Coverage under this endorsement applies on the "insured location" and off the "insured location", throughout the Coverage Territory. 

B. Coverage For Damage To Unmanned Aircraft 

1. We will pay for direct physical loss of or damage to the following Covered Property, caused by or resulting from a Covered Cause of Loss: 

"Unmanned aircraft" owned by you, or rented or leased to you if you have a contractual responsibility to insure, that are individually described or indicated as being insured on a blanket basis in the Schedule. However, if loss or damage occurs while such "unmanned aircraft" are in flight, in preparation for flight or being transported to or from the launch or landing site, coverage applies only if such use is part of "unmanned aircraft operations". 

Such "unmanned aircraft" includes equipment used exclusively with such "unmanned aircraft", provided such equipment is essential for operation of the "unmanned aircraft" or for executing "unmanned aircraft operations". 

2. Coverage for "unmanned aircraft" addressed in Paragraph B.1. includes the expense of removing the debris of such property as a result of loss or damage covered under the terms of this endorsement. 

3. "Unmanned aircraft" which are covered under this endorsement, as indicated in the Schedule, are not covered under Coverage C of the Farm Property – Farm Dwellings, Appurtenant Structures And Household Personal Property Coverage Form. 

Analysis

Coverage provided by this endorsement applies at the “insured location” and off the “insured location” as long as it is within the Coverage Territory.

Coverage is for physical loss or damage to the listed property from a Covered Cause of Loss. The covered property is “unmanned aircraft” owned, rented, or leased to the insured if the insured has a contractual responsibility to insure it, as long as the craft is listed on the schedule. If the damage occurs while the craft is in flight, preparing for flight, or being transported to or from the launch or landing site, coverage only applies if the use is part of the operations that have been listed in the schedule.

“Unmanned aircraft” includes equipment used exclusively with said craft as long as the equipment is essential to its operation or the execution of scheduled operations.

Included in the coverage is debris removal of such property as a result of loss or damage that is covered by the endorsement. If a scheduled drone is damaged while conducting scheduled operations, then coverage is provided for damage to the drone and cleanup of the debris.

The craft covered by this endorsement are not covered under Coverage C of the Farm Property - Farm Dwellings, Appurtenant Structures and Household Personal Property Coverage Form.

C. Coverage Extension For Newly Acquired Property Including Temporary Substitute Property (Applies To Scheduled Coverage Only) 

This Coverage Extension applies if so indicated in the Schedule. 

1. With respect to "unmanned aircraft" individually described in the Schedule, the coverage provided under this endorsement is extended to apply to similar "unmanned aircraft" which you acquire for use in your "unmanned aircraft operations" as additional property, replacement property or as a temporary substitute while an "unmanned aircraft" individually described in the Schedule is out of service due to breakdown, malfunction, repair work, servicing, damage or destruction.

  2. Insurance under this Coverage Extension for newly acquired property will end when any of the following first occurs: 

a. This Policy expires; 

b. 30 days expire after you acquire the property; or 

c. You report the acquisition to us. 

3. This Coverage Extension does not apply with respect to any "unmanned aircraft" or related property insured on a blanket basis. 

Analysis

Coverage C of this endorsement provides coverage for newly acquired property, including temporary substitutes. New drones similar to those already scheduled are covered when acquired for use in the scheduled operations, but only if they are additional or replacement property, or a temporary substitute while a particular craft is out of service due to breakdown, malfunction, repair work, servicing, damage, or destruction. This coverage ends at the earliest of the expiration date of the policy, thirty days after you acquire the property, or when the acquisition is reported to the insurer. This extension does not apply to “unmanned aircraft” or related property insured on a blanket basis. This provision only applies to craft that have been specifically and individually scheduled.

D. Covered Causes Of Loss, Exclusions And Limitations 

1. Coverage provided under this endorsement is subject to: 

a. The Special Covered Causes Of Loss and Exclusions as set forth in Paragraphs D. and E. of the Causes Of Loss Form – Farm Property; or 

b. The Covered Causes Of Loss as set forth in Paragraph A.3. and Exclusions as set forth in Paragraph B. of the Mobile Agricultural Machinery And Equipment Coverage Form; 

that are applicable with respect to "insured locations", except as otherwise provided in Paragraphs D.2. through D.7. 

