Appendix — Preis v. Lexington Insurance Insurance Co Co (No. 08-594)

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APPENDIX A

IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

Civil Action No. 06-0360-WS-C

RICHARD PREIS and VICTORIA PREIS,

Plaintiffs,

vs.

LEXINGTON INSURANCE COMPANY,

Defendant.

ORDER ON JURY TRIAL

This action came before the Court for trial by jury

on August 13, 14 and 15, 2007, with United States

District Judge William H. Steele presiding. The jury

was selected on July 31, 2007 and sworn on the

morning of trial. The Plaintiffs presented their

evidence and rested on August 13, 2007. The

Defendant filed a Motion for Judgment as a Matter of

Law at the conclusion of the Plaintiffs’ case. The

Defendant presented its evidence and rested on

August 14, 2007. The Defendant renewed its Motion

for Judgment as a Matter of Law at the close of all

the evidence which was GRANTED with respect to

loss of contents and DENIED with respect to the

house for the reasons stated on the record. The

Plaintiff filed a Motion for Judgment as a Matter of

Law at the conclusion of all the evidence which was

DENIED for the reasons stated on the record. The

Court held a charge conference with counsel and the

parties gave their closing arguments to the jury. The

Court charged the jury on the applicable law and the

jury commenced their deliberations.

On the 15th day of August, 2007, the jury who

having heard the evidence, the arguments of counsel

and having considered the same upon their oaths,

returned the verdict, a copy of which is attached

hereto, into open court with counsel present.

DONE and ORDERED this 21st day of August,

2007.

/s/William H. Steele

William H. Steele

United States District Judge

IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

CIVIL ACTION 06-0360-WS-C

RICHARD PREIS and VICTORIA HEARIN PREIS,

Plaintiffs,

Vv.

LEXINGTON INSURANCE COMPANY,

Defendant.

VERDICT FORM WITH SPECIAL

INTERROGATORIES

1. Do you find that the Plaintiffs property located at

15049 Scenic Highway 98, Point Clear, Alabama

sustained wind damage as a result of Hurricane

Katrina?

a ee

YES NO

If the answer to question #1 is “NO”, sign the form

and inform the Court.

If the answer to question #1 is “YES”, proceed to

question #2.

2. What is the actual cash value of the Plaintiffs’ loss

on the home structure attributable to:

70,000.00 whi

Wind Flood

3. Do you find that the Plaintiffs’ property was

rendered unfit to live in as the result of damages

caused by wind?

eines :

YES NO

If the answer to question #3 is “NO”, sign the form

and inform the Court.

If the answer to question #3 is “YES”, proceed to

question #4.

. Do you find that the Plaintiffs are entitled to

Additional Living Expenses as set forth in the

Lexington policy?

eae a

YES NO

If the answer to question #4 is “NO”, sign the form

and inform the Court.

If the answer to question #4 is “YES”, proceed to

question #5.

. What is the amount necessary to compensate the

Plaintiffs for their Additional Living Expenses?

/s/ Timothy Little

Timothy Little

Foreperson

08/15/07

Date

APPENDIX B

IN THE UNITED STATES DISTRICT COURT FOR

THE SOUTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

Civil Action No. 06-0360-WS-C

RICHARD PREIS and VICTORIA PREIS,

Plaintiffs,

vs.

LEXINGTON INSURANCE COMPANY,

Defendant.

FINAL JUDGMENT

In accordance with the verdict entered in the above

styled action, it is ORDERED, ADJUDGED and

DECREED that a FINAL JUDGMENT be, and the

same is entered in favor of the Plaintiffs, Richard and

Victoria Preis, and against the Defendant, Lexington

Insurance Company, in the amount of $70,000.00.

The Plaintiffs are entitled to recover from the

Defendant their taxable costs.

DONE and ORDERED this 2lst day of August,

2007.

/s/ William H. Steele

WILLIAM H. STEELE

United States District Judge

APPENDIX C

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

[Filed June 3, 2008]

No. 07-14228

D. C. Docket No. 06-00360-CV-WS-C

RICHARD PREIS, VICTORIA HEARIN PREIS,

Plaintiffs-Appellants,

versus

LEXINGTON INSURANCE COMPANY, T&B, LTD, d.b.a.

THAMES, BATRE’, MATTEI, BEVILLE, and ISON, et al.,

Defendants-Appellees.

Appeal from the United States District Court

for the Southern District of Alabama

(June 3, 2008)

Before DUBINA and BARKETT, Circuit Judges, and

SCHLESINGER, District Judge.

PER CURIAM:

Richard and Victoria Preis’ appeal from an adverse

partial summary judgment in favor of Lexington In-

Honorable Harvey E. Schlesinger, United States District

Judge for the Middle District of Florida, sitting by designation.

' For ease of discussion, we will hereinafter refer to the

Appellants in the singular, “Pries.”

surance Company, providers of Pries’ homeowner's

insurance policy; an adverse summary judgment in

favor of Thames, Batre, Mattei, Beville, and Ison

(“T&B”), the insurance agency that issued the Lex-

ington policy and Allen Ladd, its agent. Pries also

appeals from a jury verdict of $70,000, which the jury

awarded to Pries at the conclusion of a three-day

trial, based on purported evidentiary errors and er-

rors in the jury instructions. Pries seeks reversal of

the district court’s summary judgment rulings, and a

new trial.

I. Background

Pries’ home on Mobile Bay, in Point Clear, Ala-

bama, was severely damaged by Hurricane Katrina.

According to Pries, the house had a replacement value

in excess of $1,200,000 and the loss on personal prop-

erty in the house was in excess of $750,000.

Pries had two sets of insurance policies covering

the house and its contents. First, he had a home-

owner’s policy (“the Lexington policy”), originally

purchased in 1995. The Lexington policy was an all-

risk policy that insured against any direct loss of per-

sonal or structural property of the home at issue,

with certain exclusions. One of the exclusions of cov-

erage was for loss caused “directly or indirectly” by

“water damage”, defined as “flood, surface water,

wave, tidal water, overflow of a body of water, or

spray from any of these, whether or not driven by

wind ....” The Lexington policy is the only insurance

policy at issue in this appeal.

The second relevant set of insurance policies cov-

ering the property at issue at the time of Hurricane

Katrina was for flood damage. Preis had a primary

flood policy with Hartford Insurance Company, and an

excess flood insurance policy with WNC Insurance

Services. Following Hurricane Katrina, Pries submit-

ted a claim to both Hartford Insurance and to WNC

Insurance Services. Pries received a total of $587,659.71

from these flood insurance providers for the damage

incurred as a result of floods caused by the hurricane.

This amount constituted the full policy limits of both

policies.

Pries also notified Lexington of the loss in order to

recover for wind damage under the homeowners’ po)l-

icy and submitted the same claim of loss to Lexington

that had been submitted to the flood insurance carri-

ers. Within one week of Preis’ notification of the loss,

Lexington retained an independent adjuster, Reid

Jones McRorie & Williams, to investigate Pries’ claim.

Reid Jones issued a final report several months later,

indicating that the majority of the damage to the

house was a result of “storm surge”, and that the

“[moderate] wind damage was primarily limited to

the roof.” Reid Jones estimated that Pries was due a

payment in the amount of $72,155.96 for the damage

that had not been caused by flood waters. Based on

this assessment, Lexington made Pries an uncondi-

tional tender for $53,135.97, which reflected Reid

Jones’ estimate less the policy’s wind deductible of

$19,020.00.

Preis rejected Lexington’s tender of $53,135.97 and

notified Lexington of his intent to file this lawsuit

against Lexington. Lexington then retained the

engineering services of Project Time & Cost (““PT&C”)

to determine the cause and origin of Preis’ losses.

PT&C’s report confirmed that the majority of the

house was damaged as a result of storm surge, but

that some damage was attributable to wind damage.

Based on PT&C’s report, Reid Jones readjusted Pries’

estimated loss, and increased their unconditional

tender by $11,031.90 to $64,167.86. Pries again

rejected the loss amount, and proceeded to file the

instant suit.

A three-day jury trial was held in August 2007. At

the close of the evidence, and prior to the case being

submitted to the jury, the district court granted

Lexington’s Rule 50 motion for judgment as a matter

of law on Preis’ claim for damage to the contents of

the house, finding that Pries had failed to present

facts sufficient to allow the trier of fact to segregate

the amount of damages to the home’s contents at-

tributable to wind from those damages due to water

from the storm surge. After deliberating, the jury

awarded Pries $70,000 for damages to the structure

attributable to wind.

II. Discussion

Preis challenges several aspects of the trial, as well

as two of the district court’s rulings on summary

judgment. We address each issue in turn.

1. Evidentiary Rulings’

Preis argues that the district court erred in admit-

ting evidence of “the amount of the flood settlement

in the amount of $587,659.71,” and contends that

evidence of the flood payments is barred under Fed-

eral Rule of Evidence 408.° We have held that “[for

* We review the district court’s evidentiary rulings under a

deferential abuse of discretion standard. United States v. Fra-

zier, 387 F.3d 1244, 1258 (11 Cir. 2004) (en banc).

* Rule 408 provides in pertinent part: “Evidence of (1)

furnishing or offering or promising to furnish, or (2) accepting or

offering or promising to accept, a valuable consideration in com-

promising or attempting to compromise a claim which was dis-

puted as to either validity or amount, is not admissible to prove

10a

Rule 408 to apply, there must be an actual dispute, or

at least an apparent difference of opinion between

the parties, as to the validity of a claim.” Dalilis v.

Aetna Life Ins. Co., 768 F.2d 1303, 1307 (11th Cir.

1985). We have specifically rejected the notion that

“the payment of a claim by an insurance company,

where there is no evidence that the insurance com-

pany ever disputed the claim, qualifies as a compro-

mise within the meaning of Rule 408:” Id. 1306-07.

Since Pries submitted his claim to the flood insurers

and received the full policy limits from both of them

absent any dispute as to the validity of his claim, the

district court did not abuse its discretion in finding

that Rule 408 did not bar admissibility of the pay-

ments.

Pries also argues that the lay testimony of insur-

ance adjusters James Gibson and Tracy Clark should

not have been admitted into evidence under Federal

Rule of Evidence 701 because they did not have per-

sonal knowledge of the facts and because their testi-

mony was based on “scientific, technical, or other

specialized knowledge within the scope of Rule 702,”

which governs expert testimony. The testimony of-

fered by both Clark and Gibson specifically related to

the damage to the home they observed during the in-

spections they personally conducted, the reports they

each individually prepared regarding their assess-

ments of the damage to the Pries’ home, and the pro-

cedures they employed to reach their loss estimates.

Given the nature of their testimony, the district court

liability for or invalidity of the claim or its amount.” Fed. R.

Evid. 408.

lla

did not abuse its discretion in allowing the adjusters

to testify as lay witnesses.‘

2. Burden of Proof: Directed Verdict and Jury

Instructions

Preis contends that the district court’s application

of an erroneous burden of proof resulted in two er-

rors: 1) the court erroneously granted Lexington a di-

rected verdict on the question of Lexington’s liability

for the damage to the contents of the home; and 2)

the jury instruction regarding the burden of proof

was an erroneous statement of the law. We review

the allocation of the burden of proof de novo. Gu.a-

jardo v. Texas Dept. of Crim. Justice, 363 F.3d 392,

395 (5th Cir. 2004); see also United States v. DeVeg-

ter, 439 F.3d 1299, 1303 (11th Cir. 2003) (“We gener-

ally review de novo questions of law.”).

The Louisiana Supreme Court has stated that, “[i]n

an action under an insurance contract, the insured

bears the burden of proving the existence of the pol-

icy, and the coverage.” Turnstall v. Stierwald, 809

So.2d 916, 921 (La. 2002). The insured also bears the

threshold burden of proving an accidental direct

* Moreover, our review of the trial transcript indicates that

any opinion testimony offered by Clark or Cibson was in fact

solicited by Pries. See Doc. 236, p. 403,11. 9-11 (Clark asked on

cross, “Hypothetically, Mr. Clark, if windows blew out in this

house, would you consider the contents that would have been

damaged?”); Doc. 235, p. 231, II. 22-24 (Gibson asked on cross,

“What would have been your loss if you had to assume that the

whole thing had to be torn down?” Gibson responded, “You

know, I wouldn’t even wing that.”). The admission of inadmissi-

ble testimony, “when responding to an inquiry by [appellant’s]

counsel, creates ‘invited error’.” United States v. Parikh, 858

F.2d 688, 695 (11th Cir. 1988). “[I]nvited error constitutes nei-

ther plain nor reversible error.” /d.

12a

physical loss to the insured property, and the amount

of the loss. See Pelas v. Amer. Emp. Ins. Co., 299

So.2d 815, 817 (La. App. 1974) (“As in any action on

an insurance policy, the burden is upon the plaintiff

to prove the loss insured against.”) (Schott, J., dis-

senting); Brouillette v. Phoenix Assur. Co., 340 So.2d

667, 672 (La. App. 1977) (“Plaintiff had the burden of

proof on the amount of the loss.”). Once an insured

has met this initial burden, the burden then shifts to

the insurer to prove by a preponderance of the evi-

dence that the loss falls within a policy exclusion.

Turnstall, 809 So.2d at 921 (“The insurer, however,

bears the burden of showing policy limits or exclu-

sions?). The segregation or allocation of the causes of

the loss is left to the finder of fact once the parties

have met their initial burdens. See Broussard v. State

Farm Fire & Casualty Co., No. 07-60443, 2008 WL

921699, at *5-6 (5th Cir. Apr. 7, 2008). It is with this

appropriate burden of proof in mind that we now turn

to Preis’ arguments.

A. Directed Verdict

We review a district court’s ruling on a judgment

as a matter of law under Rule 50 de novo, examining

the evidence in the light most favorable to the non-

moving party. Optimum Tech. v. Henkel Consumer

Adhesives. Inc., 496 F.3d 1231, 1251 (11th Cir. 2007).

“Judgment as a matter of law is appropriate when a

plaintiff presents no legally sufficient evidentiary ba-

sis for a reasonable jury to find for him on a material

element of his cause of action.” Proctor v. Flor Enter-

prises, Inc., 494 F.3d 1337, 1347 n.5 (11th Cir. 2007).

Preis argues that the district court erroneously

granted Lexington’s Rule 50 motion with regards to

the contents because “the Plaintiffs have not identi-

fied any evidence that affords the jury a reasonable

13a

basis for separating losses due to wind from losses

due to flood.” Preis contends that this placed an in-

appropriately high and erroneous burden of proof

upon him, arguing that all he needed to do was es-

tablish the coverage, the loss and the loss amount,

and not the cause of the injury. We agree with Preis

regarding his burden, but agree with the district

court that this initial burden was not met by Preis in

this case. Had Preis simply established that he had

the requisite accidental damage coverage and that he

had been damaged in a specific amount, he would

have met his burden of proof under his all-risk policy.

Lexington would then have the burden to prove that

the damages claimed were the result of water, which

was a cause explicitly excluded by the coverage.

Here, however, Preis failed to initially establish a

basis from which the jury could have awarded an

amount for the personal property in the house that

was covered by the Lexington policy. Each of Preis’

witnesses in his case-in-chief conceded that there was

water damage and debris on the inside of the home

from the flooding, and the parties do not dispute that

water damage is not covered under the Lexington

policy. None of Preis’ witnesses testified regarding

any damage to the contents of the home not caused

by water, and Preis conceded that he submitted iden-

tical claims for the contents to both his flood insurers

and to Lexington. In short, Preis did not present any

evidence in his case-in-chief which would support a

jury finding that the contents were destroyed by any-

thing but water. Given the absolute lack of evidence

that the contents of the house were damaged by a

covered peril, no reasonable jury could find that Preis

had met his burden of proving the amount of covered

loss by a preponderance of the evidence. Under these

circumstances, we cannot find that the district court

l4a

erred by granting Lexington’s motion for judgment as

a matter of law regarding the contents of the Preis’

home.

B. Jury Instructions Regarding Burden of Proof

We review the challenged jury instructions under a

deferential standard of review. United States uv.

Puche, 350 F.3d 1137, 1148 (11th Cir. 2003). We do,

however, review them de novo to “determine whether

they misstate the law or mislead the jury to the

prejudice of the objecting party.” Brochu v. City of

Riviera Beach, 304 F.3d 1144, 1155 (11th Cir. 2002).

Having reviewed the jury instructions delivered by

the district court in their entirety, we cannot agree

with Preis that the district court misstated the law.

The district court accurately recited the burden of

proof under Louisiana law. The court instructed the

jurors that the initial burden is on the plaintiffs to

prove “the existence of the policy sued on, its terms

and provisions, that their claim is within its cover-

age, and the amount of their covered damage.” The

district court also instructed the jury that “it is the

insurer who bears the burden of proving the applica-

bility of any exclusion from coverage of the policy.”

Thus, the district court’s jury instructions regarding

the applicable burden of proof was an accurate state-

ment of law.

3. Jury Instruction Based on Debris

Preis next argues that the district court erred by

instructing the jury that “wind driven wood debris

was water damage and not covered.” The actual in-

struction the court delivered follows:

The exclusion for water damage excludes loss re-

sulting either directly or indirectly from flood,

and loss from debris that strikes covered prop-

15a

erty when carried there by flood waters is loss

caused indirectly by flood and is thus excluded.

We again review the challenged jury instruction

under a deferential standard of review. Puche, 350

F.3d at 1148.

The instruction given by the court limits the exclu-

sion from coverage to debris damage caused by flood

waters, and does not implicate “wind driven wood de-

bris” as suggested by Preis. Though the word “debris”

does not appear in the language of the water damage

exclusion, the language of the policy unambiguously

excludes damage caused directly or indirectly from

flood. Thus, the district court did not err in instruct-

ing the jury that damage from debris which strikes

the covered property as a result of floods is excluded

under the clear language of the water damage exclu-

sion.

