business, if loss results from theft, except as provided in any applicable Supplemental Coverages. This exclusion shall not apply to jewelry and watches worth $100 or less per item;

 

A.        The Limits of Insurance for the following Supplemental Coverages are in ADDITION to the Limits of Insurance for Covered Property indicated in the Declarations.

 

1.         Debris Removal

 

We shall pay an additional Limit of Insurance for debris removal as shown on the Declarations:

 

a.                   If the cost for debris removal exceeds the amount stipulated in Section IX Loss Conditions, paragraph G. Debris Removal; or

 

b.                   If the cost for debris removal and direct physical loss of or damage to Covered Property exceeds the applicable Limit of Insurance for the Covered Property;

This Coverage shall not apply to costs to:

 

a.                   Extract pollutants from land or water; or

 

b.                  Remove, restore, or replace land or water as a result of pollutants.

 

2.         Fire Department Service Charge

 

If the fire department is called to save or protect Covered Property from a covered cause of loss, we shall pay for your liability for fire department service charges:

 

a.                   Assumed by contract or agreement prior to loss; or

 

b.                   Required by local ordinance

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  3.       Pollutant Clean Up And Removal

 

We shall pay your expense to extract pollutants from Covered Property, land, or water at the premises described in the Declarations if the discharge, dispersal, seepage, migration, release, or escape of the pollutants commences during the Policy Period and is caused by or results from a covered cause of loss. The expenses shall be paid only if they are reported to us in writing within 180 days of the date of direct physical loss or damage.

 

  4.       Recharge Of Fire Protection Equipment

 

We shall pay expenses you incur to recharge your fire protection equipment, if you use your equipment, or the equipment automatically discharges, to protect your Covered Property as a result of a covered cause of loss.

 

  5.       Extra Expense

 

We shall pay for extra expense to:

 

a.         Avoid or minimize the suspension of business and to continue operations:

 

i.                     At the premises described in the Declarations;

 

ii.                   At replacement premises or at temporary locations, including:

 

(a)                Relocation expenses;

 

(b)                Costs to equip and operate the replacement or temporary locations;

 

(c)                Minimize the suspension of business if you cannot continue operations; or

 

b.        Research, replace, or restore the lost information on damaged valuable papers and records;

 

To the extent it reduces the amount of loss that otherwise would have been payable under this Policy.

 

  6.       Deferred Payments

 

We shall pay for your deferred payments for direct physical loss of or damage to Covered Property by a covered cause of loss.

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7.           Inventory And Appraisal

 

We shall pay up to the amount indicated in the Declarations for your costs related to inventory and appraisal which we require when loss or damage occurs to Covered Property.

 

B.       The Limits of Insurance for the following Supplemental Coverages are WITHIN the Limits of Insurance for Covered Property indicated in the Declarations:

 

1.          Theft Of Furs, Jewelry, Stamps, And Other Specified Items

 

a.         We shall pay for loss or damage by theft for:

 

i.                     Furs, fur garments, and garments trimmed with fur;

 

ii.                   Jewelry, watches, watch movements, jewels, pearls, precious and semi-precious stones, bullion, gold, silver, platinum, and other precious alloys or metals; and

 

iii.                  Stamps, tickets, and letters of credit if such items are for sale, trade, or show, as part of your business.

 

2.          Off Premises Utility Failure

 

We shall pay for loss of or damage to your Covered Property caused by the interruption of service to the premises described in the Declarations which results from direct physical loss of or damage by a covered cause of loss to the following services not on the premises described in the Declarations:

 

a.        Water Supply Services, meaning the following types of property supplying water to the premises described in the Declarations:

 

i.                     Pumping stations; and

 

ii.                   Water mains.

 

b. Communication Supply Services, meaning property supplying communications services, including, but not limited to, telephone, radio, microwave, or television services to the premises described in the Declarations, such as:

 

i.                     Communication transmission lines;

 

ii.                   Coaxial cables; and

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iii.          Microwave radio relays except satellites.

 

This shall not include above ground communication lines.

 

C.                  Power Supply Services, meaning the following types of property supplying electricity, steam, or gas to the premises described in the Declarations:

 

i.                     Utility generating plants;

 

ii.                   Switching stations;

 

iii.                  Substations;

 

iv.                 Transformers; and

 

V.                      Transmission lines.

 

This shall not include above ground transmission or distribution lines. 3.      Equipment Breakdown

a.                   We will pay for direct physical damage to Covered Property that is the direct result of an accident.

