Personal Effects Form
April 6, 2015
Summary: The personal effects form is uniquely tailored to the traveling insured. The effects covered are those usually carried or worn by tourists and travelers while anywhere in the world. Special limits apply, and a number of items are specifically excluded. The ISO form PM 00 20 is specifically developed to provide coverage for this unique type of item.
Topics covered:
Introduction
Property covered
Property not covered
Perils
Deductible
Options
There are two types of schedules for this form; a schedule for effects for other than conventions or tours, and a schedule for conventions or tours. What is scheduled is not the property, but the name of the insured with a given dollar amount.
A. Property Covered
1. Personal Effects
We cover personal effects usually carried by tourists and travelers that an “insured” owns
and uses or wears while anywhere in the world.
2. Special Limits Of Liability
The limit for the following property is 10% of the amount of insurance that applies to personal effects:
a. Jewelry, watches and articles consisting in whole or in part of silver, gold or platinum; and
b. Furs or articles trimmed with or consisting principally of furs.
We will not pay more than $100 of this limit for any one item.
Analysis
The property covered in this form is what the insured has with him when traveling. This includes clothing, jewelry, cameras, sports equipment, luggage, and other such recreational items. Instead of listing items, the name of the insured is listed, so items with that person are what are covered. Special limits apply to jewelry and furs. The limit is ten percent of the overall coverage that applies to jewelry and furs, with a maximum limit of $100 per item. This is a very small limit, so if an insured travels with these items and wants reasonable coverage, he should look to the PM 00 11 Jewelry and Furs form. Jewelry is always a target for thieves, and some areas of the world are known for pickpockets and thieves who prey on tourists.
B. Property Not Covered
We do not cover:
1. Personal effects while:
a. At “your domicile”. “Your domicile” means your permanent residence to which, whenever absent, you intend to return:
b. In storage. However, we do cover such property at points and places en route during travel; or
c. In the custody of students while:
(1) In dormitories or fraternity or sorority houses; or
(2) On the premises of educational institutions.
However, we do cover such property for loss by the peril of fire.
2. Accounts, bills, currency, deeds, documents, evidences of debt, letters of credit, money, notes, securities, passports and transportation or other tickets;
3. Animals, artificial teeth or limbs and contact lenses;
4. Bicycles, hovercraft, motors, motor vehicles watercraft and other conveyances including their accessories, equipment and parts;
5. Household furniture;
6. Merchandise for sale or exhibition;
7. Physicians and surgeons instruments;
8. Salesperson's samples;
9. Theatrical property;
10. Contraband or property in the course of illegal transportation or trade; or
11. Any property specifically or otherwise insured.
Analysis
Property not covered is extensive. The first exclusion is for property at the insured's domicile, or residence. This is everything the insured owns other than what she is traveling with. Likewise, property in storage other than what is en route during the insured's travels is excluded as well. Items stored in a hotel safe would still be covered, as would property in storage on a cruise ship.
Property of students while at school, in the dorm, or in fraternity or sorority housing is excluded; this property is normally covered under the homeowners policy itself, and does not need to be covered in this form. However loss of property at school from fire is covered.
The remaining list of excluded items is self-explanatory; money is easily stolen or lost, as is merchandise for sale or exhibition, salesmen's samples or medical aids such as contact lenses or false teeth. Other items such as household furniture and motor vehicles are best insured on different policy forms.
C. Perils Insured Against
We insure against risk of direct physical loss to covered property.
We do not insure the following:
1. Loss caused by wear and tear, deterioration, inherent vice or any quality in property that causes it to damage or destroy itself;
2. Loss caused by insects or vermin;
3. Loss caused by or resulting from work done to or handling the property; or
4. Breakage of fragile articles unless caused by:
(a) An accident to a conveyance;
(b) A fire; or
(c) A thief.
Analysis
This is an open perils form, so only what is specifically excluded is not covered. Broad coverage is provided; and the standard wear and tear, deterioration, insects or vermin exclusions apply. Breakage of fragile items is excluded except for a fire, theft, or damage while the item is in a conveyance that sustains an accident. So if the insured purchases some figurines while on vacation and they are damaged while in a taxi, there is no coverage for those items. However, if while in transit the taxi is struck by another vehicle and the items are damaged, then there is coverage.
D. Deductible
We will pay only that part of the total of all loss payable under this policy that exceeds the deductible amount shown in the Declarations.
Analysis
The form has a standard deductible clause. A loss is not paid until it is over the amount of the deductible listed on the policy.
E. Options
One or more of the following options apply to this policy only if the box for that option is checked in the policy Declarations, or is otherwise indicated elsewhere in this policy.
