotes Change

DWELLINGS RENTAL



1 TO 4 FAMILY


1 TO 4 FAMILY

LOCATION

- Brush Ineligible if located within a brush area or within 1500 feet of brush.

*Acceptable if over 1,000 feet if the home meets the following criteria: No composition roof Stucco only exterior Minimum value $200,000 Primary residence only 0 prior losses in the last 3 years All other criteria acceptable

Brush must be light and intermittent

Coastal Must be at least: >15 feet above mean high tide; >1500 feet from ocean shore; and, -Must be located on the non-ocean side of the first inland street.

ROOF, ELECTRICAL, HEATING, & PLUMBING Home must be well-maintained. Must have updates roof within last 20 years (unless Slate or Tile). Homes > 49 years old must have

copper or PVC plumbing and electrical service must be controlled by circuit breakers with minimum 100 AMP. BIOLOGICAL IRRITANTS,

CONTAMINANTS OR SPORES

Additional coverage unavailable for all Fire Dwelling structures.

PROTECTION CLASS No Protection Class 9-10 See Primary.



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Denotes Change

DWELLINGS RENTAL



1 TO 4 FAMILY


1 TO 4 FAMILY ACCOUNT LOSS ACTIVITY

(Last 3 years) 1 Property loss subject to the following:

-One theft loss < $500

-One theft loss at prior residence of any dollar amount.




- Exception: Applicants with prior losses to the dwelling structure in the past 3 years (at the residence to be insured) may be written with full documentation,* prior to binding, if the hazard or any other unusual exposure has been remedied.

- This exception does not apply to theft and liability losses. New applicants with prior theft or liability losses cannot be written except for those losses previously noted above. In most cases, we will accept renewable existing customers with a theft or liability loss (no mitigation documentation is necessary).

Refer to Section J for a complete list of acceptable risk mitigation documentation.

PRIOR INSURANCE Required if there was a need.

WOODSTOVE Eligible for owner occupied dwelling. Ineligible as primary heat source or if self installed. Completion of our Woodstove Questionnaire (Form G57872) required.

Note: The Company must write primary homeowners.

(FOR ADDITIONAL INELIGIBLE EXPOSURES, SEE PART G.)



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Denotes Change

F. RENEWAL BUSINESS THE FOLLOWING REPLACES THE CORRESPONDING NEW BUSINESS GUIDELINE

CATEGORIES WHEN REVIEWING AN ACCOUNT FOR RENEWAL.

DWELLINGS RENTAL



1 TO 4 FAMILY


1 TO 4 FAMILY

CONTENTS

Limited to houseware appliances and other hardware, but never household furnishings, i.e. chairs, tables etc. Condo/Cooperative rented to others $5,000 to $30,000

Not Applicable. Not Applicable.

CONSTRUCTION

The following construction types are ineligible: - Homes built on a slope greater than 20 degrees - Dwellings with 4 or more stories - Wood roofs must meet the following criteria:

>Located more than 1/2 mile from brush; >Located in protection class 8 or better; and, >The roof must be no older than 20 years.


INSURANCE TO VALUE 100%

ROOF, ELECTRICAL, HEATING, & PLUMBING Well-maintained and updated.

BIOLOGICAL IRRANTANTS, CONTAMINANTS OR

SPORES

Additional coverage unavailable for all Fire Dwelling structures.

LOSS ACTIVITY (Last 3 years) No adverse loss history that has not been remedied.

Note: The Company must write supporting homeowners.

(FOR ADDITIONAL INELIGIBLE EXPOSURES, SEE PART G.)



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Denotes Change

G. INELIGIBLE EXPOSURES 1. Dwelling History

a. Converted to dwelling purposes from another use.

b. Converted to increase the number of families.

c. Relocated dwellings.

d. Homes must be well maintained. Must have updated roof within last 20 years (unless Slate or Tile). Homes over 49 years old must have copper or PVC plumbing and electrical service must be controlled by circuit breakers with minimum 100 AMP.