4. Summary Judgment Rulings*

Finally, we have carefully reviewed this record and

find no error in the district court’s grant of summary

judgment against Preis on his claim that Lexington

acted in bad faith or on his claims against T&B and

Ladd.

AFFIRMED.

* We review a district court’s rulings on summary judgment

de novo. Mega Life and Health Ins. Co. v. Pieniozek, 516 F.3d

985, 989 (11th Cir. 2008). “Summary judgment is appropriate

when the evidence; viewed in the light most favorable to the

nonmoving party, presents no genuine issue of material fact and

compels judgment as a matter of law.” Jd.; Fed. R. Civ. P. 56(c).

16a

APPENDIX D

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

No. 07-14228-CC

Filed August 4, 2008

RICHARD PREIS, VICTORIA HEARIN PREIS,

Plaintiffs-Appellants,

LEXINGTON INSURANCE COMPANY,

T&B, LTD, d.b.a. Thames, Batre’, Mattel.,

Beville, and Ison, et al.,

Defendants-Appellees.

On Appeal from the United States District Court

for the Southern District of Alabama

ON PETITION(S) FOR REHEARING AND

PETITION(S) OR REHEARING EN BANC

Before: DUBINA and BARKETT, Circuit Judges, and

SCHLESINGER, District Judge.

PER CURIAM:

The Petition(s) for Rehearing are DENIED and no

Judge in regular active service on the Court having

requested that the Court be polled on rehearing en

* Honorable Harvey E. Schlesinger, United States District

Judge for the Middle District of Florida, sitting by designation.

17a

banc (Rule 35, Federal Rules of Appellate Procedure),

the Petition(s) for Rehearing En Banc are DENIED.

ENTERED FOR THE COURT:

/s/ Rosen Barkett

ROSEN BARKETT

United States Circuit Judge

18a

APPENDIX E

IN THE UNITED STATES COURT OF APPEALS

- FOR THE ELEVENTH CIRCUIT

[Filed June 3, 2008]

No. 07-14228

D. C. Docket No. 06-00360-CV-WS-C

RICHARD PREIS, VICTORIA HEARIN PREIS,

Plaintiffs-Appellants,

Vv.

LEXINGTON INSURANCE COMPANY, T&B, LTD, d.b.a.

THAMES, BATRE’, MATTEI, BEVILLE, and ISON, et al.,

Defendants-Appellees.

Appeal from the United States District Court

for the Southern. District of Alabama

JUDGMENT

It is hereby ordered, adjudged. and decreed that

the attached opinion included herein by reference, is

entered as the judgment of this Court.

Entered: June 3,2008 ~—

For the Court: Thomas K. Kahn, Clerk

By: Gilman, Nancy

Issued As Mandate August 12, 2008.

19a

APPENDIX F

Title 28 UNITED STATES CODE

Rules of Evidence for United States

Courts and Magistrates

Article VII. Compromise and Offers to Compromise

Rule 408. Compromise and Offers to Compromise

(a) Prohibited uses.—Evidence of the following is

not admissible on behalf of any party, when of-

fered to prove liability for, invalidity of, or

amount of a claim that was disputed as to va-

lidity or amount, or to impeach through a prior

inconsistent statement or contradiction:

(1) furnishing or offering or promising to fur-

nish—or accepting or offering or promising

to accept—a valuable consideration in com-

promising or attempting to compromise the

claim; and

(2) conduct or statements made in compromise

negotiations regarding the claim, except

when offered in a criminal case and the ne-

gotiations related to a claim by a public of-

fice or agency in the exercise of regulatory,

investigative, or enforcement authority.

(b) Permitted uses.—This rule does not require

exclusion if the evidence is offered for purposes

not prohibited by subdivision (a). Examples of

permissible purposes include proving a wit-

ness's bias or prejudice; negating a contention

of undue delay; and proving an effort to ob-

struct a criminal investigation or prosecution.

(Pub.L. 93-595, § 1, Jan. 2, 1975, 88 Stat. 1933; Apr.

12, 2006, eff. Dec. 1, 2006.)

20a

APPENDIX G

Title 28 UNITED STATES CODE

Rules of Evidence for United States Courts

and Magistrates

Article VII. Opinions and Expert Testimony

Rule 701 Opinion Testimony by Lay Witnesses

If the witness is not testifying as an expert, the

witness’ testimony in the form of opinions or infer-

ences is limited to those opinions or inferences which

are (a) rationally based on the perception of the

witness, (b) helpful to a clear understanding of the

witness’ testimony or the determination of a fact in

issue, and (c) not based on scientific, technical, or

other specialized knowledge within the scope of Rule

702.

(Pub.L. 93-595, § 1, Tan. 2, 1975, 88 Stat.1937; Mar.

2, 1987, eff. Oct. 1, 1987; Apr. 17, 2000, eff. Dec. 1,

2000.)

2la

APPENDIX H

Title 28 UNITED STATES CODE

Rules of Evidence for United States Courts

and Magistrates

Article VII. Opinions and Expert Testimony

Rule 702 Testimony by Experts

If scientific, technical, or other specialized knowl-

edge will assist the trier of fact to understand the

evidence or to determine a fact in issue, a witness

qualified as an expert by knowledge, skill, experi-

ence, training, or education, may testify thereto in

the form of an opinion or otherwise, if (1) the

testimony is based upon sufficient facts or data,

(2) the testimony is the product of reliable principles

and methods, and (3) the witness has applied the

principles and methods reliably to the facts of the

case.

(Pub.L. 93-595, § 1, Jan. 2, 1975, 88 Stat. 1937; Apr.

17, 2000, eff. Dec. 1, 2000.)

22a

APPENDIX I

Federal Rules of Civil Procedure Rule 51

United States Code Annotated

Federal Rules of Civil Procedure for the United

States District Courts

Title VI. Trials

Rule 51. Instructions to the Jury; Objections; Pre-

serving a Claim of Error

(a) Requests.

(1) Before or at the Close of the Evidence. At the

close of the evidence or at any earlier reason-

able time that the court orders, a party may

file and furnish to every other party written

requests for the jury instructions it wants the

court to give.

(2) After the Close of the Evidence. After the close

of the evidence, a party may:

(A) file requests for instructions on issues that

could not reasonably have been anticipated

by an earlier time that the court set for re-

quests; and

(B)with the court's permission, file untimely

requests for instructions on any issue.

(b) Instructions. The court:

(1) must inform the parties of its proposed in-

———__structions and proposed action on the requests

before instructing the jury and before final jury

arguments;

(2) must give the parties an opportunity to object

on the record and out of the jury's hearing be-

23a

fore the instructions and arguments are deliv-

ered; and

(3) may instruct the jury at any time before the

jury is discharged.

(LD) How to Make. A party who objects to an in-

struction or the failure to give an instruc-

tion must do so on the record, stating dis-

tinctly the matter objected to and the

grounds for the objection.

(2) When to Make. An objection is timely if:

(A)before that opportunity to object, and

the party objects promptly after learning

that the instruction or request will be, or

has been, given or refused.

(B)a party was not informed of an instruc-

tion or action on a request before that

opportunity to object, and the party ob-

jects promptly after learning that the

instruction or request will be, or has

been, given or refused

(d) Assigning Error; Plain Error.

(1) Assigning Error. A party may assign as er-

ror:

(A)an error in an instruction actually given,

if that party properly objected; or

(B)failure to give an instruction, if that

party properly requested it and—unless

the court rejected the request in a de-

finitive ruling on the record--also prop-

erly objected

(2) Plain Error. A court may consider a plain

24a

error in the instructions that has not been

preserved as required by Rule 51(d)(1) if the

error affects substantial rights.

(Amended March 2, 1987, effective August 1, 1987;

March 27, 2003, effective December 1, 2003; April

30, 2007, effective December 1, 2007.) 7

BEST AVAILABLE COPY

“TGNGTON INSURANCE COMPANY

LENA Zo: HOS HoWEOWMERDEClananows Pate —Subbrter copy -

Policy Number: LE DSH632 03

'Hame of insured and Walling Address: = = = =~ ~ —~*|

Richard Preis Thames Satre Matte! Bevie & Ison

Ge Mogan Co. PO Box 4769

pete nes -* Gulf Shores, AL 36547

Coverage Part 1 - Homeowners Past 2 - Personal Umbrelia

~ Coverage A: $ ep . $ t)

- Coverage B: $ 63.400 Self insured Retention $ v)

- Coverage C: $ 37900 Part 3- Excess Flood

- Coverage D: $ 53,400 - ry 0 cee $ mp0

- Loss Assessment 5 1,000 ~ Contents § 0 Emessol § 190,009

~ Ordinance or Law. 10% Part 4 ~ Scheduled

- Coverage €: $ 50,000 . .

- Coverage F: $ —° sp

Anivual Premium. $ ~ F3 |

Homecwners Deductoles 4 —

Al Other Perits: $ 1000 tespection Fee: 3 0.00

Wind and Halt: % Fee: s =e

Earthquake: — Surplus Lines Tax: $ 446.82

f XIGNAddVv

26a

Policy Number LE 0541632 03

Effective Date: 09/22/2004

Date Issued:08/26/2004

SCHEDULE FORMS AND ENDORSEMENTS

LEX 04 33 04 02

HO 00 03 04 91

HO 01 01 05 97

HO 04 14 04 91

HO 04 16 0491

HO 04 90 04 91

HO 04 96 04 91

HO 05 80 05 97

LEX 00 04 01 01

LEX 00 14 03 01

LEX 00 30 05 03

LEX 01 09 03 03

LEX 03 140101

LEX 05 80 01 01

LEX 15 31 08 01

Limited Mild Related Coverage

Homeowners 3 Special Form

Special Provisions — Alabama

Special Computer Coverage

Premises Alarm or Fire

Protection System

Personal Property Replacement

Cost

Home Day Care Exclusion

Remediation, Limited Lead & Es-

caped Liquid Fuel Liability Cov-

erages

Lexington Standard Policy Condi-

tions

Important Flood Insurance Notice

Exterior Insulation and Finish

System Exclusion

Special Provisions

Windstorm or Hail Percentage

Deductible

Advisory Notice to Policyholders —

Explanatory Memo

Special Personal Property Cover-

age

27a

POLICY NUMBER: LE 0541632 03

HOMEOWNERS

LEX 04 33 04 02

THIS ENDORSEMENT CHANGES THE POL-

ICY. PLEASE READ IT CAREFULLY.

LIMITED MOLD RELATED COVERAGE

(Coverage Part 1- Homeowners Only)

SCHEDULE”

These limits of liability apply to the total of all loss

or costs payable under this endorsement, regardless

of the number of “occurrences”, the number of claims

made, or the number of locations insured under this

endorsement and listed in this Schedule.

1. | Section 1— Property Coverage Limit | $5,000

Of Liability for the Additional Cover-

age “Mold Related Items”

2. | Section II — Coverage E Aggregate | $5,000

Sublimit Of Liability for “Mold Related

Items’

*Entries may be left blank if shown elsewhere in this

policy for this coverage.

DEFINITIONS

The following definitions are added:

“Mold Related Items” include the following defi-

nitions for “Fungus(i)”, “Mold(s)”, “Spore(s), but

also includes, Wet or Dry Rot, Bacteria, Mildew

or Yeast.

a. Fungus(i)’ includes, but is not limited to, any of

the plants or organisms belonging to the major

28a

group Fungi, lacking chlorophyll, and including

mids, rusts, mildews, smuts, mushrooms, and

any mycotoxins, spores, scents or byproducts

produced or released by fungi.

b. “Mold(sy includes, but is not limited to, any super-

ficial growth produced on damp or decaying or-

ganic matter or on living organisms, and fungi

c. “Spore(s)” means any dormant or reproductive

body produced by or arising or emanating out

of any “fungus(i)”, “mold(s), mildew, plants, or-

ganisms or microorganisms.

SECTION I PROPERTY COVERAGES

ADDITIONAL COVERAGES

The following Additional Coverage is added:

12. “Mold Related Items”

a. The amount shown in the Schedule above is

the most we will pay for:

(1) The total of all loss payable under Sec-

tionl— Property Coverages caused by ‘mold

related items”;

(2) The cost to remove “mold related items”

from properly covered under Section 1 —

Property Coverages;

(3) The cost to tear out and replace any part of

the building or other covered property as

needed to gain access to the “mold related

items’; and

(4) The cost of testing of air or property to con-

firm the absence, presence or level of *mold

related items’ whether performed prior to,

during or after removal, repair, restoration

29a

or replacement The cost of such testing will

be provided only to the extent that there is

a reason to believe that there is the pres-

ence of “mold related items”.

b. The coverage described in 12.a. only: applies

when such loss or costs are a result of a Peril

Insured Against that occurs during the policy

period and only if all reasonable means were

used to save and preserve the property from

further damage at and after the time the Peril

Insured Against occurred.

c. The amount shown in the Schedule for this cov-

erage is the most we will pay for the total of all

loss or costs payable under this Additional

Coverage regardless of the:

(1) Number of locations insured under this en-

dorsement or

(2) Number of claims made.

d. If there is covered loss or damage to covered

property, not caused, in whole or in part, by

“mold related items”, loss payment will not be

limited by the terms of this Additional Cover-

age, except to the extent that “mold related

items” causes an increase in the loss. My such

increase in the loss will be subject to the terms

of this Endorsement.

This coverage does not increase the limit of li-

ability applying to the damaged covered prop-

erty.

(This is Additional Coverage 11. in Form HO 00 06.)

SECTION I — PERILS INSURED AGAINST

30a

In Form HO 00 03 or HO 00 03, HO 00 04 and HO 00

06 with LEX 15 31:

Paragraph 2;043) or 1.b.(5X(c) (if LEX 15 31 Is at-

tached) is deleted and replaced by the following:

(3) or (c) Smog, rust or other corrosion; —

Paragraph 2.e.(9) or 1.b.(4(c) (if LEX 15 31 is at-

tached) is added:

(9) or (I) Constant or repeated seepage or leakage

of water or the presence or condensation of

humidity, moisture or vapor, over a period of

weeks, months or years unless such seepage or

leakage of water or the presence or condensa-

tion of humidity, moisture or vapor and the re-

sulting damage is unknown to all insureds”

and is hidden within the wails or ceilings or

beneath the floors or above the ceilings of a

structure.

In Form HO 00 06 with HO 17 31:

Paragraph 3.d.(3) is deleted and replaced by the

following:

(3) Smog, rust or other corrosion; Paragraph 34.(9)

is added:

(9) In Form HO 00 06 with HO 17 32:

Paragraph 2.e.(3) is deleted and replaced by the

following:

(3) Smog, rust or other corrosion; Paragraph

2.e.(9) is added:

(9) Constant or repeated seepage or leakage of wa-

ter or the presence or condensation of humid-

ity, moisture or vapor, over a period 01 weeks,

months or years unless such seepage or leak-

3la

age of water or the presence or condensation of

humidity, moisture or vapor and the resulting

damage is unknown to all “insureds” and Is

hidden within the walls or ceilings or beneath

the floors or above the ceilings of a structure.

SECTION I — EXCLUSIONS

Exclusion 1.1 is added.

“Mold Related items”

“Mold Related Items” including the presence,

growth, proliferation, spread or any activity of

“mold related items”.

This Exclusion does not apply:

(1) When “Mold Related Items’ results from

fire or lightning; or

(2) To the extent coverage is provided for in the

“Mold Related Items” Additional Coverage

under Section 1 — Property Coverages with

respect to loss caused by a Peril Insured

Against other than fire or lightning.

Direct loss by a Peril Insured Against resulting

from “Mold Related Items” is covered.

(This is Exclusion 9. in Form HO 00 04 and HO 00

064

SECTION II — CONDITIONS

Condition 1. Limit Of Liability is deleted and re-

placed by the following:

1. Limit Of Liability

Our total liability under Coverage E For all dam-

ages resulting from any one “occurrence” will not .

be more than the Coverage E limit of liability

32a

shown In the Declarations. This limit is the same

regardless of the number of “insureds” claims

made or persons injured. All “bodily injury” and

“property damage” resulting from any one acci-

dent or from continuous or repeated exposure to

substantially the same general harmful conditions

will be considered to be the result of one “occur-

rence”.

Our total liability under Coverage F for all medi-

cal expense payable for “bodily injury” to one per-

son as the result of one accident will not be more

than the Coverage F limit of liability cnewn | in the

Declarations.

However, our total liability under Coverage E for

the total of all damages arising directly or indi-

rectly, in whole or in part, out of the actual, al-

leged or threatened inhalation of, Ingestion of,

contact with, exposure to, existence of, or presence

of any “Mold Related Items” will not be more than

the Section II — Coverage E Aggregate Sublimit

Of Liability for “Mold Related items’. That sub-

limit is the amount shown in the Schedule. This is

the most we will pay regardless of the:

a. Number of locations insured under the pol-

icy to which this endorsement is attached;

b. Number of persons injured;

Number of persons whose property is dam-

aged;

d. Number of “insureds”-, or

e. Number of “occurrences” or claims made.

This sublimit is within, but does not In-

crease, the Coverage E limit of liability. It

applies separately to each consecutive an-

33a

nual period and to any remaining period of

less than 12 months, starting with the be-

ginning of the policy period shown in the

Declarations.

With respect to damages arising out of “Mold Related

Items” described in 1. Limit Of Liability of this en-

dorsement, Condition 2. Severability Of Insurance is

deleted and replaced by the following:

2. Severability Of Insurance

This insurance applies separately to each “in-

sured” except with respect to the Aggregate Sub-

limit of Liability described in this endorsement

under Section II — Conditions 1., Limit Of Liabil-

ity. This condition will not increase the limit of li-

ability for this coverage.