 

b.                  The following coverages also apply to the direct result of an accident.

 

Expediting Expenses

With respect to your damaged Covered Property, we will pay up to the limit indicated in the Declarations for the reasonable extra cost to:

(1)           make temporary repairs; and

(2)           expedite permanent repairs or permanent replacement.

 

ii. Hazardous Substances

We will pay for the additional cost to repair or replace Covered Property because of contamination by a hazardous substance. This includes the additional expenses to clean up or dispose of such property.

This does not include contamination of perishable goods by refrigerant, including but not limited to ammonia, which is addressed in 3.b.iii.(1)(b) below. As used in this coverage, additional costs mean those beyond what would have been payable under this coverage had no hazardous substance been involved.

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The most we will pay for loss, damage or expense under this coverage, including actual loss of Business Income you sustain and necessary Extra Expense you incur, if shown as covered, is the limit indicated in the Declarations.

 

iii. Spoilage

(1) We will pay:

(a)        for physical damage to perishable goods due to spoilage;

(b)        for physical damage to perishable goods due to contamination from

the release of refrigerant, including but not lunited to ammonia;

(c)        any necessary expenses you incur to reduce the amount of loss under

this coverage to the extent that they do not exceed the amount of loss

that otherwise would have been payable under this coverage.

(2) If you are unable to replace the perishable goods before its anticipated sale, the amount of our payment will be determined on the basis of the sales price of the perishable goods at the time of the accident, less discounts and expenses you otherwise would have had. Otherwise our payment will be determined in accordance with the Valuation condition.

The most we will pay for loss, damage or expense under this coverage is the limit indicated in the Declarations.

 

iv. Computer Equipment

We will pay for loss, damage or expense calked by or resulting from an accident to computer equipment.

The most we will pay for loss, damage or expense under this coverage, including actual loss of Business Income you sustain and necessary Extra Expense you incur, if shown as covered, is the limit indicated in the Declarations. Computers used primarily to control or operate covered equipment are not subject to this limit.

 

v. Data Restoration

We will pay for your reasonable and necessary cost to -research, replace and restore lost data.

The most we will pay for loss, damage or expense under this coverage, including actual loss of Business Income you sustain and necessary Extra Expense you incur, if shown as covered, is the limit indicated in the Declarations.

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vi. Service Interruption

(1)         Any insurance provided for Business Income, Extra Expense or Spoilage is extended to apply to your loss, damage or expense caused by an accident to equipment that is owned by a utility, landlord or other supplier with whom you have a contract to supply you with any of the following services: electrical power, waste disposal, air conditioning, refrigeration, heating, natural gas, compressed air, water, steam, internet access, telecommunications services, wide area networks or data transmission. The equipment must meet the definition of covered equipment except that it is not Covered Property.

(2)        Unless otherwise shown in the Declarations, Service Interruption coverage will not apply unless the failure or disruption of service exceeds 24 hours immediately following the accident.

(3)         The most we will pay for loss, damage or expense under this coverage is the limit that applies to Business Income, Extra Expense or Spoilage, except that if a limit is shown in the Declarations for Service Interruption, that limit will apply to Business Income and Extra Expense loss under this coverage.

 

vii. Business Income and Extra Expense

Any insurance provided under this coverage part for Business Income or Extra Expense is extended to Equipment Breakdown coverage.

The most we will pay for loss of Business Income you sustain or necessary Extra Expense you incur is the limit shown in the Declarations for that coverage.

 

c.         We will not pay under this coverage for loss, damage or expense caused by or resulting from:

i.                         your failure to use all reasonable means to protect Covered Property from damage following an accident;

ii.                        any defect, programming error, programming limitation, computer virus, malicious code, loss of data, loss of access, loss of use, loss of functionality or other condition Within or involving data or media of any kind. But if an accident results, we will pay for the resulting loss, damage or expense; or

iii.                       any of the following tests:

a hydrostatic, pneumatic or gas pressure test of any boiler or pressure vessel, or an electrical insulation breakdown test of any type of electrical equipment.

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d.                   With respect to Service Interruption coverage, we will also not pay for an accident caused by or resulting from: fire; lightning; windstorm or hail; explosion (except for explosion of steam boilers, steam pipes, steam engines or steam turbines); smoke; aircraft or vehicles; riot or civil commotion; vandalism; sprinkler leakage; falling objects; weight of snow, ice or sleet; freezing; collapse; flood or earth movement.

