North Carolina Insurance Underwriting Association …

1 Edition 03 18 DOI Approved effective NCPC-131434663 North Carolina Insurance Underwriting Association ( NCIUA ) or ( Association ) Coastal Property Insurance Pool Manual of Rules and Procedures 5520 Dillard Drive, Ste. 180 Cary, NC 27518 Phone: Toll Free: Fax: Edition 03 18 DOI Approved effective NCPC-131434663 Table of Contents MISSION STATEMENT .. 1 DISCLAIMER STATEMENT .. 2 INTRODUCTION AND BACKGROUND .. 3 PURPOSE OF THE Association .. 3 TERRITORY AREAS DEFINED .. 4 ANTI-ARSON ACTION PLAN .. 4 AUTHORITY OF AGENTS AND PRODUCERS .. 4 COASTAL PROPERTY Insurance POOL BINDER PROVISIONS.

2 5 PROCEDURES WHEN A NAMED STORM IS WITHIN CERTAIN DESCRIBED COORDINATES .. 5 ELIGIBILITY .. 6 ELIGIBLE APPLICANT .. 6 INELIGIBLE APPLICANT .. 6 ELIGIBLE PROPERTY .. 6 INELIGIBLE PROPERTY .. 6 Underwriting STANDARDS .. 7 7 CRIME Insurance .. 8 VACANT, UNOCCUPIED OR PROPERTIES UNDERGOING RENOVATIONS .. 8 APPLICATIONS WHERE THE PROPERTY HAS UNREPAIRED DAMAGE .. 9 OTHER STRUCTURES IN POOR CONDITION .. 10 FRAUDULENT OR MATERIAL MISREPRESENTATION OR CONCEALMENT .. 10 COVERAGE(S) 10 REPLACEMENT COST COVERAGE GUIDELINES .. 11 APPLYING FOR REPLACEMENT COST COVERAGE .. 11 BROAD PERILS POLICY WITHOUT REPLACEMENT COST COVERAGE GUIDELINES.

3 12 STICK-BUILT HOMES AND MODULAR HOMES .. 12 MOBILE HOMES .. 12 MOBILE HOME GUIDELINES .. 12 TRAVEL TRAILER GUIDELINES .. 13 WINDSTORM AND HAIL POLICIES .. 13 WIND-DRIVEN RAIN COVERAGE .. 14 POLICY FORMS .. 14 POLICY WRITING AND POLICY PROVISIONS .. 14 RATES, RATING PLANS AND RATE RULES .. 14 EFFECTIVE DATE OF COVERAGE .. 15 NEW BUSINESS SIGNATURE REQUIREMENTS .. 15 Edition 03 18 DOI Approved effective NCPC-131434663 NEW BUSINESS PHOTOGRAPH REQUIREMENTS .. 15 MAXIMUM LIMITS OF LIABILITY .. 16 VALUATION OF PROPERTY .. 16 PRIMARY/EXCESS PROCEDURE .. 16 COINSURANCE .. 17 DEDUCTIBLES.

4 17 SHORT TERM POLICIES GUIDELINES .. 17 PAYMENT OF POLICY PREMIUMS .. 17 APPROVAL BILL .. 18 RETURN PREMIUM POLICYHOLDER BILLED .. 18 WAIVER OF ADDITIONAL OR RETURN PREMIUM .. 19 COMMISSIONS .. 19 RETURNED PAYMENT .. 19 CONTINUATION OF COVERAGE (RENEWAL) DECLARATION .. 19 POLICY ASSIGNMENT .. 19 CHANGE OF PRODUCER OF RECORD .. 20 POLICY CHANGES .. 20 CHANGE OF LOCATION .. 20 ADDING A LOCATION TO AN EXISTING POLICY .. 21 INSPECTION OF PROPERTY INSURED .. 21 REQUEST FOR 21 INSPECTIONS .. 21 REINSPECTIONS .. 22 INCOMPLETE INSPECTION (LOCKOUTS) .. 22 PROCEDURES AFTER INSPECTION .. 23 CANCELLATION OF POLICIES.