SECTION I AND II CONDITIONS

Condition 1. Policy Period is deleted and replaced by

the following:

1. Policy Period

This policy applies only to loss or costs in Section I

or “bodily Injury” or “property damage” in Section

Ii, which occurs during the policy period.

All other provisions of the policy apply. This limited

coverage applies to Coverage Part I Homeowners

only. No other coverage parts provide this type of

coverage.

HOMEOWNERS

HO 00 03 04 91

HOMEOWNERS 3

SPECIAL FORM

AGREEMENT

« We will provide the insurance described in this policy

in return for the premium and compliance with all

applicable provisions of this policy.

DEFINITIONS

In this policy, “you” and “your” refer to the “named

insured” shown in the Declarations and the Spouse if

a resident of the seine household. ‘We,’ “us” and “our”

refer to the Company providing this insurance. In

addition, certain words and phrases are defined as

follows:

1. “Bodily injury’ mean’s bodily harm, sickness or

disease, including required care, loss of ser-

vice’s and death that results.

2. “Business” includes trade, profession or occu-

pation.

3. “Insured” means you and residents of your

household who are:

a. Your relatives; or

b. Other persons under the age of 21 and in

the care of any person named above,

Under Section II, Insured” also means:

c. With respect to animals or watercraft to

which this policy applies, any person or or-

ganization legally responsible for these

animals or watercraft which are owned by

you or any person in-. eluded In 3.a. or 3.b.

35a

above, A person or organization .using or

having custody of these animals or water-

craft in the course of any “business” or

without consent of the owner is not an In-

sured”;

. With respect to any vehicle to which this

policy applies:

(1) Persons While ‘engaged in your employ

or that of any person Included in 3.a. or

3.b. above; or

(2) Other persons using. the vehicle on an

“insured location” with your consent.

4. “insured location” means:

. The “residence premises”;

. The part of other premises, other structures

and grounds used by you as a residence

and:

(1) Which is shown in the Declarations; or

(2) Which is acquired by you during the pol-

icy period for your use as a residence;

. Any premises used by you in connection

with a premises in 4.a. and 4.b, above;

. Any part of a premises:

(1) Not owned by an Insured”; and

(2) Where an Insured” is temporarily resid-

ing;

. Vacant land, other than farm land, owned

by or-rented to an Insured”;

36a

f. Land owned by or rented to an “insured” en

which a one or two family dwelling is being

built as a residence for an “insured”;

g. Individual or family cemetery plots or bur-

ial vaults of an “insured”; or

h. Any part of a premises occasionally rented

to an “insured” for other than “business”

aise.

5. “Occurrence” means an_ accident, including

continuous or repeated exposure to substan-

tially the same general harmful conditions,

which results, during the policy period, in:

a. “Bodily injury”; or

b. “Property damage.”

6. “Property damage” means physical injury to,

destruction of, or loss of use of tangible prop-

erty.

7. “Residence employee” means:

a. An employee of an “insured” whose duties

are related to the maintenance or use of the

“residence premises,” including household

or domestic services; or

b. One who performs similar duties elsewhere

not related to the “business” of an insured.”

8. “Residence premises” means:

a. The one family dwelling, other structures,

and grounds; or

b. That part of any other building;

where you reside and which is shown as the

“residence premises” in the Declarations.

37a

“Residence premises” also means a two family

dwelling where you reside in at least one of the

family units and which is shown as the “resi-

dence premises” in the Declarations.

SECTION I — PROPERTY COVERAGES

COVERAGE A Dwelling

We cover:

1. The dwelling on the “residence premises

shown in the Declarations, including struc-

tures attached to the dwelling: and

2. Materials- and supplies- located on or next, to

the “residence premises” used to construct, al-

ter or repair the dwelling or other structures

on-the “residence premises.”

This coverage does not apply to land, including land

on which the dwelling is located.

COVERAGE B Other Structures

We cover other structures on the “residence prem-

ises” set apart from the dwelling by clear space. This

includes structures connected to the dwelling by only

a fence, utility line, or similar connection.

This coverage does not apply to land, including land

on which the other structures are located,

We do not cover other structures:

1. Used in whole or in part for “business”; or

2. Rented or held for rental to any person not a

tenant of the dwelling, unless used solely as a

private garage.

The limit of liability for this coverage will not be

more than 10% of the limit of liability for that applies

38a

to Coverage A. Use of this coverage does not reduce

the Coverage A limit of liability.

COVERAGE C — Personal Property

We cover personal property owned or used by an “in-

sured” while it is anywhere in the world.- At your

request, we will cover personal property owned by:

1. Others while the property is on the part of the

“residence premises” occupied by an “insured”;

2. A guest or a “residence employee,” while the

property is in any residence occupied by an

“insured.”

Our limit of liability for personal property usually lo-

cated at an ‘insured’s” residence, other than the

“residence premises,” is 10% of the limit of liability

for Coverage C, or $1000, whichever is greater. Per-

sonal property in a newly acquired principal resi-

dence is not subject to this limitation for the 30 days

from the time you begin to move the property there.

Special Limits of Liability. These limits do not in-

crease the Coverage C limit of liability. The special

limit for each numbered category below is the total

limit for each loss for all property in that category.

1. $200 on money, bank notes, bullion, gold other

than goldware, silver other than silverware,

platinum, coins and medals.

2. $1000 on securities, accownts, deeds, evidences

of debt, letters of credit, notes other than bank

notes, manuscripts, personal records, pass-

ports, tickets and stamps. This dollar limit

applies to these categories regardless of the

medium (such as paper or computer software)

on which the material exists.

10.

39a

This limit includes the cost to research, replace

or restore the information from the lost or

damaged material.

$1000 on watercraft, including their trailers,

furnishings, equipment and outboard motors.

$1000 on trailers not used with watercraft.

$1000 for loss by theft of jewelry, watches,

furs, precious and semi-precious stones.

$2000 for loss by theft of firearms

$2500 for loss by theft of silverware, silver-

plated ware, goldware, gold-plated ware and

pewterware. This includes flatware, hollow-

ware, tea sets, trays and trophies made of or

including silver, gold or pewter.

$2500 on property, on the “residence prem-

ises,” used at any time or in any manner for

any “business” purposes

$250 on property, away from the “residence

premises,” used at any tme or in aany manner

for any “business” purpose. However, this

limit does not apply to loss to adaptable elec-

tronic apparatus as described in Special Limits

10 and 11 below.

$1000 for loss to electronic apparatus, while

not in or upon a motor vehicle or other motor-

ized land conveyance, if the electronic appara-

tus is equipped to be operated by power from

the electrical system of the vehicle or convey-

ance while retaining its capability of being op-

erated by other sources of power. Electronic

apparatus includes:

a. Accessories and antennas; or

40a

b. Tapes: wires, records, discs or other media;

for use with any electronic apparatus.

11.$1000 for loss to electronic apparatus, while

not in or upon a motor vehicle or other motor-

ized land conveyance, if the electronic appara-

tus:

a. is equipped to be operated by power from

the electrical system of the vehicle or con-

veyance while retaining its capability of be-

ing operated by other sources of power

b. is away from the “residence premises”; and

is used at any time or in any manner for

any “business purpose”.

Electronic apparatus includes:

a. Accessories and antennas’ or

b. Tapes, wires, records, discs or other media;

for use with any electronic apparatus.

Property Not Covered We do not cover:

Articles separately described and specifically in-

sured in this or other insurance;

Animals, birds or fish;

Motor vehicles or all other motorized land convey-

ances. This includes:

a. Their equipment and accessories; or

b. Electronic apparatus that is designed to be op-

erated solely by use of the power from the elec-

trical system of motor vehicles or all other mo-

torized land conveyances. Electronic apparatus

includes:

(1) Accessories or antennas; or

4la

(2) Tapes, wires, records, discs or other media;

for use with any electronic apparatus.

The exclusion of properly described in 3.a. and

3.b. above applies only while the property is In

or upon the vehicle or conveyance.

We do cover vehicles or conveyances not subject to

motor vehicle registration which are:

a. Used to service an “insured’s” residence; or

b. Designed for assisting the handicapped;

. Aircraft and parts. Aircraft means any contriv-

ance used or designed for flight, except model or

hobby aircraft not used or designed to carry peo-

ple or cargo;

. Property of roomers, boarders and other tenants,

except property of roomers and boarders related to

an Insured”;

. Property In an apartment regularly rented or held

for rental to others by an Insured,” except as pro-

vided in Additional Coverages 10.;

. Property rented or held for rental to others off the

“residence premises”;

. “Business” data, including such data stored in:

a. Books of account, drawings or other paper re-

cords; or

b. Electronic data processing tapes, wires, re-

cords, discs or other software media;

However, we do cover the cost of blank re-

cording or storage media, and of pre-recorded

computer programs available on the retail

market; or

42a

9. Credit cards or fund transfer cards except as pro-

vided in Additional Coverages 6.

COVERAGE D-—Loss of Use

The limit of liability for Coverage D is the total limit

for all the coverages that follow.

1. If a loss covered under this Section makes that

part of the “residence premises” where you reside

not fit to live in, we cover, at your choice, either of

the following. However, if the ‘residence premises”

is not your principal place of residence, we will not

provide the option under paragraph b. below.

a. Additional Living Expense, meaning any nec-

essary increase in living expenses incurred by

you so that your household can maintain its

normal standard of living; or

b. Fair Rental Value, meaning the fair rental

Value of that part of the “residence premises”

where you reside lee’s any expenses that do not

continue while the premises is not fit to live in.

Payment under a, or b: will be for the shortest

time required to repair or replace the damage

or, if you permanently relocate; the shor:est

time required for your household to settle

elsewhere.

2. If a loss covered under this Section makes that

part of the “residence premises” rented to others

or held for rental by you not fit to live in, we cover

the:

Fair Rental Value, meaning the fair rental

value of that part of the “residence premises”

rented to others or held for rental by, you less

any expenses that do not continue while’ the

premises is not fit to live in,

43a

Payment will be for the shortest time required

to repair or replace that part’ of the premises

rented or held for rental.

3. If a civil authority prohibits you from use of the

“residence premises” as a result of direct damage

to neighboring premises by a Peril Insured

Against in this policy, we cover the Additional

Living Expense and Fair Rental Value loss as

provided under 1. and 2. above for no more than

two weeks.

The periods of time under 1., 2. and 3. above are not

limited by expiration of this policy.

We do not cover loss or expense due to cancellation of

a lease or agreement.

ADDITIONAL COVERAGES

1. Debris Removal. We will pay your reasonable ex-

pense for the removal of:

a. Debris of covered property if a Peril Insured

Against that applies to the damaged property

causes the loss; or

b. Ash, dust or particles ‘from a volcanic eruption

that has caused direct toss to a building or

property contained in a building.

This expense is included in the limit <f liability

that applies to the damaged property. If the

amount to be paid for the actual damage to the

property plus the debris removal expense is

more than the lirnit of liability for the dam-

aged property, an additional 5% of that limit of

liability is available for debris removal ex-

pense.

44a

We will also pay your reasonable expense, up

to $500, for the removal from the “residence

premises” of:

a. Your tree(s) felled by the peril of Wind-

storm or Hail;

b. Your tree(s) felled by the peril of Weight of

Ice, Snow or Sleet; or

c. A neighbors tree(s) felled, by a Peril In-

sured Against under Coverage C;

provided the tree(s) damages a covered structure.

The $500 limit is the most we will pay in any one loss

regardless of the number of fallen trees.

2. Reasonable Repairs. In the event that covered

property is damaged by an applicable Peril In-

sured Against, we will pay the. reasonable cost in-

curred by you for necessary measures taken solely

to protect against further damage. if the measures

taken involve repair to other damaged property;

we will pay for those measures only if that prop-

erly Is covered under this policy and the damage

to that property is caused by an applicable Peril

Insured Against.

This coverage:

a. Does not Increase the limit of liability that ap-

plies to the covered property;

b. Does not relieve you of your duties, in case of a

loss to covered’ property, as set forth in SEC-

TION 1-CONDITION 2.d.

3. Trees, Shrubs and Other Plants. We cover trees,

shrubs, plants or lawns, on the “residence prem-

ises,” for toss caused by the following Perils In-

sured Against: Fire or lightning, Explosion, Riot

45a

or civil commotion, Aircraft, Vehicles not owned or

operated by a resident of the ‘residence premises,”

Vandalism or malicious mischief or Theft.

We will pay up to 5% of the limit of liability that

applies to the dwelling for all trees, shrubs, plants

or lawns. No more than $500 of this limit will be

available for any one tree, shrub or plant. We do

not cover property grown for “business” purposes.

This coverage is additional insurance.

Fire Department Service Charge. We will pay up

to $500 for your liability assumed by contract or

agreement for fire department charges incurred

when the fire department is called to save or pro-

test covered property Win a Peril Insured Against.

We do not cover fire department service charges if

the property is located within the limits of the

city, municipality or protection district furnishing

the fire department response.

This coverage is additional insurance. No deducti-

ble applies to this coverage.

Property Removed. We insure covered property

against direct loss from any cause while being re-

moved from a premises endangered by a Peril In-

sured Against and for no more than 30 days while

removed. This coverage does not change the limit

of liability’ that applies to the property being re-

moved.

Credit Card, Fund Transfer Card, Forgery and

Counterfeit Money.

We will pay up to $500 for:

a. The legal obligation of an Insured” to pay be-

cause of the theft or unauthorized use of credit

46a

cards issued to or registered in an “insured’s”

name;

Loss resulting from ‘theft or unauthorized use

of a fund transfer card used for deposit, with-

drawal or transfer of funds, issued to or regis-

tered in an “insured’s” name;

Loss to an “insured” caused by forgery or al-

teration of any check or negotiable instrument;

and

Loss to an “insured” through acceptance In

good faith of counterfeit United States or Ca-

nadian paper currency.

We do not cover use of a credit card or fund transfer

card:

By a resident of your household:

By a person who has been entrusted with ei-

ther type of card; or

If an “insured” has not complied with all terms

and conditions under which the cards are is-

sued.

All loss resulting from a series of acts committed

by any one person or in which any one person

is concerned or implicated is considered to be

one loss.

We do not cover loss arising out of “business” use

or dishonesty of an “insured.”

This coverage is additional insurance. No deducti-

ble applies to this coverage.

Defense:

We may investigate and settle any claim or

suit that we decide is appropriate. Our duty to

47a

defend a claim or suit ends when the amount

we pay for the loss equals our limit of liability.

b. If a suit is brought against an Insured” for, li-

ability under the Credit Card or Fund Transfer

Card coverage, we will provide a defense at our

expense by counsel of our choice.

c. We have the option to defend at our expense

an “insured” or an “insured’s” bank against

any suit for the enforcement of payment under

the Forgery coverage.

7. Loss Assessment. We will pay up to $1000 for ;

your share of loss assessment charged during the ,

policy period against you by a corporation or asso- )

ciation of properly owners, when the assessment

is made as a result of direct loss to the property,

owned by all members collectively, caused by a

Peril Insured Against under COVERAGE A—

DWELLING, other than earthquake or land shock

wave’s or tremors before, during or after a vol-

canic eruption.

This coverage applies only to loss assessments

charged against you as owner or tenant of the

“residence premises”.

We do- not Cover loss assessments charged

against you or a corporation or association of prop-

erty owners by any governmental body.

The limit of $1000 is the most we will pay with re-

spect to any one loss, regardless of the number of

assessments.

Condition 1. Policy Period, under SECTIONS I

AND II CONDITIONS, does not apply to this cov-

erage.

48a

8. Collapse. We insure for direct physical loss to cov-

ered property involving collapse of a building or -

any part of a building caused only by one or more

of the following:

a. Perils Insured Against in COVERAGE C —

PERSONAL PROPERTY. These perils apply to

covered buildings and personal property for

loss insured by this additional coverage;

b. Hidden decay:

c. Hidden insect or vermin damage;

d. Weight of contents, equipment, animals or

people;

e. Weight of rain which collects on a roof; or’

f. Use of defective material or methods in con-

strrction, remodeling or renovation if the col-

lapse occurs during the course of the construc-

tion, remodeling or renovation.

Loss to an awning, fence, patio, pavement, swim-

ming pool, underground pipe, flue, drain, cesspool,

septic tank, foundation, retaining wall, bulkhead,

pier, wharf or dock is not included under items b.,

c., d., e., and f. unless the loss is a direct result of

the collapse of a building.

Collapse does not include settling, cracking,

shrinking, bulging or expansion.

This coverage does not increase the limit of liabil-

ity applying to the damaged covered property.

9. Glass or Safety Glazing Material.

We cover:

49a

a. The breakage of glass or safety. glazing mate-

rial which is part of a covered building, storm

door or storm window; and

b. Damage to covered property by glass or safety

glazing material which is part of a building,

storm door or storm window.

This coverage does not include loss on the “resi-

dence premises” if the dwelling has been vacant

for more than 30 consecutive days immediately

before the toss. A dwelling being constructed is

not considered vacant.

Loss for damage to glass will be settled on the ba-

sis of replacement with safety glazing materials

when required by ordinance or law.

This coverage does not increase the limit of liabil-

ity that applies to the damaged property.

10. Landlord’s Furnishings. We will pay up to $2500

for your appliances, carpeting and other house-

hold furnishings, in an apartment on the “resi-

dence premises’ regularly rented or held for rental

to others by an “insured,” for loss caused only by

the following Perils Insured Against:

a. Fire or lightning.

b. Windstorm or hail.

This peril does not include loss to the properly

contained in a building caused by rain, snow,

sleet, sand or dust unless the direct force of wind

or hail damages the building causing an opening

in a roof or wall and the rain, snow, sleet, sand or

dust enters through this opening.

