Misunderstood Personal Lines Issues (Part 1)
Page 3 of 7




Computers

The questions
  • Are computers covered?
  • Are there limitations in the form?
  • What are the perils?
  • What about virus coverage?
  • If I use them for business, do I have a problem?

    Let's look at the policy...

    Special Limits of Liability
    These limits do not increase the Coverage C limit of liability. The special limit for each numbered category below is the total limit for each loss for all property in that category.

    8. $2500 on property, on the "residence premises" used at any time in any manner for any "business" purpose.
    9. $250 on property, away from the "residence premises," used at any time or in any manner for any "business" purpose. However, this limit does not apply to loss to adaptable electronic apparatus as described in Special Limits 10. and 11. below.

    The answers

    Are computers covered?
    Computers are covered as "Your Personal Property" within the limit on the policy.

    Are there limitations in the form?
    On the ISO policy there is no mention of a Special Limit for computers.

    What are the perils?
    The following is a list of the perils insured for your computer. (We suspect, however, that the loss of your computer is the least of your concerns during a volcanic eruption.)
    1. Fire or lightning
    2. Windstorm or hail
    3. Explosion
    4. Riot or civil commotion
    5. Aircraft
    6. Vehicles
    7. Smoke
    8. Vandalism or malicious mischief
    9. Theft
    10. Falling objects
    11. Weight of ice, snow or sleet
    12. Accidental discharge or overflow of water or steam
    13. Sudden and accidental tearing apart, cracking, burning or bulging
    14. Freezing
    15. Sudden and accidental damage from artificially generated electrical current
    16. Volcanic eruption

    Coverage is provided for the same Named Perils that are on the policy for "Your Personal Property", which certainly leaves some gaps as respects computers.

    What about virus coverage?
    There is no coverage for a virus since this is not a named peril. An Electronic Data Processing policy is the appropriate coverage.

    If I use them for business, do I have a problem?
    Business use "at any time or in any manner", past OR present, limits coverage to $2500 on premises and $250 off premises. This can be increased for certain types of business personal property.

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    Not only are policy forms, clauses, rules and court decisions constantly changing, but forms vary from company to company and state to state. This material is intended as a general guideline and might not apply to a specific situation. The authors, LunchTimeCE, Inc., CEfreedom, and Insurance Skills Center, and any organization for whom this course is administered will have neither liability nor responsibility to any person or entity with respect to any loss or damage alleged to be caused directly or indirectly as a result of information contained in this course.