5 23 CANCELLATION AT INSURED S REQUEST .. 23 CANCELLATION INITIATED BY THE Association .. 23 APPEALS .. 23 PUBLIC RELATIONS .. 24 SPEAKERS .. 24 SUPPLEMENTAL COMMERCIAL Underwriting PROCEDURES .. 25 CONDOMINIUM Association PROCEDURES AND REQUIRED 26 MANUFACTURING RISKS .. 26 APPROPRIATE CLASSES OF MANUFACTURING RISKS .. 26 MANUFACTURING RISKS Underwriting GENERAL RULES .. 26 BUSINESS INCOME Underwriting GUIDELINES .. 26 OPEN SIDED STRUCTURE DEFINITION .. 27 HOMEOWNER Underwriting GUIDELINES .. 28 Edition 03 18 DOI Approved effective NCPC-131434663 HOMEOWNER POLICY FORMS WRITTEN.

6 29 NAMED INSURED REQUIREMENT .. 29 HO 00 03, HO 00 02, HO 00 08, and HO 00 06 .. 29 HO 00 04 .. 29 APPLICATION REQUIREMENT .. 29 BASIC POLICY LIMITS .. 29 HO 00 02 AND HO 00 03 .. 29 HO 00 08 ACV HO0481 Loss Settlement-ACV .. 29 HO 00 04 .. 29 HO 00 06 .. 30 ALL FORMS .. 30 RESIDENCY REQUIREMENT .. 30 FLOOD REQUIREMENT .. 30 CONSTRUCTION REQUIREMENT .. 30 Insurance TO VALUE REQUIREMENTS .. 30 HO 00 02 .. 30 HO 00 03 .. 30 HO 00 08 .. 30 PROTECTION CLASS REQUIREMENTS .. 30 PRIOR LOSS ACTIVITY REQUIREMENTS .. 31 AGE OF HOME REQUIREMENTS .. 31 HO 00 02 AND HO 00 03 .. 31 HO 00 08 .. 31 HO 00 02, HO 00 03 and HO 00 08.

7 31 HISTORIC HOMES .. 31 PROXIMITY TO TIDAL WATERS .. 31 OCCUPANCY REQUIREMENTS .. 31 GENERAL RULES OF CONDITION .. 32 GENERAL RULES REGARDING LIABILITY COVERAGES .. 32 STANDARD AND OPTIONAL ENDORSEMENT OFFERED .. 32 INCIDENTAL FARMING EXPOSURE .. 33 BUILDERS RISK .. 33 INCIDENTAL OFFICE EXPOSURE .. 33 GOLF CARTS AND OTHER MISCELLANEOUS LAND CONVEYANCES .. 33 BUSINESS PURSUITS .. 33 APPLICATION PROCESS .. 34 DYNAMIC WEB APPLICATIONS - PREFERRED METHOD .. 35 MANUAL APPLICATIONS .. 35 THE FOLLOWING BASIC AND SUPPLEMENTAL APPLICATIONS ARE AVAILABLE: .. 35 Edition 03 18 DOI Approved effective NCPC-131434663 Association SPECIFIC APPLICATIONS AVAILABLE.

8 35 ACORD APPLICATIONS .. 35 CRIME APPLICATIONS .. 35 TAKE OUT PROGRAM .. 36 PURPOSE OF PROGRAM .. 37 PROGRAM PARAMETERS .. 37 COMMITMENT FORM .. 37 Edition 03 18 DOI Approved effective NCPC-131434663 1 MISSION STATEMENT The North Carolina Insurance Underwriting Association , also known as the Coastal Property Insurance Pool, is a tax exempt Association of Insurance companies authorized to write and engage in writing essential property Insurance coverage in North Carolina . The Association was created by law to act as a market of last resort to provide adequate essential property Insurance to property owners having insurable property in the Beach and Coastal Areas of North Carolina .

9 Edition 03 18 DOI Approved effective NCPC-131434663 2 DISCLAIMER STATEMENT This Manual provides information regarding Association procedures and general information about the Association . While the Association follows the procedures described in this Manual, the procedures are subject to change. The Association reserves the right to modify, revoke, suspend, terminate or change any or all procedures and applications described in this Manual, in whole or in part, with the approval of the North Carolina Department of Insurance . In the event of a conflict between this Manual and the Association s Plan of Operation, the applicable provisions in the Plan of Operation shall govern.

10 The language used in this Manual is not intended to create, nor may it be construed as, a contract between the Association and any Insurance Agent, Producer, Broker, Applicant, Insured, or any Agent or Legal Representative acting on their behalf. Edition 03 18 DOI Approved effective NCPC-131434663 3 INTRODUCTION AND BACKGROUND The NCIUA was created in 1969 pursuant to Article 45 of the North Carolina Insurance Law (Chapter 58 of the North Carolina General Statutes) to provide adequate essential property Insurance , as a market of last resort, for risks located on the North Carolina barrier islands along the Atlantic Ocean.