This peril includes loss to watercraft and their

trailers, furnishings, equipment, and outboard

50a

engines or motors, only while inside a fully en-

closed

c. Explosion.

d. Riot or civil commotion.

e. Aircraft, including self-propelled missiles and

spacecraft.

f. Vehicles.

g. Smoke, meaning sudden and accidental dam-

age from smoke

This peril does not include loss caused by smoke

from agricultural smudging or industrial opera-

tions.

h. Vandalism or malicious mischief.

i. Falling objects.

This peril does not include loss to property con-

tained in a building unless the roof or an outside

wall of the building is first damaged by a falling

object. Damage to the falling object itself is not In-

cluded.

j. Weight of ice, snow or sleet which causes dam-

age to property contained in a building.

k. Accidental discharge or overflow of water or

steam from within a plumbing, heating, air

conditioning or automatic fire protective sprin-

kler system or. from within a household appli-

ance.

This peril does not include loss:

(1) To the system or appliance from which the

water or steam escaped;

5la

(2) Caused by or resulting from freezing except

as provided in the peril of freezing below: or

(3) On the “residence premises” caused by ac-

cidental discharge or overflow which occurs

off the “residence premises.”

In this peril, a plumbing system does not include a

sump, sump pump or related equipment.

1. Sudden and accidental tearing apart, cracking,

burning or bulging of a steam or hot water heat-

ing system, an air conditioning or automatic fire

protective sprinkler system, or an appliance for

heating water.

We do not cover loss caused by or resulting from

freezing under this peril.

m. Freezing of a plumbing, heating, air conditioning

or automatic fire protective sprinkler system-or of

a household appliance.

This peril does not include loss on the residence

premises’: while the dwelling is unoccupied,

unless you have used reasonable care to:

(1) Maintain heat in the building: or

(2) Shut off the water supply and drain the system

and appliances of water.

n. Sudden and accidental damage from artificially

generated electrical current.

This peril does not include loss to a tube, (transis-

tor or similar electronic component).

o. Volcanic eruption other than_ loss caused by

earthquake, land shock waves or tremors.

52a

The $2500 limit is the most we will pay in any one

loss regardless of the number of appliances; carpeting

or other household furnishings involved in the loss.

SECTION I —PERILS INSURED AGAINST

COVERAGE A — DWELLING and COVERAGE B —

OTHER STRUCTURES

We insure against risk of direct loss to properly de-

scribed in Coverages A and B only if that loss is a

physical loss to property. We do not insure, however,

for loss:

1. Involving collapse, other than as provided in Ad-

ditional Coverage Be

2. Caused by:

a. Freezing of a plumbing, heating, air condition-

ing or automatic fire protective sprinkler sys-

tem or of a household appliance, or by dis-

charge, leakage or overflow from within the

system or appliance caused by freezing. This

exclusion applies only while the dwelling is va-

cant, unoccupied or being constructed, unless

you have used reasonable care to:

(1) Maintain heat in the building; or

(2) Shut off the water supply and drain the

system and appliances of water;

b. ‘Freezing, thawing, pressure or weight of water

or ice, whether driven by wind or not, to a:

(1) Fence, pavement, patio or swimming pool;

(2) Foundation, retaining wall, or bulkhead; or

(3) Pier, wharf or dock;

53a

c. Theft in or to a dwelling under construction, or

of materials and supplies: for use in the con-

struction until the dwelling is finished and oc-

cupied;

d. Vandalism and malicious mischief if the dwell- .

ing has been vacant for more than 30 consecu-

tive days immediately before the loss. A dwell-

ing being constructed is not considered vacant,

e. Any of the following:

(1) Wear and tear, marring, deterioration;

(2) Inherent vice, latent defect, mechanical

breakdown;

(3) Smog, rust or other corrosion, mold, wet or

dry rot;

(4) Smoke from agricultural smudging or in-

dustrial operations;

(5) Discharge, dispersal, seepage, migration,

release or escape of pollutants unless the

discharge, dispersal, seepage; migration, re-

lease or escape is itself caused by a Peril

Insured Against under Coverage C of this

policy.

Pollutants means any solid, liquid, gaseous

or thermal irritant or contaminant, includ-

ing smoke, vapor, soot, fumes, acids, alka-

lis, chemicals and Waste. Waste includes

materials to be recycled, réconditioned or

reclaimed;

(6) Settling, shrinking, bulging or expansion,

including resultant cracking, of pavements,

patio’s, foundations, walls, floors, roofs or

ceilings;

54a

(7) Birds, vermin, rodents, or insects; or

(8) Animals owned or kept by an “Insured.” If

any of these cause water damage not oth-

erwise excluded, from a plumbing, heating,

air conditioning or automatic tire protective

spire Kier system or household appliance,

we cover loss caused by the water including

the cost of tearing out and replacing any

part of a building necessary to repair the

system or appliance_ We do not cover loss

to the system or appliance from which this

water escaped.

3. Excluded under Section 1 — Exclusions,

Under items 1. and 2., any ensuing loss to property

described in Coverages A and B not excluded or ex-

cepted in this policy is covered.

COVERAGE C — PERSONAL PROPERTY

We insure for direct physical loss to the property ‘de-

scribed in Coverage C caused by a peril listed below

unless the loss is excluded in SECTION I —

EXCLUSIONS.

1. Fire or lightning.

2. Windstorm or hail.

This peril does not include loss to the property

contained in a building caused by rain, snow,

sleet, sand or dust unless the direct force of wind

or hail damages the building causing an opening

in a roof or wall and the rain, snow, sleet, sand or

dust enters through this opening.

This peril includes loss to watercraft and their

trailers, furnishings, equipment, and outboard

55a

engine’s or motors, only while inside -a fully en-

closed building. |

. Explosion.

. Riot or civil commotion

. Aircraft, including self-propelled missiles and

spacecraft.

. Vehicles.

. Smoke, meaning sudden and accidental damage

from smoke.

This peril does not include toss caused by smoke

from agricultural smudging or industrial Opera-

tions.

. Vandalism or malicious mischief.

. Theft, including attempted theft and loss of prop-

erty from a known place when it is likely that the

property has been stolen.

This peril does not include loss caused by theft:

a. Committed by an “insured”;

b. In or to a dwelling under construction, or of

materials and supplies for use in the construc-

tion until the dwelling is finished and occu-

pied; or

c. From that part of a “residence premises”

rented by an “insured” to other than an “in-

sured.”

This peril does not include ‘loss caused by theft

that occurs off the “residence premises” of:

a. Property while at. any other residence owned

by, rented to, or occupied by an Insured, except

while an “insured’ is temporarily living there.

56a

Property of a student who is an “insured” is

covered while at a residence away from home if

the student has been there at any time during

the 45 days immediately before the loss,

b. Watercraft, and their furnishings, equipment

and outboard engines or motors; or

c. Trailers and campers,

10. Falling objects.

This peril does not include loss to property con-

tained in a building unless the roof or an outside

wall of the building is first damaged by a falling

object. Damage to the falling object itself is not in-

cluded:

11. Weight of ice, snow or sleet which causes damage

to properly contained in a building.

12. Accidental discharge or overflow of water or steam

from within a plumbing, heating, air conditioning

or automatic fire protective sprinkler system or

from within a household appliance.

This peril does not include loss:

a. To the system or appliance from which the wa-

ter or steam escaped;

b. Caused by or resulting from freezing except as

provided in the peril of freezing below; or

c. On the “residence premises’ caused by acciden-

tal discharge or overflow which occurs off the

“residence premises.”

In this peril, a plumbing .system does not include

a sump, sump pump or related equipment,

13. Sudden and accidental tearing apart, cracking,

burning or bulging of a steam or-hot water

57a

heating system, an air conditioning or auto-

matic fire protective sprinkler system, or an

appliance for heating water.

We do not cover loss caused by or resulting from

freezing under this peril.

14. Freezing of ‘a plumbing, heating, air condition-

ing or automatic fire protective sprinkler sys-

tem or of a household appliance. a

This peril does not include loss on the “residence

premises” While the dwelling is unoccupied,

unless you have used reasonable care to:

a. Maintain heat in the building; or

b, Shut off the water supply and drain the system

and appliances of water.

15.Sudden and accidental damage from artifi-

cially generated electrical current.

This peril does not include loss to a tube, transis-

tor or similar electronic component.

16. Volcanic eruption other than loss caused by

earthquake, land shock waves or tremors.

SECTION | a EXCLUSIONS

. We do not insure for loss caused directly or indi-

rectly by any of the following. Such loss is ex-

cluded regardless of any ‘other cause or event con-

tributing concurrently or in any sequence to the

loss.

a. Ordinance or Law, Meaning enforcement of

any ordinance or law regulating the construc-

tion, repair, or demolition of a building or other

structure, unless specifically provided under

this policy.

58a

b. Earth Movement, meaning earthquake- includ-

ing land shock waves or tremors before, during

or after a volcanic eruption; landslide; mine

subsidence; mudflow; earth sinking, rising or

shifting; unless direct loss by:

(1) Fire;

(2) Explosion; or

(3) Breakage of glass or safety glazing material

which is part of a ‘building, storm door or

storm window;

ensues and then we will pay only for the ensu-

ing loss.

This exclusion does not apply to loss by theft. c.

Water Damage, meaning:

c. Water Damage, meaning

(1) Flood, surface water, waves, tidal water,

overflow of a body of water, or spray from

any of these, whether or not driven by

wind;

(2) Water which backs up through sewers or

drains or which overflows from a sump; or

(3) Water below the surface of the ground, in-

cluding water which exerts pressure on or

seeps or leeks through a building, sidewalk,

driveway, foundation, swimming pool or

other structure.

Direct loss by fire, explosion or. theft resulting

from water damage is covered.

. Power Failure, meaning the failure of power or

other utility service if the failure takes place

off the “residence premises.” But, if a Peril In-

59a

sured Against ensues on the “residence prem-

ises,” we will pay Only for that ensuing loss.

Neglect, meaning neglect of the “insured’ to

use all reasonable means to save and preserve

property at and after the time of a loss.

War, including the following and any conse-

quence of any of the following:

(1) Undeclared war, civil war, insurrection, re-

bellion or revolution;

(2) Warlike act by a military- force or military

personnel; or

(3) Destruction, seizure or use for a military

purpose.

Discharge of a nuclear weapon will be deemed

a warlike act even if accidental.

. Nuclear Hazard, to the extent set forth in the

Nuclear Hazard Clause of SECTION [I —

CONDITIONS

. Intentional Loss, meaning any loss arising out

of any act committed:

(1) By or at the direction of an “insured”; and

(2) With the intent to cause a loss.

2. We do not insure for loss to property described in

Coverages A and B caused by any of the following.

However, any ensuing loss to property described

in Coverages A and B not excluded pr excepted in

this policy is covered.

a. Weather conditions. However, this exclusion

only applies if weather conditions contribute in

any way with a cause or event excluded in

paragraph 1. above to produce the loss;

60a

b. Acts or decisions, including the failure to act or

decide, of any person, group, organization or

governmental body;

Faulty, inadequate defective:

(1) Planning, zoning, development, surveying,

siting;

(2) Design, specifications, workmanship, re-

pair, construction, renovation, remodeling,

grading, compaction;

(3) Materials used in repair, construction,

renovation or remodeling; or

(4) Maintenance;

of part or all of any property whether on or off

the “residence premises.”

SECTION I — CONDITIONS

1. Insurable Interest and Limit of Liability. Even if

more than one person has an insurable interest in

the property covered, we will not be liable in any

one loss:

To the “Insured” for more than the amount of

the “insured’s” interest at the time of loss; or

For more than the applicable limit of liability.

2. Your Duties After Loss. In case of a loss to covered

property, you roust see that the Following are

done:

a. Give prompt notice to us or our agent;

b. Notify the police in case of loss by theft;

c. Notify the credit card or fund transfer card

company in case of loss under Credit Card or

Fund Transfer Card coverage;

6la

. Protect the property from further damage. If

repairs to the property are required, you must:

(1) Make reasonable and necessary repairs to

_ protect the property, and

(2) Keep an accurate record of repair record

Prepare an inventory of damaged personal

property showing the quantity, description, ac-

tual cash value and amount of loss. Attach all

bills, receipts and relate documents that justify

the figures in the inventory.

As often as we reasonably require:

(1) Show the damaged properly;

(2) Provide us with records and documents we

request and permit us to make copies; and

(3) Submit to examination under oath, while

not in the presence of any other “insured”

and sign the same.

g. Send to us, within BO days after our request,

your signed, sworn proof of loss which sets

forth, to the best of your knowledge and belief:

(1) The time and cause of loss;

(2) The interest of the “insured” and all others

in the properly involved and all liens on the

property;

(3) Other insurance which may cover the loss;

(4) Changes In title or occupancy of the prop-

erty during the term of the policy;

(5) Specifications of damaged buildings and de-

tailed repair estimates;

62a

(6) The inventory of damaged personal prop-

erty described in 2.e. above;

(7) Receipts for additional living expenses in-

curred and records that support the fair

rental value toss; and

(8) Evidence or affidavit that, supports a claim

under the Credit Card, Fund Transfer

Card, Forgery and Counterfeit Money cov-

erage stating the amount and cause of loss.

3. Loss Settlement Covered property losses are set-

tled as follows;

a. Property of the following types:

(1) Personal property;

(2) Awnings, carpeting, household appliances,

outdoor antennas and outdoor equipment,

whether or not attached to buildings: and

(3) Structures that are not buildings;

at actual cash value at the ‘time of loss but not

more than the amount required to repair or re-

place:

b. Buildings under Coverage A or B at replace-

merit cast without deduction for depreciation;

subject to the following:

(1) if, at the time of loss, the amount of Irmo- -

ance in this policy on the damaged building

is ‘80% or more of the full replacement cost

of the building immediately before the loss,

we will pay the lost to repair or replace, af-

ter application of deductible and without

deduction for depreciation, but not more

than the least of the following amounts:

63a

(a) The limit of liability under this policy

that applies to the building;

(b) The replacement cost of that part Of the

building damaged for like construction

and use on the same premises; or

repair or replace the damaged building.

(2) If, at the time of loss, the amount of insur-

ance in this policy on the damaged building

is less than 80% of the full replacement cost

of the building immediately before the loss,

we will pay the greater of the following

amounts, but not more than the limit of

ability under this policy that applies to the

building:

(a) The actual cash value of that part of the

building damaged; or

(b) That proportion, of the cost to repair or

replace; after application of deductible

and without deduction for depreciation,

that part of the building damaged,

which the total amount of insurance in

this policy on the damaged building

bears to 80% of the replacement cost of

the building.

(3) To determine the amount of insurance re-

quired to equal 80% of the full replacement

cost of the building immediately before the

loss, do not Include the value of:

(a) Excavations, foundations, piers or any

supports which are below the undersur-

face of the lowest basement floor;

64a

(b) Those supports in (a) above’ which are

below the surface of the ground inside

the foundation walls, if there is no

basement; and

drains.

(4) We will pay no more than the actual cash

value of the damage until actual repair or

replacement. is complete. Once ‘actual re

pair or replacement is complete, we will set

tie the kiss according to the provisions of

b.(1) and b.(2) above.

However, If the cost to repair or replace the

damage is both:

(a) Less than 5% of the amount of insur-

ance in this policy on the building; and

(b) Less than $2500;

we will settle the loss according to the pro-

visions of b.(1) and b.(2) above whether or

not actual repair or replacement is com-

plete.

(5) You may disregard the replacement cost

loss settlement provisions and make claim

under this policy for loss or damage to

buildings on an actual cash value basis.

You may then make claim within 180 days

after loss for any additional liability accord-

ing to the provisions of this Condition 3.

Loss Settlement.

4. Loss to a Pair or Set. In case of loss to a pair or set

we may elect to:

65a

a. Repair or replace any part to restore the pair

or set to its value before the loss; or

b. Pay the difference between actual cash value of

the property before and after the loss.

5. Glass Replacement. Loss for damage to glass

caused by a Peril insured Against will be settled

on the basis of replacement with safety glazing

materials when required by ordinance or law.

. Appraisal. If you and we fail to agree on the

amount of loss, either may demand an appraisal

of the loss. In this event, each party will choose a

competent appraiser within 20 days after receiv-

ing a written request from the other. Tne two ap-

praisers will choose an umpire. If they cannot

agree upon an umpire within 15 days, you or we

may request that the choice be made by a judge ‘of

a court of record in the state where the “residence

premises” is located. The appraisers will sepa-

rately set the amount of loss. If the appraisers

submit a written report of an agreement to us, the

amount agreed upon will be the amount of loss. If

they fail to agree, they will submit their differ-

ences to the umpire. A decision agreed to by any

two will set the amount of loss.

Each party will:

a. Pay its own appraiser and

b. Bear the other expenses of the appraisal and

umpire equally.

. Other Insurance. If a loss covered by this policy is

also covered by other insurance, we will pay only

the proportion of the loss that the limit of liability

that applies under this policy bears to the total

amount of insurance covering the loss.

66a

8. Suit Against Us. No action can be brought unless

the policy provisions have been complied with and

the action is started within one year after the date

of loss.

9. Our Option. It we give you written notice within

30 days after we receive your signed, sworn proof

of. loss, we may repair or replace any part of the

damaged property with like property.

10.Loss Payment, We will adjust all losses with you.

We will pay you unless some other person is

named in the policy or is legally entitled to receive

payment. Loss will be payable 60 days after we

receive your proof of loss and:

a. Reach an agreement with you;

b. There is an entry of a final judgment; or c.

There is a filing of an appraisal award with us.

11. Abandonment of Property. We need not accept

any property abandoned by an “insured.”

12. Mortgage Clause.

The word “mortgagee” includes trustee.