2. Endorsements (if any) in this Policy that add a Covered Cause of Loss or modify the Causes of Loss (such as an exclusion of theft, terrorism, vandalism or windstorm or hail) also apply to the coverage provided under this endorsement. However, if the Equipment Breakdown Protection Coverage is endorsed to this Policy, it does not apply to the coverage provided under this endorsement. 

3. We will not provide coverage for loss or damage to "unmanned aircraft" when such loss or damage occurs while an "unmanned aircraft" is being used to convey merchandise or goods for delivery to others. 

4. We will not provide coverage when loss or damage to "unmanned aircraft" is caused by or results from "unmanned aircraft" being used in any professional or organized racing or demolition contest or stunting activity, or while practicing for such contest or activity. We also will not provide coverage while "unmanned aircraft" is being prepared for such contest or activity. 

5. We will not provide coverage for loss or damage that occurs while an "unmanned aircraft" is rented, leased or loaned to others. 

6. We will not provide coverage for loss or damage to "unmanned aircraft" caused by or resulting from mechanical breakdown, malfunction or failure to operate. But if mechanical breakdown, malfunction or failure to operate results in a Covered Cause of Loss, we will pay for the loss or damage caused by that Covered Cause of Loss. 

7. The following conditions, which are excluded causes of loss to certain property under the Causes Of Loss Form – Farm Property and the Mobile Agricultural Machinery And Equipment Coverage Form, are not excluded with respect to "unmanned aircraft" while being used in "unmanned aircraft operations", but coverage applies only if one or more of such conditions result in fire, explosion or collision: 

a. Dampness or dryness of atmosphere; 

b. Changes in or extremes of temperature; or 

c. Rain, snow, ice or sleet to property in the open, but if this Policy contains a Windstorm Or Hail Exclusion, then the terms of that exclusion apply.

Analysis

Section D outlines the covered causes of loss, exclusions, and limitations. The covered causes of loss are found in either the Causes of Loss form Farm Property or the Mobile Agricultural Machinery and Equipment Coverage Form, whichever form is applicable to the “insured locations,” except as otherwise provided in subsequent sections.

If there are endorsements that add covered causes of loss or modify the covered causes of loss, those provisions apply to this endorsement. However, if the Equipment Breakdown Protection Coverage is added to this policy, that endorsement does not apply to coverage under this endorsement.

Excluded is any loss or damage to “unmanned aircraft” if the damage occurs while the craft is being used to deliver goods or merchandise to others. Delivery itself is not covered. Likewise, professional or organized racing, stunting, demolition, or practicing or preparing for such activities is excluded. Also excluded is coverage to any craft that is rented, leased, or loaned to others. The craft must be in the insured's care, custody, or control for coverage to apply.

There is no coverage for loss or damage to a craft caused by mechanical breakdown, malfunction, or failure to operate. However, if a mechanical breakdown or failure results from a covered cause of loss, coverage will apply.

Certain exclusions that appear in the Causes of Loss Form Farm Property and the Mobile Agricultural Machinery and Equipment Coverage Forms are not excluded with respect to “unmanned aircraft” while being used in scheduled “unmanned aircraft operations.” Coverage applies only if one or more of the usually excluded conditions results in fire, explosion, or collision. Those conditions are dampness or dryness of atmosphere, changes in or extremes of temperature, or rain, snow, ice, or sleet to property in the open. If this policy contains a Windstorm or Hail Exclusion, the terms of that exclusion will apply.

E. Extra Expense

If a Limit Of Insurance is shown in the Declarations for Extra Expense Coverage, then the following applies with respect to "unmanned aircraft" shown in the Schedule: 

We will pay, up to that Limit of Insurance, the actual and necessary expenses you incur to resume normal farming operations interrupted as the result of direct physical loss of or damage to "unmanned aircraft" by a Covered Cause of Loss. 

Coverage for such extra expense is not limited by the expiration of this Policy. But, we will not pay extra expense you incur after the period required for repair or replacement of the "unmanned aircraft". 

F. Electronic Media And Records 

With respect to the coverage provided by this endorsement, we will pay for direct physical loss of or damage to "electronic media and records" caused by or resulting from a Covered Cause of Loss in the course of "unmanned aircraft" operations. The most we will pay in any one occurrence for loss or damage to "electronic media and records" is: 

1. $2,500; or 

2. The limit shown in the Schedule; 

whichever is greater. 

