Loss Assessment Coverage 

We will pay your share of any loss assessment charged during the policy period against you by a corporation or association of property owners, up to the Limit Of Liability shown in the Schedule above for each unit. The assessment must be made as a result of direct loss to property, owned by all members collectively, of the type that would be covered by this Policy if owned by you, caused by: 

1. Earthquake; or 
2. Land shock waves or tremors before, during or after a volcanic eruption. 
One or more earthquake shocks that occur within a 72-hour period constitute a single earthquake. 

B. Section I – Exclusions 

1.      The following exclusions are added: 

a. We do not cover assessments charged against you or a corporation or  association of property owners by any governmental body. 
b. We do not cover any assessment made as a result of loss resulting directly or indirectly from flood of any nature or waves, including tidal wave and  tsunami, whether: 

(1) Caused by; 
(2) Resulting from; 
(3) Contributed to by; or 
(4) Aggravated by; 
earthquake. 

2. Exception To The Earth Movement Exclusion 

The Section I – Earth Movement Exclusion does not apply to loss caused by earthquake, including land shock waves or tremors before, during or after a volcanic eruption. 
 
Analysis 

This is very similar to the HO 04 54, except that coverage is for any share of loss assessment charged to the insured by a corporation or association of property owners for damage to property shown in the schedule if damage occurs to property owned by all members of the association collectively. Many areas have clubhouses, swimming pools, or workout rooms that any resident in the community can use. These properties are owned collectively by the residents.  

The damage must be caused by an earthquake or land shock waves or tremors before, during or after a volcanic eruption. An earthquake includes all shocks within a 72-hour period as one earthquake.  

An exclusion exists for any assessments charged against the insured or an association or corporation of property owners that is levied by a governmental body.  

This form repeats the exclusion found in the HO 04 54 for damage from flood, waves, tidal waves, or tsunami, caused by, resulting from, contributed to by, or aggravated by, an earthquake. It then makes it clear that this endorsement removes the Earth Movement Exclusion from the policy so that this coverage will apply.  

C. Section I – Conditions 

B. Deductible 
The following replaces any other deductible provision in this Policy with respect to any one loss covered under this endorsement. 
The following deductible applies to your share of each assessment made for each loss caused by earthquake: 

For each unit covered, we will pay only that part of your assessment which is more than the earthquake loss assessment deductible shown in the Schedule of this endorsement. If a dollar amount is not shown in the Schedule for the earthquake deductible, the dollar amount is determined by multiplying the limit of liability for each unit shown in the Schedule by the deductible percentage amount shown in the Schedule. 

However, this deductible amount will not be less than $500 in any one assessment. We will apply only one deductible, per unit, to the total amount of any one loss to the property described in this endorsement, regardless of the number of assessments. 

All other provisions of this Policy apply. 

Analysis 

A deductible applies to the insured's share of each loss assessment due to damage caused by an earthquake. Only that part of the insured's assessment that is above the deductible listed in the schedule is covered. If a dollar amount is not listed, then the amount is determined by multiplying the limit for each unit shown in the schedule by the deductible percentage shown in the schedule.  

As always, all other provisions of the policy will apply. This ensures that this endorsement only modifies what is specifically addressed in the form.  

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