If a mortgagee is named in this policy, any loss

payable under Coverage A or 13 will be paid to the

mortgagee and you, as interests appear. If more

than one mortgagee is earned, the order of pay-

ment will be the same as the order of precedence

of the mortgages. -

If we deny your claim, that denial will not apply to

a valid claim of the mortgagee, if the mortgagee:

a. Notifies us of any change in ownership, occu-

pancy or substantial change in risk of which

the mortgagee is aware;

67a

b. Pays any premium due under this policy on

demand It you have neglected to pay the pre-

mium; and’

c. Submits a signed, sworn statement of loss

within 60 days after receiving notice from us of

your failure to do so. Policy conditions relating

to Appraisal, Suit- Against Us and Loss Pay-

ment apply to the mortgagee.

If we decide to cancel or not to renew. this policy,

the mortgagee wilt be notified at least 10 days be-

fore the date cancellation or nonrenewal takes ef-

fect.

If we pay the mortgagee for any loss and deny

payment to you:

a: We are subrogated to all the rights of the

mortgagee granted under the mortgage on the

property; or

b. At our option, we may pay to the mortgagee

the whole principal on the mortgage plus any

accrued interest. In this event, we will receive

a full assignment and transfer Of the mortgage

and all securities held as collateral to the fried-

gage debt.

Subrogation will not impair the right of the mort-

gagee to recover the full amount of the mort-

gagee’s claim.

13.No Benefit to Bailee. We will not recognize any

assignment or grant any coverage that benefits a

person or organization holding, storing or moving

property for a fee regardless of any other provision

of this policy.

14. Nuclear Hazard Clause.

68a

a. “Nuclear Hazard” means any nuclear reaction,

radiation, or radioactive contamination, all

whether controlled or uncontrolled or however

caused, or any consequence of any of these.

b. Loss caused by the nuclear hazard will not be

considered loss caused by fire, explosion, or

smoke, whether theta perils are specifically

named in or otherwise included within the Per-

ils Insured Against in Section 1.

c. This policy does not apply under Section 1 to

lost caused directly or indirectly by nuclear

hazard, except that direct loss by fire resulting

from the nuclear hazard is covered.

15. Recovered Property. If you or we recover any

property for which we have made payment under

this policy, you or we will notify the other of the

recovery. At your option, the property will be re-

turned to or retained by you or it will become our

property. If the recovered property is returned to

or retained by you, the loss payment will be ad-

justed based on the amount you received for the

recovered property.

16. Volcanic Eruption Period. One or more volcanic.

eruptions that occur within a 72-hour period will

be considered as one volcanic eruption.

SECTION II — LIABILITY COVERAGES

COVERAGE E Personal Liability

If a claim is made or a suit is brought against an “in-

sured for damages because of “bodily injury” or

“property damage” caused by an “occurrence” to

which this coverage applies, we will:

1. Pay up to our limit of liability for the damages for

which the “insured” is legally liable. Damages in-

69a

clude prejudgment interest awarded against the

“insured”; and

Provide a defense at our expense by counsel of our

choice, even if the suit is groundless, false or

fraudulent. WO may investigate and settle any

claim or suit that we decide is appropriate. Our

duty to settle or defend ends when the amount we

pay for damages resulting from the ‘occurrence”

equals our limit of liability.

COVERAGE F Medical Payments To. Others

We will pay the necessary medical -expenses that are

incurred or medically ascertained within three years

from the date of an accident causing “bodily injury.”

Medicale expenses means reasonable charges for

Medical, surgical, x-ray, dental, ambulance, hospital,

professional nursing, prosthetic devices and funeral

services. This coverage’ does not apply to you or.

regular residents of your household except “residence

employees.” As to others, this coverage applies only:

To a person on the Insured location” with the

permission of an “insured”; or

To a person off the “insured location,” if the “bod-

ily injury”:

a. Arises out of a condition on the “insured loca-

tion” or the ways immediately adjoining;

b. Is caused by the activities of an “insured”;.

Is caused by a “residence employee” in the

course of the “residence employee’s” employ-

ment by an Insured”; or

d. Is caused by an animal owned by or in the care

of an “insured.”

SECTION II — EXCLUSIONS

70a

1. Coverage E - Personal Liability and Coverage F —

Medical Payments to Others do not apply to “bod-

ily injury” or “property damage”:

Which is expected or intended by the “insured”;

Arising out of or in connection with a “busi-

ness” engaged in by an “Insured.” This exclu-

sion applies but is not limited to an act or

omission, regardless of Its nature or circum-

stance, involving a service or duty rendered,

promised, owed, or implied to be provided be-

cause of the nature of the “business”;

Arising out of the rental or holding for rental of

any part of any premises by an Insured.” This

exclusion does not apply to the rental or hold-

ing for rental of an “insured location”:

(1) On an occasional basis if used only as a

residence;

(2) In part for use onlyas a residence. unless a

single family unit is intended for use by the

occupying family to lodge more than two

roomers or boarders; or

(3) In part; as an office, school, studio or pri-

vate garage;

Arising out of the rendering of or failure to

render professional services;

Arising out of a premises:

(1) Owned by an “insured”;

(2) Rented to an “insured”; or

(3) Rented to others by an “insured”; that is not

an Insured location”;

f. Arising out of:

Tla

(1) The ownership, maintenance, use, loading

or unloading of motor vehicles or all other

motorized land conveyances, including

trailers, owned or operated by or rented or

loaned to an “insured”;

(2) The entrustment by an “insured” of a motor

vehicle or any other motorized land convey-

ance to any person; or

(3) Vicarious liability, whether or not statuto-

rily imposed, for the actions of a child or

minor using a conveyance excluded In

paragraph (1) or (2) above.

Ti.is exclusion does not apply to;

(1) A trailer not towed by or carried on a Mo-

torized land conveyance.

(2) A motorized land conveyance designed for

recreational use off public roads, not subject

to motor vehicle registration and:

(a) Not owned by art Insured”; or

(b) Owned by an Insured” and on an In-

sured location”;

(3) A Motorized golf cart when used to play golf

on a golf course;

(4) A vehicle or conveyance not subject to mo-

tor vehicle registration which is:

(a) Used to service an “insured’s” residence;

(b) Designed for assisting the handicapped;

g. Arising put of:

72a

(1) The ownership, maintenance, use, loading,

or unloading of an excluded watercraft de-

scribed below;

(2) The entrustment by an “insured” of an wa-

tercraft described to any person; or

(3) Vicarious liability, whether or not statuto-

rily imposed, for the actions of a child or

minor using an excluded watercraft de-

scribed below

Excluded watercraft are those that are princi-

pally designed to be propelled by engine power

or electric motor or are sailing vessels whether

owned by or rented to an “insured. This exclu-

sion does not apply to watercraft:

(1) that are not sailing vessels and are powered

by:

(a) Inboard or inboard-outdrive engine or

motor power of 50 horsepower or less

not owned by “insured”;

(b) Inboard or inboard-outdrive engine or

motor power of 50 horsepower or more

not rented to “insured”;

with 25 total horsepower

(d) One or more outboard engines or motors

with more than 25 horsepower owned by

an “insured” if: |

(i) You acquire them prior to the policy

period; and

(a) You declare them at policy incep-

tion; or

73a

(b) Your intention to insure is re-

ported to us in writing within 45

days after you acquire the out-

board engines or motors.

(ii) You acquire them during the policy

period

This coverage applies for the policy pe-

riod.

(2) that are sailing vessels, with, or without

auxiliary power:

(a) Less than 26 feet in overall length;

(b) 26 feet or more in overall length, not

owned by or rented to an “insured.”

(3) that are stored;

h. Arising out of:

(1) The ownership, maintenance, use, loading

or unloading of an aircraft.

(2) The entrustment by an “insured” of an air-

craft to any person; or

(3) Vicarious liability, whether or not statuto-

rily imposed, for the actions of a child or

minor using an aircraft.

i. Caused directly or indirectly by war, including

the following and any consequence of any of

the following

(1) Undeclared war, civil war, insurrection, re-

bellion or revolution

j. Which arises out of the transmission of a com-

municable disease by an “insured”;

74a

k. Arising out of sexual molestation, corporal

punishment or physical or mental abuse; or

1. Arising out of the use, sale, manufacture, de-

livery, transfer or possession by any person of

a Controlled Substance(s) as defined by the

Federal ‘Food and Drug Law at 21 U.S.C.A.

Sections 811 and 812. Controlled Substances

include but are not limited to cocaine, LSD,

marijuana and all narcotic drugs. However,

this exclusion does not apply to the legitimate

use of prescription drugs by a person following

the orders of a licensed physician.

Exclusions e., f., g., and h. do not apply to “bodily

injury” to a “residence -employee” arising out of

and in the course of the “residence employee’s.’

employment by an “insured.”

2. Coverage E— Personal Liability, does not apply to:

a. Liability:

(1) For any loss assessment charged against

you as a member of an association, corpora-

tion or community of property owners;

(2) Under any contract or agreement. However,

this exclusion does not apply to written con-

tracts:

(a) That directly relate to the ownership,

maintenance or use of an “insured loca-

tion”; or

(b) Where the liability of others is assumed

by the “insured” prior to an “occurrence”;

unless excluded in (1) above or else-

where in this policy,

75a

“Property damage” to property owned by the

“insured”;

“Property damage” to property rented to, occu-

pied or used by or in the care of the “insured.”

This exclusion does not apply to “property

damage” caused by fire, smoke or explosion;

“Bodily injury” to any person eligible to receive

any benefits:

(1) Voluntarily provided; or

(2) Required to be provided;

by the “insured” under any.

(1) Workers’ compensation law;

(2) Non-occupational disability law; or

(3) Occupational disease law;

“Bodily injury” or “property’ damage” for which

an “insured” under this policy:

(1) Is also an insured under a nuclear energy

liability policy; or

(2) Would be art insured under that policy but

for the exhaustion of its limit of liability.

A nuclear energy liability policy is one issued

by.

(1) American Nuclear Insurers;

(2) Mutual Atomic_ Energy Liability Under-

writers; .

(3) Nuclear. Insurance Association of Canada.;

or any of their successors; or

76a

f. “Bodily injury” to you or an “insured” within

the meaning of part a_ or b. of Insured” as de-

fined.

3. Coverage F — Medical Payments to Others, does

not apply to “bodily injury”:

a. To a “residence employee” if the “bodily in-

jury”:

(1) Occurs off the “insured location”; and

(2) Does net arise out of or in the course of the

“residence employee’s” employment by an

“insured”;

b. To any person eligible to receive benefits:

(1) Voluntarily provided; or

(2) Required to be provided;

under any:

(1) Workers’ compensation law;

(2) Non-occupational disaoility law; or

(3) Occupational disease law;

c. From any:

(1) Nuclear reaction;

(2) Nuclear radiation; or

(3) Radioactive contamination;

all whether controlled or uncontrolled or

however caused; or

(4) Any consequence of any of these; or

d. To any person, other than a ‘residence em-

ployee” of an “Insured,” regularly residing on

any part of the “insured location.”

77a

SECTION II — ADDITIONAL COVERAGES

We cover the following in addition to the limits of li-

ability:

1. Claim Expenses. We pay:

Expenses we incur end costs texed against an

“insured” in any suit we defend;

Premiums on bonds required in a suit we de-

fend, but not for bond amounts more than the

limit of liability for Coverage E. We need not

apply for or furnish any bond;

Reasonable expenses incurred by an “insured”

-at our request, including actual loss of earn-

ings (but not loss of other income) up to $50

per day, for assisting us in the investigation or

defense of a claim or suit; and.

Interest on the entire judgment which accrues

after entry of the judgment and before we pay,

or tender, or deposit in court that part of the

judgment which does not exceed the limit of li-

ability that applies..

2. First Aid Expenses. We will pay expenses for first

aid to others Incurred by an- “insured” for “bodily

injury” covered under. this policy. We will not pay

for first aid to you or any other “insured.”

3. Damage to Property of Others. We will pay, at re-

placement cost, up to $50a per “occurrence”, for

‘property damage” to property of others caused by

an ‘insured.”

We will not pay for “property damage”:

a. To the extent of any amount recoverable under

Section], of this policy;

78a

caused intentionally by an Insured” who is 13

years of age or older;

To property owned by an “insured”;

To property owned by or rented to a tenant of

an Insured” or a resident in your household; or

Arising out of:

(1) A “business” engaged in by an “insured”;

(2) Any act, or omission in connection with a

premises owned, rented or controlled by an

“insured,” other than the “insured location”;

(3) The ownership, maintenance,- or use of air-

craft, watercraft or motor vehicles or all

other motorized land conveyances:

This exclusion does not apply to a motorized

land conveyance designed for recreational use

off public roads, not subject to motor vehicle

registration arid not owned by an “insured.”

. Loss Assessment. We will pay up to $1600 for

your share of loss assessment charged during the

policy period against you by a corporation or asso-

ciation of property owners, when the assessment

is made as a result of:

“Bodily Injury” or “property damage” not ex-

cluded under Section II of this policy; or

Liability for an -act of a director, officer ‘or

trustee In the capacity as a director, officer or

trustee, provided:

(1) The director, officer or trustee is elected by

the members of a corporation or association

of property owners; and

79a

(2) The. director, officer or trustee serves with-

out deriving any income from the exercise

of duties which are solely on behalf of a

corporation .or association of property own-

ers..

This coverage applies only to loss assessments

charged against you as owner or tenant of the

“residence premises”.

We do not cover loss assessments charged against

you or a corporation or association of property

owners by any governmental body.

Regardless of the number of assessments, the knit

of $1000 is the most we will pay for loss arising

out of:

a. One accident, including continuous or repeated

exposure to substantially the same general

harmful condition; or

b. A covered act of a director, officer or trustee.

An act involving more than one director, officer

or trustee is considered to be a single act.

The following do not apply to this coverage:

1. Section II - Coverage E - Personal Liability Ex-

clusion 2.a.(1);

2. Condition 1. Policy Period, under SECTIONS I

AND II - CONDITIONS.

SECTION II - CONDITIONS

. Limit of Liability, Our total liability under Cover- ©

age E for all damages resulting from any one “oc-

currence” will not be more than the limit Of liabil-

ity for Coverage E as shown in the Declarations.

This limit is the seine regardless of the number of

“insured’s,” claims made or persons injured: All

80a

“bodily injury” and “property damage” resulting

from any one accident or from continuous or re-

peated exposure to substantially the same general

harmful Conditions shall be considered to be the

result of and “occurrence.”

Our total liability under. Coverage F for all medi-

cal expense payable for “bodily injury! to one per-

son as .the result of one accident will not be more

than the limit of liability for Coverage F as shown

in the Declarations.

. Severability of Insurance. This Insurance applies

separately to each Insured: This condition will not

increase our limit of liability for any one “occur-

rence.”

. Duties After Loss. in case of an accident or “occur-

rence,” the “insured” will perform the following

duties that apply. You will help us by seeing that

these duties are performed:

a. Give written notice to us or our agent as soon

as is practical, which sets forth:

(1) The identity of the policy and Insured”;

(2) Reasonably available information on the

time, piece and circumstances ‘of the acci-

dent or “occurrence”; and

(3) Names and addresses of any claimants and

witnesses;

b. Promptly forward to us every notice, demand,

summons or other process relating to the acci-

dent or “occurrence”;

c. At our request, help us:

(1) To make settlement;

8la

(2) To enforce any right of contribution or in-

demnity against any person or organization

who may be liable to an “insured”;

(3) With the conduct of suits and attend hear-

ings and trials; and

(4) To secure and give evidence and obtain the

attendance of witnesses;

d. Under the coverage - Damage to Property of

Others - submit to us within 60 days after the

loss, a sworn statement of loss and show the

damaged property, if In the “insured’s” control;

e. The “insured” will not, except at the “insured’s”

own cost, .Voluntarily, make payment, assume

obligation or incur expense other than for first

aid to others at the tir e of the “bodily injury”

4. Duties of an injured Person - Coverage F - Medical

Payments to Others.

The injured person or someone acting for the in-

jured person will:

a. Give us written proof of claim, under oath if

required, as soon as is practical; and

b. Authorize us to obtain copies of medical re-

ports and records.

The injured person will submit to a physical exam

by a doctor of our choice when and as often as we

reasonably require,

5. Payment of Claim - Coverage F - Medical Pay-

ments to Others. Payment under this coverage is

not an admission of liability by an ‘insured” or us.

82a

Suit Against Us. No action can be brought against

us unless there has been compliance with the pol-

icy provisions.

No one will have the right to join us as a party to

any action- against an Insured.” Also, no action

with respect to Coverages can be brought against

us until the obligation of the “insured” has been

determined by final judgment or agreement

Signed by us.

Bankruptcy of an Insured. Bankruptcy or insol-

vency of an “insured” will not relieve us of our ob-

ligations under this policy.

Other Insurance — Coverage E — Personal Li-

ability. This insurance is excess over other valid

and collectible insurance except insurance written

specifically to cover as excess over the limits of li-

ability that apply in this policy.

SECTIONS I AND II CONDITIONS

lL.

Policy Period. This policy applies only to loss in

Section 1 or “bodily injury” or “property damage”

in Section II, which occurs during the policy pe-

riod.

. Concealment or Fraud. The entire policy will be

void If, whether before or after a loss, an Insured”

has:

a. Intentionally concealed or misrepresented any

material fact or circumstance;

b. Engaged in fraudulent conduct; or

c. Made false statements; relating to this insur-

ance.

Liberalization Clause. if we make a change which

broadens coverage under this edition of our policy

83a

without additional premium charge, that change

will automatically apply to your insurance as of

the date we implement the change in your state,

provided that this Implementation date falls

within 60 days prior to or during the policy period

stated in the Declarations.

This Liberalization Clause does not apply to

changes implemented through introduction of a

subsequent edition of our policy.

. Waiver or Change of Policy Provisions.