 

e.                   With respect to Business Income, Extra Expense and Service Interruption coverages, we will also not pay for:

i.           loss caused by your failure to use due diligence and dispatch and all reasonable means to resume business; or

ii.          any increase in loss resulting from an agreement between you and your customer or supplier.

 

f           We will not pay under this coverage for any loss or damage to animals.

 

g.          The following conditions are added:

i. Suspension

Whenever covered equipment is found to be in, or exposed to a dangerous condition, any of our representatives may immediately suspend the insurance against loss from an accident to that covered equipment. This can be done by mailing or delivering a written notice of suspension to:

(1)    your last known address; or

(2)    the address where the covered equipment is located.

Once suspended m this way, your insurance can be reinstated only by an endorsement for the covered equipment. If we suspend your insurance, you will get a pro rata refund of premium for that covered equipment for the period of suspension. But the suspension will be effective even if we have not yet made or offered a refund.

 

ii. Jurisdictional Inspections

If any property that is covered equipment under this coverage requires inspection to comply with state or municipal boiler and pressure vessel regulations, we agree to perform such inspection on your behalf. We do not warrant that conditions are safe or healthful.

 

iii. Environmental; Safety and Efficiency Improvements

If covered equipment requires replacement due to an accident, we will pay your additional cost to replace with equipment that is better for the environment, safer or more efficient than the equipment being replaced. However, we will not pay more than 125% of what the cost would have been to repair or replace with like kind and quality. This condition does not increase any of the applicable limits. This condition does not apply to any property to which actual cash value applies.

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4. Reward Payments

In the event of covered loss or damage as a result of arson, theft or vandalism, we will pay for amounts you offer, and subsequently pay, as a reward to anyone other than you, your officers, partners, directors, employees, or any family member(s) of such individuals, or any employee of a law enforcement agency or any employee of a business engaged in property protection, or any person(s) involved in the crime, as a reward for information leading to:

a.               the arrest and conviction of any person(s) responsible for the arson, theft or vandalism loss; or

b.             the recovery of the stolen property. SECTION VIII. DEDUCTIBLE shall not apply to this Supplementary Coverage. 5.     Data and Programs - extended covered cause of loss

Covered cause of loss is extended to include a virus, harmful code or similar instruction introduced into or enacted on a computer system (including electronic data) or a network to which it is connected, designed to damage or destroy any part of the system or disrupt its normal operation. But there is no coverage for loss or damage caused by or resulting from manipulation of a computer system (including electronic data) by any employee, including a temporary or leased employee, or by an entity retained by you or for you to inspect, design, install, modify, maintain, repair or replace that system.

The most we will pay under this extended covered cause of loss for all loss or damage to Data and Proms s sustained in any one policy year, regardless of the number of occurrences of loss ~or damage or the number of premises, locations or computer systems involved is the liunit indicated in the Declarations. If loss payment on the first occurrence does not exhaust this amount, then the balance is available for subsequent loss or damage sustained in but not after that policy year. With respect to an occurrence which begins in one policy year and continues or results in additional loss or damage in a subsequent policy year(s), all loss or damage is deemed to be sustained ii the policy year in which the occurrence began.

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6.          Limited Coverage For Fungus, Wet Rot, Dry Rot And Bacteria

a. This Supplemental Coverage only applies when the fungus, wet or dry rot or bacteria is the result of a specified cause of loss other than fire or lightniung that occurs during the policy period and only if all reasonable means were used to save and preserve the property from further damage at the time of and after that occurrence.

b. We shall pay for loss or damage by fungus, wet or dry rot or bacteria. As used in this Limited Coverage, the term loss or damage means:

i.      direct physical loss or damage to Covered Property caused by fungus, wet or dry rot or bacteria, including the cost of removal of the fungus, wet or dry rot or bacteria;

ii.     the cost to tear out and replace any part of the builduig or other property as needed to gain access to the fungus, wet or dry rot or bacteria; and

iii.the cost of testing performed after removal, repair, replacement or restoration of the damaged property is completed, provided there is a reason to believe that fungus, wet or dry rot or bacteria are present.

c. the most we will pay under this Limited Coverage in any one policy year, regardless of the number of claims, is the limit indicated in the Declarations.

