Question from an IIABNY member: I have an Insured that leases medical equipment to others where the property coverage is provided by an inland marine policy with one carrier and the package policy is with a different carrier due to the class of business.
The package carrier has a coinsurance clause on their policy and is aware of the inland marine policy. I asked the package carrier to endorse their policy, as I believe there's an ISO property endorsement where you can list "Property Not Covered" under the package policy, hence avoiding a potential issue with coinsurance. The package carrier said there's no such endorsement but referred to the Building and Personal Property coverage form under its section entitled "Property Not Covered" (to para-phrase: property more specifically described under another policy).
Perhaps ISO no longer uses the "Property Not Covered" endorsement that I recall from several years ago. Let me know if you have any suggestions.
Answer: Sounds like you’re talking about ISO endorsement CP 14 20 11 91, Additional Property Not Covered. However, this endorsement excludes certain types of pre-defined property, such as personal property contained in safes or vaults, contents of crop silos, property of others, stock, contents of vending machines, etc. None of the categories listed on the endorsement appear to include leased medical equipment.
You have a couple of options here:
- Take the underwriter’s word for it that the insured will not suffer a coinsurance penalty because of the language built into the B&PP coverage form.
- Ask the underwriter for a manuscript endorsement specifically stating that property insured under the IM policy is considered not covered under the package.
- Ask the underwriter to insure the property on the package policy on an agreed value basis, thus suspending the coinsurance clause. In my opinion, this might be the best option of the three.