CISR Personal Residential cheat sheet

Insurable interest must exist at the time of loss for property coverage; for life insurance it must exist at application.

Actual cash value (ACV) = replacement cost minus depreciation; replacement cost value (RCV) pays new-for-old without deduction for depreciation.

Coinsurance clauses in dwelling fire forms require limits at least 80% of replacement cost to avoid a penalty on partial losses.

A deductible is subtracted from each loss before payment; a separate wind/hail or hurricane deductible is often expressed as a percentage of the dwelling limit.

A mortgagee clause gives the lender rights to loss payment and notice independent of the insured's acts.

A coinsurance or insurance-to-value clause compares carried limit to required limit, then multiplies the loss by that ratio.

Vacancy means no occupants and no personal property; unoccupancy means furnishings remain but no people reside there.

A peril is a cause of loss; a hazard increases the chance of loss (physical, moral, morale).

Coverage A (Dwelling) covers the structure and attached structures; Coverage B (Other Structures) is typically 10% of Coverage A.

Coverage C (Personal Property) is usually 50-70% of Coverage A; Coverage D (Loss of Use) is typically 30% of Coverage A.

Special limits cap theft of money, jewelry, silverware, firearms, and securities; scheduled endorsements raise those limits.

Coverage A applies on a replacement cost basis; Coverage B and C commonly settle at ACV unless endorsed.

Named perils forms (e.g., HO-2, HO-3 personal property) pay only for listed perils; open perils (HO-3 dwelling, HO-5) pay for all risks except exclusions.

Coverage D pays additional living expense and fair rental value when the residence is uninhabitable due to a covered peril.

Standard exclusions include earth movement, flood, ordinance or law, intentional loss, neglect, and wear and tear.

Loss settlement for a total loss under a replacement cost policy is limited to the Coverage A limit shown on the declarations.

Coverage E (Personal Liability) pays sums the insured is legally obligated to pay for bodily injury or property damage; Coverage F (Medical Payments to Others) pays regardless of fault.

Coverage F typically pays medical expenses within 3 years of the accident, up to the stated limit per person, and excludes the named insured and regular residents.

Coverage E and F limits are separate; a single occurrence limit applies per accident, and Coverage E defense costs are paid in addition to the limit.

Section II excludes business activities, intentional acts, professional services, and injury to an insured's own household members in most forms.

Duties after loss include prompt notice, proof of loss, protection of property, and cooperation; failure can prejudice coverage.

The appraisal condition resolves disputes over the amount of loss, not coverage; each party selects an appraiser and an umpire decides.

Cancellation rules differ: short-rate for nonpayment or underwriting reasons, pro-rata for other cancellations, and notice periods vary by state.

A personal umbrella policy sits above homeowners and auto liability limits and usually requires underlying limits to be maintained.

The HO-3 covers the dwelling on an open perils basis and personal property on a named perils basis; the HO-5 covers both on an open perils basis.

HO-4 (renters) covers personal property and liability but not the building; HO-6 (condo) covers unit interior and improvements.

HO-8 (modified) settles losses on a functional replacement cost basis for older homes where RC exceeds market value.

A flood policy (NFIP) is separate; homeowners policies exclude surface water, waves, and mudslide.

Loss of use, debris removal, and trees/shrubs coverage are additional coverages with their own sublimits, not separate policies.

Endorsements modify coverage: scheduled personal property, water backup, replacement cost on contents, and business pursuits.

Personal injury coverage (libel, slander, invasion of privacy) is added by endorsement; standard Coverage E covers bodily injury and property damage only.

The declarations page states named insureds, policy period, limits, deductibles, and forms; it controls over conflicting policy language.