With respect to a particular occurrence of loss which results in fungus, wet or dry rot or bacteria, we will not pay more than the limit indicated in the Declarations even if the fungus, wet or dry rot or bacteria continues to be present or active, or recurs, in a later policy period.

 

 

V. OPTIONAL COVERAGE

If shown in the Declarations, the following Optional Coverage shall apply. A.        Agreed Value

The Loss Condition, Coinsurance does not apply to Covered Property to which this Optional Coverage applies. We will pay no more for loss of or damage to that property than the proportion that the Limit of Insurance under the Coverage Form for the property bears to the Agreed Value shown for it in the Declarations.

2. If the expiration date for this Optional Coverage shown in the Declarations is not extended, the Loss Condition., Coinsurance, is reinstated and this Optional Coverage expires.

The terms of the Optional Coverage apply only to loss or damage that occurs:

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a.         On or after the effective date of this Optional Coverage; and

b.         Before the Agreed Value expiration date shown in the Declarations, or the policy expiration date, whichever occurs first.

A.                 Any loss or damage condition, including but not limited to, pollutants, earth movement, or flood, which existed prior to the Effective Date;

 

B.                 Delay, loss of use, or loss of market;

 

C.                 Smog, smoke, vapor, or gas from agricultural smudging or industrial operations;

 

D.                 Wear and tear_;

 

But if loss or damage by a specified cause of loss or an accident results, we shall pay for the resulting damage caused by such specified cause of loss or accident;

 

This exclusion, however, does not apply to any resulting loss or damage caused by elevator collision.

 

E.                  Rust, corrosion, decay, deterioration, hidden, or latent defect or any quality in Covered Property that causes it to damage or destroy itself.

 

But if an accident results, we shall pay for the resulting loss, damage or expense caused by such accident;

 

F.                  Settling, cracking, shrinking, expansion, or decomposition of building material which is integral to the structure;

 

But if loss or damage by a specified cause of loss or an accident results, we shall pay for the resulting loss or damage caused by such specified cause of loss or accident;

 

G.                 Insects, birds, rodents, or other animals;

 

But if loss or damage by a specified cause of loss or an accident results, we shall pay for the resulting damage caused by such specified cause of loss or accident;

 

H.                 Rain, snow, ice, or sleet to business personal property in the open;

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I. Any dishonest or criminal act by you, any of your partners, employees, directors, trustees, authorized representatives or anyone to whom you entrust the Covered Property for any purposes:

 

1.                    Acting alone or in collusion with others; or

 

2.                    Whether or not occurring during the hours of employment. This exclusion shall not apply to acts of destruction by your employees;

 

J. Covered Property that is missing, where the only evidence of the loss or damage is a shortage disclosed on taking inventory, or other instances where there is no physical evidence to show what happened to the Covered Property;

 

     K. 1.       Acts or decisions, including the failure to act or decide, of any person, group, organization or governmental body; or

 

         2.        Faulty, inadequate, or defective:                                       ,

 

a.                   Planning, zoning, development, surveying, or siting;

 

b.                   Design, specifications, workmanship, repair, construction, renovation, remodeling, grading, compaction;

 

C.                    Material used in repair, construction, renovation, or remodeling; or

 

d.         Maintenance;

 

of part or all of any Covered Property on or off the premises described in the Declarations;

 

But if loss or damage by a specified cause of loss results, we shall pay for the resulting damage caused by such specified cause of loss;

 

L. Seizure or destruction of Covered Property by order of goverriznental authority;

 

But we shall pay for acts of destruction ordered by governmental authority and taken at the time of a fire to prevent its spread, if the fire would be covered under this Policy;

 

M. Damage or loss to the interior of any building or structure caused by or resulting from rain, snow, sleet, ice, sand or dust, whether driven by wind or not, unless:

 

1. The building or structure first sustains damage by a covered cause of loss to its roof or walls through which the rain, snow, sleet, ice, sand or dust enters; or

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2.         The loss or damage is caused by or results from thawing of snow, sleet, or ice on the building or structure;

 

N. 1.            War, including undeclared or civil war;

 

2.                     Warlike action by a military force. Including action in hindering or defending against an actual or expected attack, by any govermnent, sovereign or other authority using military personnel or other agents; or

 

3.                     Insurrection, rebellion, revolution, usurped power, or action taken by governmental authority in hindering or defending against any of these;

 

0. Nuclear reaction or radiation or radioactive contamination, however caused. But if loss or damage by fire results, we shall pay for that resulting loss or damage;

 

P.                  Discharge, dispersal, seepage, migration release or escape of pollutants unless the discharge, dispersal, seepage, migration, release or escape is itself caused by any specified cause of loss.