1. Theft Exclusion
We will not cover loss to covered property caused by:
a. Theft or attempted theft;
b. Burglary, larceny or robbery;
c. Mysterious disappearance; or
d. Vandalism or malicious mischief.
2. Property At Your Domicile Coverage
Paragraph B.1.a. above, personal effects while at “your domicile”, is deleted.
Paragraph A. Property Covered above is deleted and replaced by the following:
A. Property Covered
1. Personal Effects
We cover personal effects usually carried by tourists and travelers that an “insured”
owns and uses or wears while anywhere in the world.
With regard to personal effects at “your domicile”, we will pay only that proportion
of any loss to such property that the amount of insurance bears to the actual cash value of all covered property at the time of loss. We will not include the value of the property outlined in 2. below when we make this calculation.
“Your domicile” means your permanent residence to which, whenever absent, you intend to return.
2. Special Limits Of Liability
The limit for the following property is 10% of the amount of insurance that applies to personal effects:
a. Jewelry, watches and articles consisting in whole or in part of silver, gold or platinum; and
b. Furs or articles trimmed with or consisting principally of furs.
We will not pay more than $100 of this limit for any one item.
Analysis
The form has a number of options that may be added to this form by indicating the selection on the declarations page or elsewhere in the policy. The first option is to exclude theft, burglary, larceny, robbery, mysterious disappearance, vandalism or malicious mischief. The insured may not intend to take valuables with them while traveling and would not need such coverage, and therefore could exclude such perils for a reduction in premium.
The second option is to allow coverage for property at the insured's domicile; coverage is settled at a percentage of all covered property at the time of loss. For example, the actual cash value of all covered property is $100,000. The insurance on the form is $70,000. The effects at the domicile that are damaged have an actual cash value of $15,000. The percentage is seventy percent. Therefore, seventy percent of the loss would be paid, or $10,500.00.
The special limits for jewelry, watches and articles consisting of gold, silver or platinum or articles consisting of or trimmed with fur remain the same. Those limits apply to property left at home as well that the property taken with the insured while traveling.
3. Students' Property Coverage
Paragraph B.1.c., which specifies that personal effects in the custody of students are not covered, is deleted.
4. Property In Trailer Home Coverage
a. We cover the furniture and furnishings owned or used by an “insured” contained in or used in connection with:
(1) An auto trailer home; or
(2) A trailer home;
owned or leased by an “insured”.
b. We will pay no more than the amount shown in the Declarations or elsewhere in
this policy for this Option for any one loss.
c. This coverage option does not apply to:
(1) Accessories, equipment and parts:
(a) Built into and forming a permanent part of the auto trailer home; and
(b) Usually attached to an automobile of the private passenger or truck type;
(2) Loss caused by marring, scratching, dampness of atmosphere or extremes of
temperature; or
(3) Loss caused by:
(a) Mechanical breakdown; or
(b) Damage to electrical apparatus caused by electricity whether artificial
or natural.
If direct loss by fire ensues, we will pay only for the ensuing loss.
Analysis
Option three removes the exclusion for the property of students at school or living offsite in fraternity or sorority houses.
Property in an auto trailer home or a trailer home that is owned or leased by an insured is covered. If the insured has an RV that he uses or some other type of trailer, property kept in the trailer is covered. The limit of coverage is what is shown in the declarations or elsewhere in the policy; the insured must select a limit for this coverage. Exclusions are for accessories, equipment and parts that are built into and are a permanent part of the trailer. Such items should be covered under the auto policy that covers the trailer. Items covered under this form would be clothing, dishes, utensils, and other household type items. Also excluded is marring, scratching, dampness or extremes of temperature and mechanical breakdown or damage to electrical apparatus. If a fire occurs as a result of the damage to electrical apparatus that fire is covered, but the electrical damage that occurred and which caused the fire is not covered.
5. Additional Person Insured Coverage
We agree that the additional person named in the Declarations or elsewhere in this policy for this Option is an “insured”.
You agree that such person is a permanent resident of “your domicile”.
F. Loss Conditions
In Common Policy Provisions Form PM 00 01, Paragraphs D.1.a.(2), D.1.b. and D.1.c. and D.2. are deleted.
Analysis
The final option allows the insured to add an additional person to the form as an insured. This is for significant others or those not related to the insured by blood or marriage, but who are permanent residents of the home.
The loss conditions are modified so that settlement is at the lesser of the actual cash value, the amount for which the item could be repaired or replaced, or the amount of insurance. The agreed value, blanket coverage, and loss clause language is removed. The removal of the loss clause is significant because that language keeps the limit of insurance intact unless there is a total loss of scheduled property. Without such language, for each loss, the remaining amount of insurance available for a loss is decreased.