Analysis

Extra expense is an optional coverage that pays for actual and necessary expenses incurred to resume normal farming operations that were interrupted as the result of direct physical damage or loss to “unmanned aircraft” by a covered cause of loss. Coverage is not limited by the expiration of the policy, but it ceases once the period required for repair or replacement of the “unmanned aircraft” in question has ended. Therefore, if farming operations are suspended because of damage to a drone used in the farming operations, coverage is provided for expenses needed to resume normal operations.

Direct physical loss or damage to “electronic media and records” caused by or resulting from a covered cause of loss in the course of “unmanned aircraft” operations is covered. The most that is paid is the greater of $2,500 or the limit shown in the schedule.

G. Deductible 

The following is added with respect to the coverage provided under this endorsement: 

If a Deductible is shown in the Schedule, such Deductible applies to each occurrence of loss or damage to the property addressed in Paragraph B. of this endorsement. No other Deductible applies to such coverage. 

If an occurrence of a Covered Cause of Loss results in loss or damage to property covered under Paragraph B. of this endorsement and to other Covered Property that is subject to a Deductible, only the largest Deductible will apply. 

H. Limit Of Insurance 

1. Damage To Unmanned Aircraft – Scheduled Coverage 

The most we will pay in any one occurrence for the total of all covered loss or damage, including debris removal expense, to an "unmanned aircraft" individually described in the Schedule is the Scheduled Limit Of Insurance applicable to that "unmanned aircraft".

2. Damage To Unmanned Aircraft – Blanket Coverage 

The Blanket Limit Of Insurance shown in the Schedule is the most we will pay in any one occurrence for the total of all covered loss or damage, including debris removal expense, attributable to individually "unmanned aircraft" not described in the Schedule, regardless of the number of such "unmanned aircraft" lost or damaged. Subject to the Blanket Limit Of Insurance shown in the Schedule, the most we will pay for direct physical loss of or damage, including debris removal expense, to any one "unmanned aircraft" is the Per "Unmanned Aircraft" Sub-limit Of Insurance shown in the Schedule. 

3. Newly Acquired Property 

With respect to loss or damage to "unmanned aircraft" covered under the terms of the Coverage Extension in Paragraph C. of this endorsement: 

a. For an "unmanned aircraft" serving as the replacement or temporary substitute for an "unmanned aircraft" individually described in the Schedule, the Limit of Insurance is the same Scheduled Limit Of Insurance that applies to the original described in the Schedule; 

b. For an additional newly acquired "unmanned aircraft", the Limit of Insurance is the same Scheduled Limit Of Insurance as that which applies to the most similar "unmanned aircraft" individually described in the Schedule.

Analysis 

A deductible applies only if one is shown in the schedule. If a deductible is shown, it applies to each occurrence of loss or damage to the property listed in the endorsement. If a loss occurs to property covered by this endorsement and other property subject to a separate deductible, only the largest deductible will apply to the loss.

Under the scheduled coverage for property covered by this endorsement, the most that will be paid for any occurrence, including debris removal, for a scheduled craft is the scheduled limit that applies to that particular craft.

When property is covered on a blanket basis, the Per “Unmanned Aircraft” Sub-Limit of Insurance is the most that will be paid for any one craft, including debris removal expense, to craft that have not been individually scheduled on this endorsement. When more than one craft is damaged in an occurrence, the blanket limit is the maximum that will be paid for any one occurrence.

For craft serving as a replacement or temporary substitute for a drone individually scheduled on the form, the scheduled limit that applies to the original craft also applies to the replacement or temporary substitute. For newly acquired craft, the limit that applies is the one that applies to an already scheduled craft that is the most similar to the newly acquired craft.

I. Valuation 

With respect to the "unmanned aircraft" described in the above Schedule, the Valuation Loss Condition in the Farm Property – Farm Personal Property Coverage Form and Mobile Agricultural Machinery And Equipment Coverage Form is replaced by the following: 

Valuation 

1. Actual Cash Value 

If Actual Cash Value is selected in the Schedule, then in the event of loss of or damage to that covered "unmanned aircraft", we will settle covered losses at actual cash value as of the time of the loss, but we will not pay more than the amount necessary for repair or replacement.