A waiver or change or a provision of this policy

must be in writing by us to be valid. Our request

for an appraisal or examination will not waive any

of our rights.

. Cancellation

a. You may cancel this policy at any time by re”

turning it to us or by letting us know in writ-

ing of the date cancellation is to take effect.’

b. We may cancel this policy only for the reasons

stated below by letting you know- in- writing of

the date cancellation takes effect. This cancel-

lam notice may be delivered to you, or’ mailed

to you at your mailing address _shown in the

Declarations.

Proof of mailing will be sufficient proof of notice.

(1) When you have not paid the -premium, we

may cancel at any time by letting you knew

at least 10 days before the date cancellation

takes-effect.

(2) When this policy has been in effect for less

than 60 days and, is. not a renewal with us,

we may cancel for any reason by letting you

84a

know at least 10 days before the date can-

cellation takes effect.

(3) When this policy has been in effect for 60

days or more, or at any time if it is a re-

newal with us, we may cancel:

(a) If there has been a material misrepre-

sentation of fact which if known to us

would have caused us not to issue the

policy; or

(b) If the risk has changed substantially

since the policy was issued.

This can be done by letting you know at

least 30 days before the date cancellation

takes effect.

(4) When this policy is written for a period of

more than one year, we may cancel for any

reason at anniversary by letting you know

at least 30 days before the date cancellation

takes effect.

c. When this policy is cancelled, the premium for

the period from the date of cancellation I. the

expiration date will be refunded pro rata.,

d. If the retuin premium is not refunded with the

notice of cancellation or when this policy is re-

turned to us, we will refund it within a reason-

able time after the date canceliation takes ef-

fect.

Nonrenewable. We may elect not to renew this

policy: We may do so by delivering to you, or mail-

ing to you at your mailing address shown in the

Declarations, written notice at least 30 days be-

fore the expiration date of this policy. Proof of

mailing will be sufficient proof of-notice,

85a

7. Assignment. Assignment of this policy will not be

valid unless we give our written consent.

8. Subrogation- An “insured” may waive in writing

before a loss alt rights of recovery against any

person. If not waived, we may require an assign-

ment of rights of recovery for a loss to the extent

that payment is made by us.

If an assignment is sought, an Insured” must sign

and deliver all related papers and cooperate with.

us.

Subrogation does not apply under. Section II to

Medical Payments to Others or Damage to Prop-

erty of Others.

9. Death. If any person named in the Declarations or

the spouse, if a resident of the same “household,

dies:

a. We insure the legal representative of the de-

ceased but only with respect to the premises

and property of the deceased covered under the

policy at the time of death;

b. ‘Insured” includes:

(1) Any member of your household who is an

“insured” at the time of your death, but

only while a resident of the “residence

premises”; and

(2) With respect to your properly, the person

having proper temporary custody of the

property until appointment and qualifica-

tion of a legal representative.

86a

HOMEOWNERS

HO 01 01 05 97

THIS ENDORSEMENT CHANGES THE. POLICY.

PLEASE READ IT CAREFULLY.

SPECIAL PROVISIONS ALABAMA

- SECTION 1— PROPERTY COVERAGES

Throughout this policy, the following is added to any

provision which uses the term actual cash value.

Actual cash value is calculated is the amount it

would cost to repair, or replace covered property, at

the time of loss or damage, with material of like kind

and quality, subject to a deduction for deterioration,

depreciation and obsolescence. Actual cash value ap-

plies ‘to valuation of covered property regardless of

whether that property has sustained partial or total

loss or damage.

The actual cash value of the lost or damaged property

may be significantly less than its replacement cost.

COVERAGE C — PERSONAL PROPERTY

SPECIAL LIMITS OF LIABILITY

Items 10. and 11 are deleted and replaced by- the fol-

lowing (These are Items 7. and 8. in Form HO 00 06):

10. $1,000 for lots to electronic apparatus, while in or

upon a motor vehicle or other motorized land con-

veyance, if the electronic, apparatus is equipped to

be operated by power from the electrical system of

the vehicle or conveyance While retaining its, ca-

pability of being operated by other sources of

power. Electronic apparatus includes:

a. Accessories or antennae; .or

87a

b. Tapes, wires, records, discs or other media; for

user with any electronic, apparatus described

4n this item-10:

11. $1,000 for loss to eletronic apparatus, While not in

or upon a motor vehicle or other motorized land

conveyance, if the electronic apparatus:

is equipped to be operated by power from the

electrical system of the vehicle or conveyance’

while retaining its capability of being -

operated by other sources of power;

Is away from the “residence premises”; and

Is used at any time or in any manner for any

“business” purpose.

Electronic apparatus includes:

a. Accessories and antennas; Or

b. Tapes; wires, records, discs or other media;

for use with any electronic apparatus described

this item 11.

PROPERTY NOT COVERED

Item 3.b. Is deleted and replaced by the following:

Motor-vehicles other motorized and conveyances.

This includes;

b. Electronic apparatus that Is designed to be op-

erated ‘solely by use cline power from the elec-

trical system of motor vehicles or all other’ mo-

torized land conveyances. Electronic apparatus

includes:

(1) Accessories or antennas: or

88a

(2) Tapes; wires, records; discs or other media;

for use with any electronic apparatus de-

scribed in this Item 3.b.

The exclusion of property described in 3.a. and

3.b. above applies only while the property is in or

upon the vehicle or conveyance.

We do cater vehicles or conveyances riot subject to

motor vehicle registration which are:

a. Used to service an ‘insured’s” residence; or

b. Designed for assisting the handicapped;

COVERAGE D— LOSS OF USE

For all forms other than HO 00 04 and HO 00 06,

‘Item”™ 1, is deleted and replaced by the following:

1. If a loss covered under this Section makes that

part of the “residence premises” where you reside.

not fit to live in, we cover the Additional Living

' Expense, meaning any necessary Increase, in liv-

ing expenses incurred by you so that your house-

hold can maintain its normal standardof living.

Payment will-be for the shortest-time required to

repair or replace toe damage, or, if you perma-

nently relocate, the shortest time required for

your household to settle elsewhere.

For Forms HO 00 04 and HO 00 06, Item 1. is deleted

and replaced by the following:

)..

if a loss by a Peril Insured Against under this pol-

icy to covered property or the building containing

the property makes .the “residence premises” not

fit to live in, we cover the Additional Living Ex-

pense, meaning any necessary increase in living

expenses incurred by you so that your household

can maintain its normal standard of living.

89a

Payment, will be for the shortest time required 10,

repair or replace the damage, or, if you perma-

nently relocate the shortest time required for your

household to settle elsewhere.

ADDITIONAL COVERAGES

9. Glass or Safety Glazing Material is deleted and re-

placed by the following:

9. Glass Or Safety Glazing Material

a. We cover:

(1) For all forms other than HO 00 04 and HO

00 06, the breakage of Glass or Safety Glaz-

ing Material which is part of a covered

building, storm door or storm Window, and

for

(a) Form HO 00 04, the breakage of Glass

or Safety Glazing Material which is part

of a building, storm door or-storm win-

dow, and covered as Building Additions

And Alterations; and

(b) Form HO 00 06, the breakage of Glass

or Safety Glazing Material which is part

‘of-a-building storm window, and cov-

ered under Coverage A; and

(2) For all forms other than HO 00 04 and HO

00 06, the breakage, caused directly by

Earth Movement, of Glass or Salty Glaz-ing

Material which Is part of a covered build-

ing, storm door or storm window, and for:

(a) Form HO 00 04; the breakage, caused

directly by Earth Movement, of Glass or

Safety Glazing Material which is part of

it building, storm door or storm window,

90a

and covered as Building Additions And

Alterations; and

(b) Form HO 00 06, the breakage, caused

directly by Earth Movement, of Glass or

Safety Glazing Material which is part of

a building, storm door or storm window,

and covered under Coverage A; and

(3) The direct physical force to cowered prop-

erty caused solely by the pieces, frag-ments,

splinters of broken glass or Safety Glazing

Material which is part of a build-ing, storm

door or storm window.

b. This coverage does not include loss:

(1) To covered properly which results because

the, Glass or Safety Glazing Material has

been broken, except as provided in a.(3)

above; or

(2) On the “residence premises” if the dwelling

has been vacant for more then 30 consecu-

tive days immediately before the loss. ex-

cept when the breakage results directly

from Earth Movement as provided for in a:

(2) above. A dwelling being constructed is

not considered vacant.

Loss to glass covered under this Additional Cov-

erage 9. will be settled on the basis of replacement

with safety, glazing materials when requited by

ordinance or law.

For Forms HO 00 01 and HO 00 08, we will pay

up to $100 for loss under this coverage.

This coverage does not increase the limit of liabil-

ity that applies to the damaged property.

9la

(This is Additional Coverage 8. in Forms HO 00 01

and HO 00 08.)

The following additional Coverage is forms except HO

00 08. With respect to Form HO 00 04, the .words

“covered building” used below, refer to property cov-

ered under Additional Coverage 10. Building Addi-

tions And Alterations.

11.Ordinance or Law

a. You may use up to 10% of the limit of liability

that applies to Coverage. A (or for Form HO 00

04, you may use up to 10% of the limit of liabil-

ity that applies to Building Additions And Al-

terations) for the increased costs you incur due

to the enforcement of any ordinance or law

which requires or regulates:

(1) The construction, demolition, remodel-ing.

renovation or repair of that parrot’s covered

building or other structure damaged by a

Peril Insured Against;

(2) The demolition and reconstruction of the

undamaged part of a covered building or

other structure, when that building or other

structure must be totally demolished be-

cause of damage by a Peril insured against

to. another part of that covered building or

other structure; or

(3) The remodeling, removal or replacement of

the portion of the undamaged part of a cov-

ered building or other structure necessary

to complete the remodeling, repair or re-

placement of that part of the covered build-

ing or other structure damaged’ by a Peril

insured Against.

92a

b. You may use all or part of this ordinance or

law coverage to pay for the increased costs you

incur to remove debris resulting from the con-

struction, demolition, remodeling, renovation,

repair or replacement of property as slated in

a. above.

c. We do not cover:

(1)The loss in value to any covered building or

other structure due to the require-ments of

any ordinance or law; or

(2)The costs to comply with any ordinance law

which requires any “insured” or others to

test for. monitor, clean up ‘remove, contain,

treat, detoxify or neutralize, or in any way

respond le, or assess the effects of, pollut-

ants on any covered building or other struc-

ture

Pollutants means any solid liquid, gaseous or

thermal irritant or contaminant, including

smoke, vapor, soot, fumes, acids, alkalis,

cl.cmicals and waste. Waste includes materials

to be recycled, reconditioned or reclaimed.

This coverage is additional insurance.

(This is Additional Coverage 10. in Forms HO

00 01 and HO 00 064

SECTION I - EXCLUSIONS

1. Ordinance or Law is deleted and replaced by the

following

1. Ordinance Or Law, meaning any ordinance or

law: :

a. Requiring or regulating the construction,

demolition, remodeling, renovation or repair of

93a

property, including removal of any result-ing

debris. This Exclusion l.a. in all forms other

than HO 00 03, 1.a.(1) in Form HO 00 03, does

not apply to the amount of, coverage that may

he provided for under Additional Coverage,

Class or Safety Glazing Material or Ordinance

or Law; |

b. The requirement’s of which result in a loss in

value to property, or

c. Requiring any “insured” or others to test for,

monitor, clean up, remove, contain, treat, de-

toxify or neutralize, or in any way respond to,

or assess the effects of, pollutants.

Pollutants means any. solid, liquid, gaseous

thermal irritant or contaminant, including smoke,

vapor, soot, fumes, acids, alkalis, chemicals and

waste. Waste includes materials to be recycled,

reconditioned or reclaimed.

This exclusion applies whether or not the Prop-

erty has been Physically damaged.

(This is Exclusion 1.a. in Form HO 00 03.

. Earth Movement is deleted and replaced by the

following:

. Earth Movement, meaning earthquake, include-

ing land shock waves -or tremors before, during or

after a volcanic eruption; landslide; mine subsi-

dence; mudflow; earth sinking, rising or shifting;

unless direct loss by:

a. Fire; or

b. Explosion;

ensues and then we will pay only for the ensuing

loss.

94a

This exclusion does not apply to loss by theft.

(This is Exclusion 1.b. in Form HO 00 03.)

Power Failure. is deleted and replaced by the fol-

lowing:

Power Failure, meaning the failure of power or

other utility service if the failure takes place off

the ‘residence premises” But if the failure of power

or other utility service results In a loss, from a

Peril Insured Against on the “residence premises”,

we will pay for the loss or damage caused by that

Peril Insured Against,

(This is Exclusion 1.d. in Form HO 00 03,)

SECTION I CONDITIONS

Loss Settlement

Under Form HO 00 06, Item b.(2) is deleted end

replaced by the following:,

(2) If the damage is not repaired or replaced

within. a reasonable time, at actual cash

value but ‘not more than the amount re-

quired to repair or replace.

SECTION II- EXCLUSIONS

Under 1. Coverage E Personal Liability and Coverage

F Medical Payments “To Others, Item a is deleted and

replaced by the following:

a. Which is expected or intended by one or more.

Insureds”;

SECTIONS I AND IT CONDITIONS

«>

See

‘)

ade

Concealment or Fraud is deleted and replaced by

the following:

Concealment or Fraud-

95a

a. Under Section I - Property Coverages, with re-

spect to all “insureds” covered. under this pol-

icy, we provide no coverage for lose under Sec-

tion I Property Coverages if, whether. been

before or after a loss, one or more “insureds”

have:

(1) intentionally concealed or misrepresented

any material fact or circumstance:

(2) Engaged in fraudulent conduct: or

(3) Made false statements; relating to this in-

surance.

b. Under Section II—Liability coverages, we do

not provide coverage to one or more “insureds”

who, whether before or after a loss, have:

(1) Intentionally concealed or misrepresented

any material fact or circumstanced;

(2) Engaged in fraudulent conduct; or

(3) Made false statements relating to this in-

surance. 7

All other provisions of this policy apply.

96a

THIS ENDORSEMENT CHANGES THE POLICY.

PLEASE READ IT CAREFULLY.

SPECIAL COMPUTER COVERAGE

All Forms Except HO 00 03 with HO 00 15

And HO 00 06 with HO 17 31

THIS ENDORSEMENT: (1) DOES NOT IN-

CREASE THE LIMIT OF LIABILITY WHICH AP-

PLIES TO COVERAGE C, AND (2) DOES NOT

MODIFY THE SPECIAL LIMITS OF LIABILITY OR

THE PROVISIONS OF PROPERTY NOT COVERED

UNDER COVERAGE C.

For an additional premium, the Perils Insured

Against which apply to Coverage C are deleted arid

replaced by the following with respect to “computer

equipment”:

Perils Insured Against We cover an “insured’s”

“computer equipment,” as defined in this endorse-

ment, against risk of direet physical loss.

We do not insure, however, for loss:

a. Excluded under SECTION 1 — EXCLUSIONS.

b. Caused by:

(1) Freezing of a plumbing, heating, air condi-

tioning or automatic fire protective sprin-

kler system or of a household appliance, or

by discharge, leakage or overflow from

within the system or appliance caused by

freezing, This exclusion applies only while

the dwelling is vacant, unoccupied or being

constructed, unless you have used reason-

able care to:

(a) Maintain heat in the building; or

97a

(b) Shut off the water supply and drain the

system arid appliances of water;

(2) Theft in or to a dwelling under construc-

tion, until the dwelling is finished and oc-

cupied;

(3) Any of the following:

(a) Wear and tear, marring, deterioration;

(b) Inherent vice, latent defect, mechanical

breakdown;

or dry trot

(d) Smoke from agricultural smudging or

industrial operations;

(e) Discharge, dispersal, seepage, migra-

tion, release or escape of pollutants

unless the discharge, dispersal, seepage,

migration, release or escape is itself

caused by one or more of the Perils In-

sured Against that would apply under

Coverage C of the policy form if this en-

dorse merit were not attached to the pol-

icy form.

Pollutants means any solid, liquid, gaseous

or thermal Irritant or contaminant, includ-

ing smoke, vapor, soot, fumes, acids, alka-

lis, chemicals and waste. Waste includes

materials to be recycled, reconditioned or

reclaimed;

(f) Settling, shrinking, bulging or expan-

sion, including resultant cracking, of

pavements, patios, foundations, walls,

floors, roofs or ceilings;

98a

(g) Birds, vermin, rodents or insects; or

(h) animals owned or kept by an “insured”.

If any of these cause water damage not

otherwise excluded, from a plumbing,

heating, air conditioning or automatic

fire protective sprinkler system or house-

hold appliance, we cover loss caused by

the water.

Under items (1) through (3), any ensuing loss not

excluded or excepted in this policy is covered.

(4) Vandalism and malicious mischief if the

dwelling has been vacant for more than 30

consecutive days immediately before the

loss. A dwelling being constructed is not

considered vacant;

(5) Dampness of atmosphere or extremes of

temperature unless the direct cause of loss

is rain, snow, sleet or hail;

(6) Refinishing, renovating or repairing prop-

erty;

(7) Collision, other than collision with a land

vehicle, sinking, swamping or stranding of

watercraft, including their trailers, furnish-

ings, equipment and outboard engines or

motors;

(8) Destruction, confiscation or seizure by or-

der of any government or public authority;

(9) Acts or decisions, including the failure to

act or decide, of any person, group, organi-

zation or governmental body. However, any

ensuing loss not excluded or excepted in

this policy is covered.

| 99a

DEFINITION

With respect to the coverage provided by this en-

dorsement, “computer equipment’ means:

1. Electronic data processing hardware and related

peripheral equipment, including CRT screens, disc

drives, printers and modems; and

2. Discs, tapes, wires, records or other software

media used with the equipment in 1. above.