2. Inappropriate Hazards

a. Dwellings in poor condition, with unrepaired damage or below average maintenance.

b. Premises with exotic pets or animals in the household with a bite history.

c. Swimming pools not in compliance with local codes or ordinance. Unfenced swimming pools are ineligible.

d. True farming exposures, where a substantial portion of income is derived from farming activities.

e. With market value (excluding land) of under 70% of current replacement cost.

f. With supplemental heating by coal or kerosene stoves or multiple space heaters.

g. Trampolines

3. Location

a. If exposed to flood, wavewash, sinkhole, pollution, landslide or cave-in area, within 1,500 feet of the ocean or less than 15 feet above mean high tide.

b. Rental dwellings located over 100 miles from primary home (not applicable if local property manager manages the location).

c. Within 100 feet of a commercial or industrial property.

d. In a brush area or within 1,500 feet of brush. (Within 1,000 ft. Refer to Section V, Rule E).

4. Unacceptable Construction

a. Construction done by owner, unless a professional licensed contractor (includes wiring, heating, and plumbing).

b. Dwellings of obsolete, unique, or irreplaceable construction.

c. Dwellings under course of construction or major renovation (25% or more increase in home value).

d. Dwellings without central heating, unless in warm climate or seasonal dwelling.

e. Unapproved roofs including roll tar paper, tin, and aluminum.

f. Without modern and adequate electrical service, plumbing, or heating system.



EFFECTIVE: PAGE NO:


Denotes Change

5. Unqualified Structures a. Basement homes. b. Boat houses as primary residences. c. Mobile/Manufactured homes.

d. Dwellings with 4 or more stories.

e. Open foundations.

f. Where any part of structure rests on piers or pilings.

6. Use of Dwelling

a. Business conducted on premises must meet requirements and restrictions for the applicable endorsement: Office Professional, Private School or Studio; Permitted Incidental Business Occupancy; Business Pursuits; Home Day Care.

b. Number of families exceed number of units.

c. Units rented or leased to others during any part of the year.

d. With any roomers or boarders.

e. Unoccupied or vacant buildings.

f. Dwelling Replacement Cost exceeds $750,000 with no Central Fire and Burglar alarm.

H. SCHEDULED PERSONAL PROPERTY (only available on owner occupied dwelling fire) The following applies to all new and existing business: 1. Any class including blanket coverage, exceeding the following limits must be submitted nonbound.

Class Aggregate

Jewelry $100,000 Fine Arts 100,000 Furs 50,000 Silverware 50,000 Cameras 25,000 Stamps 25,000 Coins/Collectibles/Trading Cards 25,000 Musical Instruments 25,000 Golfer's Equipment 25,000 Other 0

2. For scheduled classes, any single item exceeding $50,000 must be submitted nonbound.

3. Any schedule exceeding $150,000 in total value must be submitted nonbound.

4. Schedules for the following should be submitted nonbound.

a. Known collectors, dealers, exhibitors.

b. Persons who travel excessively.

c. Persons in the "Public Eye" i.e., celebrities, professional athletes.

e. Items located in dwellings other than primary residences.

f. Fine Arts that are loaned or exhibited.



EFFECTIVE: PAGE NO:


Denotes Change

5. Appraisal Requirements

Certified appraisals are required for all single jewelry items valued at $25,000 or more. Appraisals are required for all other single items valued at $50,000 or more. All appraisals are to be retained by the agent.

I. HOMES UNDER MAJOR CONSTRUCTION OR RENOVATION For homes under major renovation (25% or more increase in home value) or under course of construction, the following must be considered prior to referring to the underwriter:

1. Current dwelling should be within 50 miles to ensure oversight on the part of the insured.

2. Homes should be written at completed value. Maximum completed value for a course of construction exposure is $1,000,000.

3. Minimum deductible $1,000.

4. Insured cannot be acting as general contractor.

5. A certificate of insurance should be provided by the general contractor reflecting limits of at least 1.5 times the completed value, or $500,000, whichever is greater, including general liability and workers compensation insurance.