2. Replacement Cost

a. If Replacement Cost is selected in the Schedule, then in the event of loss of or damage to that covered "unmanned aircraft", we will settle covered losses on the basis of replacement cost without deduction for depreciation. 

b. The Limit of Insurance for each scheduled "unmanned aircraft" must equal at least 80% of its full replacement cost as of the time of loss or damage. The most we will pay in any one occurrence is the least of: 

(1) The amount actually and necessarily spent to repair or replace that item; or 

(2) The Limit Of Insurance shown in the Declarations for that item. 

c. If the Limit of Insurance for any destroyed or damaged scheduled "unmanned aircraft" is less than 80% of its full replacement cost as of the time of loss, we will settle on the basis of Paragraph c.(1) or c.(2), whichever gives the higher amount: 

(1) The actual cash value, as of the time of loss, of that item; or 

(2) A proportion of the cost to repair or replace that item, without deduction for depreciation. This proportion will equal the ratio of the applicable Limit of Insurance to 80% of the cost of repairing or replacing that item. 

However, we will not pay more than the Limit of Insurance applicable to that item. 

d. If one Limit of Insurance applies to two or more separate items, this condition will apply to the total of all property to which the limit applies.

Analysis

The valuation clauses that appear in the Valuation Loss Condition in the Farm Property – Farm Personal Property Coverage Form and Mobile Agricultural Machinery And Equipment Coverage Form are replaced with the clauses in this endorsement. If actual cash value is shown in the schedule, losses are settled at actual cash value at the time of loss, with no more being paid than the amount necessary to repair or replace the property.

If the schedule lists replacement cost as the settlement option, covered losses are settled at replacement cost without any deduction for depreciation. The craft must be insured to at least 80 percent of its replacement value at the time of the loss. If the craft is properly insured, the most that is paid is the least of the amount actually spent to repair or replace the item, or the limit of insurance shown in the declarations.

If the limit of insurance of a covered craft is below 80 percent of the full replacement cost at the time of loss, coverage is the higher of either the actual cash value at the time of loss or a proportion of the cost to repair or replace, without deduction for depreciation. The proportion is the ratio of the applicable limit of insurance to 80 percent of the cost of repairing or replacing the item. No more than the limit applicable to the item will ever be paid. For example, a drone is valued at $7,000. It is insured for $4,200, which is 60 percent of the replacement cost value; the drone should have been insured for at least 80 percent, which is $5,600. Therefore, the calculation is $4,200 divided by $5,600, which equals .75. Seventy-five percent of $4,200 equals $3,150, which is what is paid in the event of a loss.

If one limit of insurance applies to two or more separate items, this condition applies to the total of all property to which the limit applies. If multiple craft are damaged by a covered cause of loss, the valuation parameters apply to all damaged property.

J. Definitions 

The following definitions are added and replace any corresponding definitions or descriptions in the Coverage Form, but only with respect to the coverage provided under this endorsement: 

1. "Electronic media and records" means:

a. Programmable electronic equipment (hardware) that is used to store, retrieve and process data; and

b. Associated peripheral equipment that provides communication, including input and output functions such as printing, or auxiliary functions such as data transmission. 

2. "Unmanned aircraft" means an aircraft that is not: 

a. Designed;

b. Manufactured; or

c. Modified after manufacture; to be controlled directly by a person from within or on the aircraft. 

3. "Unmanned aircraft operations" means the operations described in the Schedule.

Analysis

Three definitions are added and are applicable to the coverage provided in this form. The first is “electronic media and records,” which means programmable electronic equipment (hardware) that is used to store, retrieve, and process data and associated peripheral equipment that provides communication, including input and output functions such as printing, or auxiliary functions such as data transmissions. The equipment must be hardware that processes, stores, and receives data, as well as communicates such that printing and data transmission can occur.

“Unmanned aircraft” are defined as aircraft that are not designed, manufactured, or modified after manufacture to be controlled by a person from within or on the aircraft. These are vehicles that a person cannot pilot from either within the vehicle or while on the vehicle. The craft must be remote controlled in some way.

“Unmanned aircraft operations” are the operations described in the schedule. As there are a wide variety of farm operations where drones could be used, it is impossible to provide a detailed definition of such operations.

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