BT 3000 05 08 Personal Effects Coverage

BT 3000 05 08–PERSONAL EFFECTS COVERAGE

(July, 2018)

This optional form creates broader coverage under the boatowners policy by extending the policy’s Additional Property Coverages Section to include certain classes of non-boating, personal property.

PERSONAL EFFECTS COVERAGE

1. Property Covered

Personal effects, essentially, refers to privately owned property that is routinely worn or used as personal adornment. It can be owned by the named insured or by a guest. Examples of such items include (but are NOT limited to) the following:

Coverage applies only while such property is used in connection with covered boat property, including while loading or unloading the boating property.

 

Example: Josie is going out fishing with her friend, Kerri. She decides to take off her expensive jacket and:

Scenario 1: When jostled by Kerri’s sudden turn of the motorboat, Josie drops the jacket off the stern and it’s sucked into and shredded by the outboard motor. This loss would qualify for coverage.

Scenario 2: While approaching Kerri’s boat, Josie removes her expensive jacket and it is caught by the wind. The jacket is blown into the water and then is shredded by the motor of a passing boat. This loss would not qualify for coverage.

 

2. Property Not Covered

a. Items categorized as valuable property (jewelry, animals, furs, guns, currency, cameras, video equipment, etc.) are excluded from coverage.

b. No coverage exists for any property used in business activity: that is damaged or lost while an insured, for a fee, is transporting either persons or cargo; or while it is being rented or hired out to others.

c. Loss that is related to participation in races or stunts is also excluded. Ineligibility extends to loss that takes place during any practice, qualifications or other preparations for races or competitions.

Exception: This endorsement’s exclusion permits coverage for losses that occur during sailing competitions.

d. No coverage is granted for loss or damage to personal effects when the boating property is occupied as a primary residence. This exclusion also applies to boating property that, even when not a primary option, is permanently used as a residence. (Consider a boat that is permanently moored and is used as a seasonal or secondary residence.)

Note: The residential exclusion exists because residential use naturally means a much higher level of personal effects loss exposure.

3. Covered Losses

This form will respond to tangible loss to personal effects UNLESS the source of loss is specifically excluded (or limited) under this form.

4. Exclusions That Apply To Personal Effects Coverage

This endorsement does not respond to personal effects losses under the following situations:

a. The source of loss is excluded by the boatowner policy’s section on property exclusions.

b. The loss involves the disappearance of personal effects and there is no firm explanation for the disappearance. In other words, the loss can’t be pinned down to a firm place or time due to the lack of physical evidence.

 

Example: Harold files a claim for the loss of some custom boots, a vest and a watch. The claim is for $485. His insurer denies the claim when Harold admits that, while he knows that the property is gone, he can’t provide definitive information on when the property went missing or even whether it was from his boat or his home.

 

c. Theft losses which occur from unsecured locations are ineligible for coverage.

 

5. Limit

The limit that appears on the declarations is the maximum amount of coverage available for any single incident involving loss or damage to personal effects.

6. How Much We Pay

a. Losses are settled on an ACV basis, subject to the applicable limit that appears in the policy/declarations.

b. Coverage is subject to a $100 deductible except in cases where more than one deductible applies to the same covered property. In such instances, only the single, highest deductible will be applied.

c. The insurer’s response to a covered personal effects loss is altered when more than one source of coverage exists. If all the sources are provided by the insurance company, then only the single, highest coverage part limit applies. If another source or sources provides non-excess protection, then the insurer will respond on a pro-rata basis. However, this coverage will respond as primary protection when other available coverage exists, specifically, on an excess basis.

d. Coverage responds to lost or damaged property that is component based on that part’s value. There is no obligation to settle a loss based on the value of the entire, affected set.