6. Home must be located in protection class 1 through 8.

7. Homes should generally be completed and occupied within 180 days. Higher value homes should be completed within one year. For homes where the anticipated completion date is greater than 6 months, an interim drive-by inspection will be ordered at the anticipated halfway point.

8. For homes over $750,000, once enclosed, a centrally monitored fire and burglar alarm is required.

9. Coverage will only be provided on a USP Portfolio Dwelling Fire segment policy with the Real Property Basic Replacement Cost Coverage loss settlement option.

10. No new home or alarming credits until construction is completed.



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J. RISK MITIGATION DOCUMENTATION Applicants with prior loss history in the past 3 years must provide documentation prior to binding that the hazard or any other unusual exposure that caused the loss has been remedied.

Required documentation may include, but not limited to:

1. Home Inspections – performed by a licensed home inspector in the past 60 days. Must include:

a. Be on company stationary/letterhead

b. Contractor’s license number

c. Identify the applicant/customer by name

d. Thorough description of the overall condition of the property including electrical, plumbing, structure

e. Confirm the absence of an existing hazard

2. Contractor Receipts, Invoices, Work Orders, and Contracts – receipts, invoices, and contracts must total at least 80% of the claim payout and must contain the following:

a. Contractor license number

b. Contractor phone number

c. Business address

d. Thorough description of the work performed

e. Date the work was completed

f. Amount paid to the contractor

g. Insured’s signature on the contract

3. Letters of Experience – must provide specific information related to the loss(es) which occurred in the past 3 years and give indication that the hazard no longer presents a substantial relationship to future loss. The letter must include:

a. Must be on the Company letterhead

b. Must include the claim representative name and phone number (or other company contact)

c. Must include thorough details of the loss including: where the loss occurred, what caused the damage, and what was damaged

d. Must include amounts paid under each coverage and if repairs were made

K. WOODSTOVE RULES Refer to HOME SECTION K.


SECTION VI: UNIVERSAL SECURITY POLICY PORTFOLIO: UNDERWRITING - BOAT

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BOAT A. ELIGIBILITY

All Operators must be Good Drivers as defined by California law who submit fully completed applications.

B. LIABILITY COVERAGE USP Portfolio provides liability coverage for the following boats automatically within the Home and Dwelling Fire Segments.

• Outboard motors 0 to 25 horsepower • Sailboats 0 to 25 feet • Inboard and Inboard/Outboard motors 0 to 50 horsepower

If liability and hull coverage is purchased for boats falling within the above parameters, liability can be purchased up to $500,000 to match the liability limits of the supporting segment.

The above boats, falling within this free liability band, without hull, cannot purchase liability only coverage. Liability coverage will be automatic with purchase of the supporting Home or owner occupied Dwelling Fire Segment.

C. CORPORATELY OWNED BOATS Corporately owned craft can be written if the craft is used strictly for private pleasure purposes.

D. VALUE OF BOAT/MOTORS 1. The value of the boat or any outboard motor may never be less than the average value listed in current

editions of ABOS, BUC or similar industry guides.

2. Newly purchased watercraft should be valued at its full purchase price, at a minimum.

E. CRAFT CHARACTERISTICS Watercraft not meeting the following characteristics must be referred to the underwriter, nonbound, with a marine survey (secured at applicant's expense):

- Value: <$125,000 (current book value) - Length: < 40 feet (at centerline) - Speed: < 55 mph Hull age: < 25 years if hull coverage is requested.

F. INELIGIBLE WATERCRAFT 1. Not seaworthy.

2. Non-commercially manufactured (kit or home-made boats).

3. Craft under construction.

4. Hydroplanes and any strictly one-man motorized craft.

5. Houseboats as permanent living quarters.

6. Submarines, motor driven surfboats, water cycles, or any type of experimental craft.

7. Surplus military or naval craft.

8. Jet boats, jet skis or personal watercraft, jet drives and air boats.



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9. Inflatable boats.