All other provisions of this policy apply.

100a

HOMEOWNERS

HO 04 16 04 91

PREMISES ALARM OR

FIRE PROTECTION SYSTEM

For a premium credit, we acknowledge the installa-

tion of an alarm system or automatic sprinkler sys-

tem approved by us on .the “residence premises.” You

agree to maintain this system in working order and

to let us know promptly of any change made to the

system or if it is removed.

10la

HOMEOWNERS

HO 04 90 04 91-

THIS ENDORSEMENT CHANGES THE POLICY

PLEASE READ IT CAREFULLY

PERSONAL PROPERTY REPLACEMENT COST

SECTION I

For an additional premium, covered losses to the fol-

lowing property are settled at replacemerit cost’ at

life tithe alas:

a. Coverage 9 — Personal Property;

b. If covered in this policy, awnings, carpeting,

household appliances, outdoor antennas. and

outdoor equipment. whether or not attached to

buildings.

Personal Property Replacement Cost coverage will

apply to following articles or classes of property if

they are separately described and specifically in-

sured in this policy:

a. Jewelry;

b. Furs and garments, trimmed with tut Or con-

sisting principally of fur;

c. Cameras, projection machines, films and re-

lated articles of equipment;

d. Musical equipment and related ‘articles of

equipment;

e. Silverware,, silver-plated ware, goldware, gold-

plated ware and pewterware, but excluding

pens, pencils,. flasks, smoking Implements or

jewelry; and

102a

f. golfer’s equipment meaning golf clubs, golf

clothing and golf equipment.

Personal Property Replacement Cost coverage will

not apply to other classes of property separately

described and specifically insured.

1. PROPERTY NOT ELIGIBLE

Property listed below Is not eligible for replace-

ment cost settlement. Any foss will -be settled at ac-

tual casts value at the -time of loss but not more than

the amount required to repair or replace.

a. Antiques, fine arts, paintings and similar arti-

cles of rarity or antiquity which cannot be re-

placed.

b. Memorabilia; souvenirs, collectors items and

similar articles whose age or -history contrib-

ute to their value.

c. Articles not- maintained in good--or-workable-

a: condition.

d. Articles that are outdated or obsolete and are

stored or not being used.

2. REPLACEMENT COST

The following loss settlement procedure applies to

all property insured under this endorsement:

a. We will pay no more than the least of -the fol-

lowing amounts:

(1) Replacement cost at the time of loss with-

out deduction for depreciation;

(2) The full cost of repair at the time of loss;

(3) The limit of liability that applies to Cover-

age C. if applicable;

103a

(4) Any applicable. special limits of liability

stated in this policy; or

(5) For loss to any item separately described

and specifically insured in this policy the

limit of liability that applies to the item.

b. When the replacement cost for the entire loss

under this endorsement is more than $500, we

will pay no more than the actual cash value for

the leas or damage until the actual repair or

replacement is complete.

c. You may make a claim for loss on an actual

cash value basis and then make claim within

180 days after the loss for any additional liabil-

ity in accordance with this endorsement.

All other provisions of this policy apply.

104a

HOMEOWNERS

HO 04 96 04 91

NO SECTION II - LIABILITY COVERAGES FOR

HOME DAY CARE BUSINESS LIMITED SECTION

I - PROPERTY COVERAGES FOR HOME DAY

CARE BUSINESS

If an “insured” regularly provides home day care

services to a person or persons other than “insureds”

and receives monetary or other compensation for

such services, that enterprise is a “business.” Mutual

exchange of home day care services, however, is not

considered. compensation. The rendering of home day

care services by an Insured” to a relative of an “in-

sured” is not considered a “business.”

Therefore, with respect to a home day care enter-

prise which is considered to be a “business,” this pol-

icy:

1. Does not provide Section II — Liability Coverages

because a “business” of an “insured” is excluded

under exclusion 1.b. of Section IT — Exclusions;

2. Does not provide Section I — Coverage B coverage

where other structures are used in whole or in

part for “business”;

3. Limits coverage for property used on the ‘resi-

dence premises” for the home day care enterprise

to $2,500, because Coverage C Special Limits of

Liability — item 8. imposes that limit on “busi-

ness” property on the “residence premises.’ (Item

8, corresponds to item 5. in Form HO 00 08.);

4. Limits coverage for property used away from the

“residence premises” for the home day care enter-

prise to $250, because Coverage C Special Limits

of Liability — item 9. lmposes that limit on “busi-

105a

ness” property away from the “residence prem-

ises.” Special Limit of Liability item 9. does not

apply to adaptable electronic apparatus as de-

scribed in Special Limit of Liability items 10. and

11. (Items 9. 10. and 11. correspond to items 6., 7

and 8. respectively in Form HO 00 08.)

THIS ENDORSEMENT DOES NOT CONSTITUTE

A REDUCTION OF COVERAGE.

106a

POLICY NUMBER: HOMEOWNERS

HO 05 80 05 97

THIS ENDORSEMENT CHANGES THE POLICY.

PLEASE READ IT CAREFULLY.

PROPERTY REMEDIATION FOR ESCAPED

LIQUID FUEL AND LIMITED LEAD AND ES-

SAPED LIQUID FUEL LIABILITY COVERAGES

ALL FORMS EXCEPT FORMS

HO 00 04 AND HO 00 06

SCHEDULE

For the credit given or the premium charged, the cov-

erage provided by this endorsement and the applica-

ble Limits of Liability shown in this Schedule apply.

These limits of liability apply to the total of all loss,

damage or expense payable under this endorsement,

regardless of the number of locations insured under

this endorsement and listed in this Schedule.

1. Aggregate Limited Lead And Es- | $50,000

caped Liquid Fuel Liability Limit Of

Liability

2. Property Remediation For Escaped | $10,000

Liquid Fuel Limit Of Liability

This Property Remediation For Es-

caped Liquid Fuel Limit Of Liability

applies to the “residence premises” as

defined in Paragraphs a., b. or c. of

Definition 8. “Residence premises” In

this endorsement and any of the fol-

lowing locations as defined in Para-

graph d. of Definition 8. “Residence

premises”:

107a

* Entries may be left blank if shown elsewhere in

this policy for this coverage.

A. Definitions

The definitions applying to the policy form, other

than Definition 8. “Residence premises”, apply to

this endorsement. Definition 8. ‘Residence prem-

ises” is amended and Definitions 9. through 11.

are added only with respect to the coverage pro-

vided by this endorsement.

8. “Residence premises” means:

a. The one family dwelling, other structures,

and grounds where you reside;

b. That part of any other building where you

reside; or

c. A two family dwelling where you reside in

at least one of the family units;

and which is shown as the “residence premises” in

the Declarations; and

d. Any location shown in the Schedule of this

endorsement.

9. “Covered real property’. The following applies

only to the Section I — Additional Coverage — .

Property Remediation For Escaped Liquid

Fuel:

a. “Covered real property” means:

(1) Property owned by an Insured” and cov-

ered under Coverage A — Dwelling of

this policy;

(2) Any other one, two, three or four family

dwelling building owned by an “insured”

108a

and shown in the Schedule under item

(3) Materials and supplies located on or

next to the “residence premises”, used to

construct, alter or repair the dwelling or

other structures on the “residence prem-

ises”;

(4) Property owned by an “insured” and

covered under Coverage B — Other

Structures of this policy, provided such

property is located on the “residence

premises”; and

(5) Land, other than farm land:

(a) Which is within the “residence

premises”;

(b) Which is owned by an Insured”; and

described in Paragraphs 9.a.(1), (2),

(3) or (4) is located.

b. “Covered real property” does not include:

(1) Water;

(2) Other structures that are part of the

“fuel system”; or

(3) Trees, shrubs, plants or lawns, except to

the extent permitted by Paragraph 8.3.c.

of this endorsement.

10.“Covered personal property”. The following ap-

plies only to the Section 1 — Additional Cover-

age — Property Remediation For Escaped Liq-

uid Fuel:

109a

a. “Covered personal property” means personal

property:

(1) Owned or used by an “insured” and cov-

ered under Coverage C Personal Prop-

erty of this policy, and

(2) Located on the “residence premises”,

b. Loss or damage to such property shall be

subject to those Coverage C Special Limits

of Liability that apply.

11. “Fuel System” means:

a. One or more containers, tanks or vessels

which have a total combined storage capac-

ity of 100 or more U.S. gallons of liquid fuel;

and:

(1) Are, or were, used to hold liquid fuel

that is intended to be used solely for one

or more of the following:

(a) To heat or cool a building;

(b) To heat water;

(d) To power motor vehicles, other mo-

torized land conveyances or water-

craft owned by an Insured” and not

used at any time or in any manner

for “business”; and

(2) Are, or were, located on:

(a) “Covered real property”; or

(b) An “insured location”;

cludes the motor, gauge, nozzle, hose

110a

or pipes that are, or were, connected

to one or more containers, tanks or

vessels described in Paragraph 11.a.;

c. Filler pipes and flues connected to one or

more containers, tanks or vessels described

in Paragraph 11.a.;

d. A boiler, furnace or a water heater, the liq-

uid fuel for which Is stored in a container,

tank or vessel described in Paragraph 11.a.,

and which is located on:

(1) “Covered real property”; or

(2) An insured location”;

e. Fittings and pipes connecting the boiler,

furnace or water heater to one or more con-

tainers, tanks or vessels described in Para-

graph 11.a.; or

f. A structure that is specifically designed and

built to hold the liquid fuel that escapes

from one or more contairiers, tanks or ves-

sels described in Paragraph 11.a.

B. Section 1— Additional Coverages

The following Additional Coverage Is added:

PROPERTY REMEDIATION FOR ESCAPED

LIQUID FUEL

1. With respect to the total of all escapes of liquid

fuel from a “fuel system” which an “insured”

first discovers or learns of during the policy pe-

riod, we will pay up to the Limit of Liability

shown in the Schedule for loss, damage or ex-

pense described in Paragraph B.3.

llla

2. The Limit shown in the Schedule for this cov-

erage is the most we will pay for the total of all

loss, damage or expense payable under Para-

graph B.3. regardless of the:

Number of locations insured under this en-

dorsement;

Number of escapes of liquid fuel from a

“fuel system” an Insured” first discovers or

learns of during the policy period; or

Number of claims made.

3. Loss, Damage Or Expense Covered This Cover-

age pays for:

Loss or damage to:

1. “Covered real property”; or

2. Covered personal property;

caused directly or indirectly by the escape

of such fuel from a “fuel system”;

The reasonable expense you incur to:

(1) Take temporary measures to stop the

further escape of liquid fuel from any

part of the “fuel system”;

(2) Retard or stop the spread of escaped liq-

uid fuel;

(3) Clean up, remove or treat loss or dam-

age to:

(a) “Covered real property”; or

(b) “Covered personal property”; or

(4) Test, monitor or assess the effects of the

escape of liquid fuel on or away from

“covered real property”:

“ss

112a

(a) As required by law; or

(b) In response to a request, demand or

order by a governmental authority or

court of law.

We will pay for such expense only if it

results from the same escape that is

payable under Paragraph 8.3.a., or b.;

Loss or damage to trees, shrubs, plants or

fawns, located on the “residence premises”,

but only if there is loss, damage or expense

caused by the same escape that is payable

under Paragraph 8.3.a. or b. However, we

will not pay more than an amount equal to

5% of the Limit of Liability shown in the

Schedule for the total of all loss or damage

to trees, shrubs, plants or lawns. No more

than $500 of this amount will be payable

for any lawn or any one tree, shrub, or

plant We do not cover property grown for

“business’.

Under Form HO 00 08, no more than $250

of the amount of insurance available under

this coverage will be payable for lawns or

any one tree, shrub or plant; and

. Additional Living Expense

(1) Additional Living Expense means any

necessary increase in living expenses

you incur, so that your household can

maintain its normal standard of living,

if the escape of liquid fuel:

(a) Results in loss, damage or expense

payable under Paragraph B.3.a. or b.;

and

113a

(b) Makes that part of the “residence

premises” where you reside not fit to

live in.

(2) Payment for Additional Living Expense

will be for the shortest time required:

(a) To make that part of the “residence

premises” where you reside fit to live

in; or

(b) For your household to settle else-

where, if you permanently relocate.

This period of time applies even if it ex-

tends past the expiration date of this

policy.

We do not cover loss or expense due to cancellation

of a lease or agreement.

(3) This coverage does not increase the

Limit of Liability shown in the Schedule.

(4) Section I — Property Coverages, Cover-

age D — Loss Of Use in the policy form

does not apply to this endorsement.

4. Deductible

The deductible amount, equal to that which

applies to the peril of Fire, applies to loss,

damage or expense covered under this addi-

tional coverage. We will pay only that part of

the total of all loss, damage or expense. payable

under Paragraph 8.3. that exceeds that de-

ductible amount.

5. Loss, Damage Or Expense Not Covered We

will not pay:

ll4a

a. For any diminution or reduction in the mar-

ket value of any:

(1) “Covered real property”; or

(2) “Covered personal property”;

b. For any damage resulting from the loss of

or reduction in value of a pending sale of:

(1) “Covered real property”; or

(2) “Covered personal property”;

c. To replace any fuel;

d. For any expense to:

(1) Demolish or remove; or

(2) Repair, replace, rebuild or restore;

any part of a “fuel system”, other than

those expenses provided for in Paragraph

B.3.a. or b.; or

e. For any damage that results from an escape

from:

(1) One or more containers, tanks or ves-

sels, that are, or were, used to hold iiq-

uid fuel and are a part of a motor vehi-

cle, motorized land conveyance or

watercraft; or

(2) Related lines or parts, that are, or were,

connected to a motor vehicle, motorized

land conveyance or watercraft.

. For Form HO 00 03, under Section 1— Perils

Insured Against, Paragraph 2.e.(5) does not

apply to this Property Remediation For Es-

caped Liquid Fuel Coverage.

115a

7. When Special Computer Coverage Endorse-

ment is attached, Paragraph B.(3)(e) in that

endorsement, under Perils insured Against,

does not apply to this Property Rernediation

For Escaped Liquid Fuel Coverage.

8. For Form HO 00 03 when the Special Personal

Property Coverage Endorsement is attached,

Paragraph 1.b.(4)(e) in that endorsement, does

not apply to this Property Remediation For Es-

caped Liquid Fuel Coverage.

9. The Section I — Exclusions and Section 1 —

Additional Coverages apply to this Property

Remediation For Escaped Liquid Fuel Cov-

erage.

10.The Section 1— Conditions apply to this Prop-

erty Remediation For Escaped Liquid Fuel

Coverage except as provided in Paragraph C.

Section I — Conditions below.

11.This Property Remediation For Escaped Liquid

Fuel Coverage does not apply to any “residence

premises” at which the containers, tanks or

vessels, described in Paragraph A.11.a., have a

total combined storage capacity of less than

100 U.S. gallons of liquid fuel.

Coverage, if any, for escape of liquid fuel from

such containers, tanks or vessels is subject to

those;

a. Exclusions:

b Conditions;

c. Other provisions; and

d Limits of Liability;

116a

that apply to real and personal property under

the policy to which this endorsement is at-

tached.

C. Section 1 — Conditions — Property Remediation

For Escaped Fuel

With respect to loss, damage or expense described

in Paragraph B. Section I — Additional Cover-

ages, Section 1 Condition 7. Other Insurance, is

deleted and replaced by the following:

7. Other Insurance And Service Agreement

a. OtherInsurance _

If loss, damage or expense covered in pre-

ceding Paragraph B. is also covered by

other insurance, we will pay only the pro-

portion of the foss, damage or expense that

the limit of liability that applies under this

endorsement bears to the total amount of

insurance covering the loss, damage or ex-

pense.

b. Service Agreement

If loss, damage or expense covered in pre-

ceding Paragraph B. is also covered by a

service agreement, then this Property

Remediation for Escaped Liquid Fuel Cov-

erage is excess over any amounts payable

under any such agreement. Service Agree-

ment means a “fuel system” service plan,

property restoration protection plan, or

similar service or warranty agreement,

even if it is characterized as insurance.

D. Section II — Liability Coverages

117a

LIMITED LEAD AND ESCAPED LIQUID FUEL

LIABILITY COVERAGE

1. With respect to “bodily injury” or “property

damage” described In Paragraph D.2,, the cov-

erages provided by Section 0 — Liability Cov-

erages, Coverage E — Personal Liability and

Coverage F — Medical Payments To Others in

the policy form, and the Limits of Liability

stated on the Declarations page do not apply.

2. This coverage applies if a claim is made or a

suit is brought against an “insured” for dam-

ages because of:

a. “Bodily injury’ or “property damage” caused

by an “occurrence” involving the escape of

fuel from a “fuel system”. However, this

limited coverage does not apply to an “oc-

currence” of fire or explosion that results

from such escaped fuel. Damages resulting

from such an “occurrence” of fire or explo-

sion are subject to the Coverage E — Per-

sonal Liability limit of liability of the policy

to which this endorsement is attached;

b. “Bodily injury” caused by an *occurrence”

involving the absorption, ingestion or inha-

lation of lead which is in or on an Insured

location”; or

c. “Property damage” caused by an “occur-

rence” of lead contamination, but only if,

immediately prior to the ‘occurrence”, the

lead was located at an Insured location”.

NO OTHER LEAD OR ESCAPED LIQUID

FUEL LIABILITY COVERAGE APPLIES

118a

UNDER THIS POLICY EXCEPT AS PRO-

VIDED IN THIS PARAGRAPH.