 

But if loss or damage by a specified cause of loss results, we shall pay for the resulting damage caused by such specified cause of loss;

 

Q.                 Damage or loss to Covered Property that has been transferred to a person or to a place        outside the

premises described in the Declarations on the basis of unauthorized                instructions;

 

R.                 Flood;

 

But if loss or damage by a specified cause of loss results, we shall pay for the resulting damage caused by such specified cause of loss, or if electrical covered equipment requires drying out because of Flood, we will pay for the direct expenses of such drying out subject to the applicable Limit of Insurance and deductible indicated in the Declarations;

 

S.                  ]Earth Movement;

 

But if loss or damage by a specified cause of loss results, we shall pay for the resulting damage caused by such specified cause of loss;

 

T.                  the presence, growth, proliferation, spread or any activity of "fungus", wet or dry rot or bacteria. But if "fungus", wet or dry rot or bacteria results in a "specified cause of loss", we will pay for the loss or damage caused by that "specified cause of loss".

This exclusion does not apply:

1.         when "fungus", wet or dry rotor bacteria results from fire or lightning; or

2.         to the extent that coverage is provided in the Supplemental Coverages B. 5. Limited Coverage For "Fungus", Wet Rot, Dry Rot And Bacteria with respect to loss or damage by a specified cause of

loss other than fire or lightning.

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VII. LIMITS OF INSURANCE

The Limits of Insurance shown in the Declarations are the most we shall pay, in any one occurrence, regardless of the number of:

 

Insureds;

 

2.                   Claims made or suits brought; or

 

3.                   Persons or organizations making claims or bringing suits.

VIII. DEDUCTIBLE

Unless otherwise specified, the following shall apply to all coverages:

 

A.                 We shall not pay for loss or damage in any one occurrence, or any one accident, until the amount of loss or damage exceeds the applicable Deductible shown in the Declarations. We shall then pay the amount of loss or damage in excess of the Deductible, up to the applicable Linlit of Insurance.

 

B.                 If more than one deductible applies to Covered Property, as a result of one occurrence, you shall pay the highest applicable deductible; except

 

C.                 As respects Equipment Breakdown:

 

1.       The deductible for Buildings and Business Personal Property apply unless a separate Equipment Breakdown deductible is indicated in the Declarations. However, if deductibles vary by type of covered equipment and more than one type of covered equipment is involved in any one accident, only the highest deductible for each coverage will apply.

2.       If a deductible is expressed as a percentage of loss, we will not be liable for the indicated percentage of the gross amount of loss, damage or expense (prior to any applicable deductible or coinsurance) insured under the applicable coverage. If the dollar amount of such percentage is less than the indicated minimum deductible, such minimum deductible will be the applicable deductible.

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In the event of loss or damage to Covered Property, you shall: I.  Notify the police if a law may have been broken;

 

2.                   In the event of theft, provide us with a police report or a report which was submitted to the appropriate civil authorities;

 

3.                   Give us prompt notice of the loss or damage and include a description of the Covered Property involved;

 

4.                   As soon as possible, give us a description of how, when, and where the loss or damage occurred;

 

5.                   Take all reasonable steps to protect the Covered Property from further damage. If feasible, set

the damaged Covered Property aside and in the best possible order for examination. You shall

also keep a record of your expenses for emergency and temporary repairs, for consideration

in the settlement of the claim;

 

6.                   At our request, give us complete inventories of the damaged and undamaged Covered Property. Include quantities, costs, values, and amount of loss claimed;

 

7.                   Permit us to inspect the Covered Property and records proving the loss or damage and take samples of Covered Property for inspections, testing, and analysis;

 

8.                   If requested, peit us to question you under oath at such times as may be reasonably required about any matter relating to this insurance or your claim, including your books and records. In such event, your answers shall be signed;

 

9.                   Send us a signed, sworn proof of loss containing the information we request to investigate the claim. You shall do this within sixty (60) days after our request. We shall supply you with the necessary forms; and

 

10.               Cooperate with us in the investigation or settlement of the claim.

 

B.         Loss Payment

 

1. In the event of loss or damage covered by this Policy, at our option, we shall do one of the following:

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