10. Ice boats.

11. Amphibious land/water crafts.

12. Air propelled boats, including marsh boats.

G. INELIGIBLE EXPOSURES 1. Used by any youth organization.

2. Equipped with gasoline or "white gas" fueled appliances.

3. Powered above manufacturer's or coast guard's designation.

4. Powered by converted automobile or air-cooled engines.

5. Equipped with hydrofoils or dry-stacked exhaust system.

6. Designed or modified for performance or competition.

7. Hauled by trailer not designed for use as boat trailer.

8. Home-built or kit-built trailers.

9. Used by person not having a valid driver's license.

10. Kept or stored in unsecured open lots.

11. Boats with un-repaired damage.

12. Boats used for business entertainment.

13. Boats that are chartered.

H. INELIGIBLE USES 1. Any commercial or business-related use, including renting, hiring, or chartering.

2. Racing, other than sailboats.

3. Permanent living quarters.

I. INELIGIBLE OPERATORS 1. Persons whose automobile, boat, or recreational vehicle policy has been canceled, declined, or non-

renewed for underwriting reasons in the past 3 years.

2. Persons having more than one negligent boat loss in the last 3 years.

3. Persons whose driving record would not qualify for an automobile policy with us.

4. Operators under 18 years of age unless accompanied by an eligible parental operator.

5. Persons without a valid driver's license.

J. NAVIGATIONAL LIMITS Per policy.



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K. EXTENDED NAVIGATION ENDORSEMENT The following are the minimum allowable requirements to issue the Extended Navigation Endorsement:

Boat Length: 35 Feet

Operator Experience: 4 Years of Ocean Navigational Experience

Membership: U.S. Power Squadron and Coast Guard Auxiliary

Boat Equipment: Twin Engines LORAN VHF Radio with Backup Radio Firefighting Equipment (Automatic Halon System and Fire Extinguishers) Tenders Automatic Radio Beacon


SECTION VII: UNIVERSAL SECURITY POLICY PORTFOLIO: UNDERWRITING – PERSONAL UMBRELLA

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PERSONAL UMBRELLA A. REQUIRED EXPOSURES

1. Personal Umbrella coverage is only available as part of a Package policy.

2. Personal Umbrella coverage can be extended over a home segment if the only primary auto is a corporate owned and insured vehicle.

B. COVERED EXPOSURES All exposures, except trailers, can have personal umbrella (with or without primary liability) subject to the required Exposure Rule A. above.

C. REQUIRED UNDERLYING LIMITS - Personal umbrella coverage must be present on all listed exposures (except trailers and excluded

vehicles).

- The same liability limit must be selected for all exposures.

- Underlying exposures covered by our USP Portfolio policy must carry minimum limits of $100,000/$300,000, or $300,000 Single Limit Liability for Motor Vehicles. Homeowners, boat, and dwelling fire must carry $300,000 Single Limit Liability.

D. UNDERWRITING RULES 1. All underlying exposures not insured with us, must meet the Underwriting Rules for the exposure as if we

were insuring it.

2. Personal umbrella is not available on policies that insure a driver who does not meet the California Good Driver requirements due to driving activity.

3. Carrier providing primary liability coverage for underlying exposures must be rated at least ‘B+’.


SECTION VII: UNIVERSAL SECURITY POLICY PORTFOLIO: UNDERWRITING – PERSONAL UMBRELLA

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E. INELIGIBLE EXPOSURES The following are ineligible:

1. Any exposure that cannot be covered under a personal lines policy.

2. Celebrities, professional athletes, entertainers or other high profile risks.

3. Any boat (excluding sailboats) used for racing.

4. Any boat with a rated speed over 55 MPH.

5. Any risk whose primary coverage is issued by any carrier with a Best's Policyholder's Rating of Less than "B+".

6. Any boat greater than or equal to 40 feet in length.

7. Any boat with power in excess of the manufacturer's specifications.

8. Any boat with reduced waterskiing liability limits.

9. Any owned or non-owned aircraft exposure.

10. Property or Auto only policies.

11. Any motor vehicle used for organized racing, stunt, speed or demolition activity.

12. Any true farm exposure.

13. Any professional exposure (excluding teachers).

14. Jet boats, jet skis or personal watercraft, jet drives, and air boats.