. If coverage applies as stated in Paragraph

D.2., we will:

a. Pay up to the Aggregate Limit of Liability

stated in the Schedule for damages for

which an insured” is legally liable. Dam-

ages include prejudgment Interest awarded

against en “insured”; and

b. Provide a defense at our expense by counsel

of our choice even if the suit is groundless,

false or fraudulent. We may investigate and

settle any claim or stilt that we decide is

appropriate. Our duty to settle or defend

ends when the amount we pay for damages

resulting from “bodily injury” or “property

damage” described in Paragraph D.2. ex-

hausts the Aggregate Limit of Liability

stated in the Schedule.

. With respect only to applying the provisions of

this coverage as described in Paragraph 1)2.,

“bodily injury” or “property damage” caused in

whole or in part by an “occurrence” described

in Paragraph D.2. shall be deemed to have

been caused solely by such an “occurrence” re-

gardless of any other covered cause or event

contributing to the “bodily injury” or “property

damage”.

. The Section II — Additional Coverages in the

policy form apply with respect to this coverage

as described in Paragraph D. except as pro-

vided in Paragraph E. Section II — Additional

Coverages.

119a

6. The Section 11— Conditions in the policy form

apply with respect to this coverage as de-

scribed in Paragraph D. except as provided in

Paragraph F. Section 1I — Liability Con4i-

tions.

7. This coverage does not apply to an “insured lo-

cation” at which the containers, tanks or ves-

sels described in Paragraph Alta. have a total

combined storage capacity of less than 100

U.S. gallons of liquid fuel.

Coverage, if any, for an “occurrence” involving

the escape of liquid fuel from such containers,

tanks or vessels is subject to those:

a. Exclusions;

b. Conditions;

c. Other provisions; and

d. Limits of Liability;

that apply to Personal Liability and Medical

Payments To Others coverage in the policy to

which this endorsement is attached.

E. Section II — Additional Coverages

With respect to coverage described in Paragraph

D. Section II — liability Coverages, Additional

Coverage 4. Loss Assessment is deleted and re-

placed by the following:

4. Loss Assessment

a. We will pay up to the Aggregate Limit of Li-

ability stated in the Schedule for your share of

loss assessment charged during the policy pe-

riod against you by a corporation or association

120a

of property owners, when the assessment is

made as a result of:

(1) An “occurrence” involving the escape of fuel

from a “fuel system”;

(2) Sections I and II Conditions, Item 1. Policy

Period in this endorsement and in the pol-

icy form to which this endorsement is at-

tached.

F. Section 11- Liability Conditions

With respect to coverage described in Paragraph

D. Section U- Liability Coverages:

1. Conditions 4. - Duties Of An injured Person

Coverage F Medical Payments To Others and

5. - Payment Of Claim - Coverage F -Medical

Payments To Others are deleted; and

2. Conditions 1. - Limit Of Liability and 2. - Sev-

erability Of insurance in the policy form are

deleted and replaced by the following:

1. Aggregate Limit of Liability

Our total liability in any one policy period for

all damages resulting from the total of all “bod-

ily injury” or “property damage” during the

policy period will not be more than the Limited

Lead and Escaped Liquid Fuel Liability Cover-

age Aggregate Limit of Liability stated in the

Schedule. This is the most we will pay regard-

less of the:

2. Number of locations insured under the

policy to which this endorsement is at-

tached;

b. Number of persons injured;

12la

c. Number of persons whose property is

damaged;

d. Number of “insureds”; or e. Number of

claims made.

The “occurrence” limit of liability does not

apply to this coverage.

2. Severability Of Insurance

This insurance applies separately to each “in-

sured” except with respect to the Aggregate

Limit of Liability described in Paragraph F.2.1.

This condition will not increase the Limit for

this coverage.

G. Sections I and II - Conditions

Sections I and II - Conditions, item 1. Policy Pe-

riod is deleted with respect to the provisions of

this endorsement and replaced by the following:

1. Policy Period - Section II - Liability

This endorsement applies to “bodily injury” or

“property damage” described in Paragraph D.2.

All other provisions of the policy not specifically

modified by this endorsement apply.

LEXINGTON INSURANCE COMPANY

STANDARD POLICY CONDITIONS

THIS ENDORSEMENT CHANGES THE POLICY

PLEASE READ IT CAREFULLY

MINIMUM EARNED PREMIUM CLAUSE

In the event of cancellation of this policy by you,

the minimum premium listed on the Declaration

page shall become fully earned, any provision of the

policy to the contrary notwithstanding.

122a

Your failure to make timely payment of premium

shall be considered a request by you for us to cancel

on your behalf In the event of such cancellation for

non-payment of premium, the minimum. earned

premium shall be due and payable; provided, how-

ever, such cancellation shall be rescinded if you remit

and we receive the full policy premium within 10

days after the date of issuance of the cancellation no-

tice. Such remittance and acceptance by us shall not

alfect the minimum earned provision of this en-

dorsement. In the event of any other cancellation by

us, the earned premium shall be computed pro-rata,

not subject to the minimum earned premium.

SERVICE OF SUIT CLAUSE

Service of Suit - In the event of our failure to pay

any amount clammed to be due hereunder, we, at

your request, will submit to the jurisdiction of a court

of competent jurisdiction within the United States.

Nothing in this condition constitutes or should be

understood to constitute a waiver of our rights to

commence an action in any court of competent juris-

diction in the United States to remove an action to a

United States District Court or to seek a transfer of a

case to another court as permitted by the laws of the

United States or of any state in the United States, It

is further agreed that service of process in such suit

may be made upon Counsel, Legal Department, Lex-

ington Insurance Company, 200 State Street, Boston,

Massachusetts, 02109 or his or her representative,

and that in any suit instituted against us upon this

policy, we will abide by the final decision of such

court or of any appellate court in the event of an ap-

peal.

Further, pursuant to any statute of any state, terri-

tory, or district of the United States which makes

123a

provision therefor, we hereby designate the Superin-

tendent, Commissioner or Director of Insurance, or

other officer specified for that purpose in the statute,

or his or her successors in office as our true and law-

ful attorney upon whom may be served any lawful

process in any action, suit, or proceeding instituted

by you or on your behalf or any beneficiary hereunder

arising out of this policy of insurance and hereby des-

ignate the above named Counsel as the person to

whom the said officer is authorized to mail such proc-

ess or a true copy thereof.

AUTHORIZATION CLAUSE

IN WITNESS WHEREOF, we have caused this pol-

icy to be executed and attested, but this policy shall

not be valid unless signed on the Declaration page by

our duly authorized representative.

/s/ Elizabeth M. Tuck /s/ Ilegible

SECRETARY CHAIRMAN AND CEO

124a

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IMPORTANT FLOOD INSURANCE NOTICE

Your homeowners or dwelling policy does NOT

provide coverage for loss caused by flood or mudslide,

which is defined, in part, by the National Flood In-

surance Program as:

A general and temporary condition of partial or

complete inundation of normally dry land areas from

overflow of inland or tidal waters or from the unusual

and rapid accumulation or runoff of surface waters

‘from any source.

If you are required by your mortgage lender to

have flood insurance on your property, or if you feel

that your property is susceptible to flood damage, in-

surance covering damage from flood is available on

most buildings and contents in participating commu-

nities through the National Flood Insurance Pro-

gram.

Information about flood insurance and whether

your community participates in the program can be

obtained from your insurance company from your in-

surance agent/broker, or directly from the National

*lood Insurance Program by calling 1-800-638-6620.

If you purchase the maximum limits available

through the National Flood Insurance Program, and

require additional limits, contact your agent/broker

for information regarding the Lexington Insurance

Company’s Excess Flood Program.

125a

THIS ENDORSEMENT CHANGES THE POLICY

PLEASE READ IT CAREFULLY.

EXTERIOR INSULATION AND FINISH SYSTEM

EXCLUSION

THIS ENDORSEMENT IS ADDED TO YOUR

HOMEOWNERS POLICY AND APPLIES TO ALL

COVERAGES AND COVERAGE PARTS THAT

FORM PART OF THIS POLICY.

This coverage does not apply to any of the follow-

ing, regardless of any other cause or event that con-

tributes thereto, concurrently or in any sequence: .

1. “Bodily injury”, “property damage”, or any other

loss including but not limited to seepage,

&lamination, detachment, cracking, insect dam-

age, collapse or imminent collapse, caused directly

or indirectly, in whole or in part, by the design,

manufacture, construction, fabrication, prepara-

tion, installation, application, maintenance or re-

pair, including remodeling, service, correction, or

replacement, of an “exterior insulation and finish

system” or any part thereof, or any -substantially

similar system or any part thereof, including the

application or use of conditioners, primers, acces-

sories, flashings, coatings, caulking or sealant in

connection with such a system; or

2. Any moisture-related or dry rot-related. “property

damage” to an “inured location” or other building

to which an “exterior insulation and finish sys-

tem” has been applied, if that “property damage”

is caused directly or indirectly, in whole or in part,

by the “exterior insulation and finish system”;

For the purpose of this endorsement, an “exterior

insulation and finish system” means an exterior

126a

cladding or finish system applied to an “insured loca-

tion” or other building, and consisting of:

a) A rigid or semi-rigid insulation board made of

expanded polystyrene or other material; and

b) The adhesive and/or mechanical fasteners used

to attach the insulation board to the substrate;

and

c) A reinforcing mesh that is embedded in a base

coat applied to the insulation board; and

a) A finish coat providing surface texture and

Color. |

However, an “exterior insulation and finish sys-

tem” does not include a cement-based, enhanced

stucco cladding system which;

a) Incorporates a weather resistive building

wrap; and

b) Incorporates ribbed insulation board to provide

drainage.

Nothing in this exclusion is deemed to supersede

coverage provided by the Limited Mold Coverage Re-

lated endorsement (LEX 04 33 04 02); (LEX 00 25 11

01); (LEXELITE 00 25 02 03); (LEXELITE 00 25 04

02); (LEX DP 04 33 05 03).

All other terms, conditions and exclusions of the

policy remain unchanged.

127a

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HOMEOWNERS

LEX 01 09 03 G3

THIS ENDORSEMENT CHANGES THE POLICY.

PLEASE READ IT CAREFULLY

SPECIAL PROVISIONS

SECTION 1-- PROPERTY COVERAGES

COVERAGE B —Other Structures. The last para-

graph is deleted and replaced by the following:

The limit of liability for this coverage shall not

exceed the amount shown in the Declarations.

DEDUCTIBLE CLAUSE — is added as follows:

Unless otherwise noted in this policy, the fol-

lowing deductible provision applies:

Subject to the policy limits that apply, we will

pay only that part of the total of all losses pay-

able under Section I Property Coverages that

exceed the applicable deductible amount

shown in the Declarations, under no circum-

stance shall the applicable deductible be Tess

than the All Other Peril (AOP) deductible

listed on the Declarations.

SECTION I ADDITIONAL COVERAGES

11. Ordinance or Law is deleted and replaced on

Homeowners 4 — Contents Broad Form (HO 00

04 04 91) or Homeowners 8— Unit-Owners Form

(HO 00 06 04 91) as follows:

11. Ordinance or Law does not apply and no

coverage is provided.

128a

SECTION I PERILS INSURED AGAINST

COVERAGE A — DWELLING and COVERAGE

B — OTHER STRUCTURES

2.a. is deleted and replaced by. the following:

a. Freezing of a plumbing, heating, air condi-

tioning or automatic fire protective sprin-

kler system or of a household appliance, or

by discharge, leakage or overflow from

within the system or appliance caused by

freezing. This provision does not apply if

you have used reasonable care to:

(1) Maintain heat In the building; or

(2) Shutoff the water supply and drain all

systems and appliances of water,

However, if the building is protected by, an

automatic fire protective sprinkler system,

you must use reasonable care to continue

the water supply and maintain heat in the

building for coverage to apply.

SECTION 1— EXCLUSIONS

Paragraph 1.i. Act of Terrorism. is added;

i. Act of Terrorism. meaning an act, including

but not limited to the use of force or violence

and/or the threat thereof, of any person or

group(s)-of persons, whether acting alone or on

behalf of or in connection with any organization(s)

or government(s), committed for political, reli-

gious, ideological or similar purposes including

the Intention to influence any government and/or

to put the public, or any section of the public, in

fear.

129a

It is hereby understood and agreed, that notwith-

standing any provision to the contrary, it is

agreed that this policy. excludes, damage, cost or

expense of whatsoever nature directly or indi-

rectly caused by, resulting from or in connection

with biological, chemical, or nuclear pollution or

contamination arising out of any act of terrorism

regardless of any other cause or event contribut-

ing concurrently or in any other sequence to the

loss.

The policy else excludes damage, cost or expense o

whatsoever nature directly or indirectly caused

by, resulting from or in connection with any action

taken in controlling, preventing, or suppressing or

in any way relating to any biological, chemical, or

nuclear pollution or contamination arising out of

an act of terrorism.

Nothing in this exclusion shall be construed to ex-

clude loss, damage or cost or expense of whatso-

ever nature arising out of fire following any nu-

clear incident.

SECTION I - CONDITIONS

3.b. Loss Settlement- the following is added:

(6) if, at the time of loss, the building(s) under

Coverage A or B are being repaired, reno-

vated, rebuilt or under construction, the

amount of insurance be the proportion of

the value of the building that the actual

cash value of the building, on that date,

bears to the value when completed. You and

we agree that, for insurance purposes only,

the value-of the building is the amount

shown on the Declarations.

130a

SECTION II -EXCLUSIONS

Coverage E — Personal Liability and Coverage F

Medical Payments To Others

Paragraph 1.a is deleted and replaced by the fol-

lowing

a. Which is expected or which may reasona-

bly, be from the intentional acts or omis-

sions or criminal acts or omissions of one or

more “insured” persons. This exclusion ap-

plies even if the resulting “bodily injury” or

“property damage”

(1) is committed by an “insured” person(s)

lacking the mental capacity to govern

their own conduct;

(2) Is of a different kind, quality or degree

than initially expected or intended;

(3) Is sustained by, a different person, en-

tity, real or personal property, than ini-

tially expected or intended.

This provision applies regardless of an in-

sured” person(s) actually being charged

with, or convicted of a crime.

Paragraph 1.j. is deleted and replaced by the fol-

lowing:

Which arises out of the transmission of a

communicable disease by one or more “in-

sured”person(s) or by any other person for

whom the “insured” is legally responsible.

In addition, ‘We’ shall have no duty to de-

fend any claim or stilt seeking “bodily in-

jury’ or “properly damage”

Paragraph 1.m. is added: —_..

13la

m. Arising out of any claim of or indemnifica-

tion for punitive or exemplary damages. We

shall not have an obligation to pay for any

costs, interests or damages attributable to

punitive or exemplary dam ages.

SECTION I and II — CONDITIONS

2. Concealment or Fraud’s deleted and replaced b

the following:

2. We do not provide any coverage to one or

more “insureds” who, whether before or af-

ter a loss has:

(1) Intentionally concealed or misrepre-

sented real material fact or circum-

stance;

(2) Engaged in fraudulent conduct; or

(3) Made false statements

relating to coverage, we at our option may

choose to void the entire policy.

* *k *

5. Cancellation and 6. the following is added:

Regardless of another special provision and

or clauses to the contrary, these two sec-

tions are not modified by any other forms or

endorsements attached to this policy. This

policy is subject to the contract terms speci-

fied in Section 1 and II-Conditions, 5. Can-

cellation and 6. Nonrenewal. of the stan-

dard unendorsed Homeowners’ Form,

unless prohibited by applicable slate law.

If any provision of this endorsement is expressly pro-

hibited by applicable state law or applicable insur-

ance department regulation, that provision does not,

apply.

132a

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THIS ENDORSEMENT CHANGES THE POLICY

PLEASE READ IT CAREFULLY.

WINDSTORM OR HAIL PERCENTAGE DEDUCTI-

BLE ALL FORMS EXCEPT

HO 00 04 and HO 00 06

For the premium charged, we will pay only that

part of the total of the loss for all Section 1 Property

Coverages that exceeds the windstorm or hail per-

centage deductible stated in this endorsement. This

deductible applies in the event of direct physical loss

to property covered under this policy caused directly

or indirectly by windstorm or hail Such deductible

applies regardless of any other cause or event con-

tributing concurrently or in any sequence to the loss.

No other deductible provision in the policy applies to

direct physical loss caused by windstorm or hail.

In determining the amount, if any, that we wilt pay

for loss or damage, we will deduct an amount equal to

___%* of the limit of liability that applies to Coverage

A — Dwelling, in the policy to which this endorse-

rnent is attached, subject to a minimum $1,000 wind-

storm or hail deductible.

*Entries may be left blank if shown elsewhere in

this policy for this coverage. All other provisions of

this policy apply.

All other provisions of this policy apply.

133a

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HOMEOWNERS PROPERTY REMEDIATION FOR

ESCAPED LIQUID FUEL AND LIMITED LEAD

AND ESCAPED LIQUID FUEL LIABILITY COV-

ERAGES

ADVISORY NOTICE TO POLICYHOLDERS

This notice does not provide coverage nor does this

notice replace any provisions of your policy you

should read your policy and review your declarations

page for complete information on the coverages you

are provided with. If there is any conflict between the

policy and this notice, the provisions of the policy

shall prevail.

The policy you have just applied for or received has:

added coverage for damage to your property

caused by the escape of certain petroleum prod-

ucts that may be found in or on your home, your

residential unit in an apartment, condominium

or cooperative building, your household or per-

sonal property, other real property you own that

is covered in this policy and land on which your

home or unit or covered personal property is lo-

cated; and

reduced liability coverage for injury to another

person, or damage to the property of others, that

is caused by the escape of certain petroleum

products or by lead on or emanating from an in-

sured location such as your house, any other

premises where you are living but which you do

not own, or vacant land that you own.

ESCAPED FUEL REMEDIATION

If liquid fuel escapes flora a fuel storage system on

your property, kiss or damage caused by the escaped

134a

fuel to your home, personal property, any other one,

two, three or four family dwelling building you own

and insure for remediation coverage will

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