Attaching to and forming part of St. Paul Surplus Lines Insurance Company (hereinafter referred to as
the Company) Policy No. MU0559.
1. INSURED:
2. PERILS INSURED AGAINST:
This policy insures against all risks of direct physical loss or damage occurring during the period of this
policy to the insured property from any external cause, except as hereinafter excluded.
3. COVERAGE CLAUSE:
See Schedule of Insurance, Endorsement No. 1 attached (Excepting as hereinafter specifically
excluded) on all buildings, tanks, structures, stock, furniture, fixtures, machinery and contents, including
metal smokestacks; all while on premises described being property owned by the Insured; and provided
the Insured is legally liable therefore, personal property (except as otherwise excluded) while held in trust,
on commission, or on consignment, for alteration or repair, including the value of labor and materials
expended on the property of others, or leased or sold but not delivered or removed; all comprising or
appertaining to their operations located as per Endorsement No. 1, Schedule of Insurance.
4. DEDUCTIBLES:
Each claim for loss or damage arising out of any occurrence caused by a covered peril shall be adjusted
separately and from the amount proven to be due thereunder the sum of $,000.
shall be deducted.
5. PROPERTY EXCLUDED:
This policy does not cover:
(A) Currency, money, deeds, evidence of debt, notes, securities, jewelry, precious stones, valuable
papers, accounts receivable, bullion, gold, silver, platinum (except platinum in process vessels);
(B) Crude oil, natural gas or other minerals prior to their recovery above ground;
(C) Animals, growing crops, lawns, trees, plants and shrubs;
(D) Land values, cost of grading, excavations and fillings;
(E) Architects’ fees;
(F) All pilings, piers, docks, wharves, breasting dolphins;
(G) Foundations of every description which are below the under surface of the lowest basement floor, or
where there is no basement, which are below the surface of the ground;
(H) Underground piping and contents, fittings, conduits, drains and flues;
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(I)
Earthen or concrete flow or storage pits or reservoirs and their contents, except this exclusion shall
not apply to above ground oil traps or separators of other than earthen construction which are part of a
sewer disposal system;
(J) Motor vehicles, including any automotive equipment, trailer or semi-trailer, licensed for use on public
highways and their contents;
(K) Railway or railroad rolling stock and contents (except contents on above described premises
consigned to or to be shipped by the Insured while not under the control of the public carrier);
(L) Aircraft and their contents;
(M) Waterborne vessels and their contents;
(N) Data processing equipment and media except for the perils of fire, extended coverage and vandalism
and malicious mischief;
(O) All property specifically insured elsewhere;
(P) Property while in transit;
(Q) Property in course of construction;
(R) Property located offshore or beyond the shoreline (in Gulf of Mexico off Texas and Louisiana,
“offshore and beyond the shoreline” is to seaward of the inland edge of the lease block of the plane
coordinate system, as defined on United States Department of the Interior, Bureau of Land
Management offshore leasing maps. Elsewhere, offshore shall mean the seacoasts of United States
including Alaska), except that structures (and their contents) extending from land or shore are not to
be considered as offshore.
6. PERILS EXCLUDED:
This policy does not insure against loss or damage caused by or resulting from:
(A) Pollution;
(B) Contamination;
(C) Seepage or evaporation;
(D) Spillage or leakage including cost of clean-up operations unless resulting from direct physical loss or
damage to the tanks, taps or pipes by an insured peril; (cost of clean-up operations shall not cover for
expenses of removal of any property or debris which discharges, releases, or escapes into or upon
any watercourse or body of water whether above or below ground, nor for expenses of removal of any
property or debris located off the premises of the Insured);
(E)
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(i)
Asbestos material removal unless the asbestos is itself damaged by fire, lightning, aircraft
impact, explosion, riot, civil commotion, smoke, vehicle impact, windstorm or hail, vandalism,
malicious mischief, leakage or accidental discharge from automatic fire protective systems;
(ii)
Demolition or increased cost of reconstruction, repair, debris removal or
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loss of use necessitated by the enforcement of any law or ordinance regulating asbestos
material;
(iii)
Any governmental direction or request declaring that asbestos material present in or part of or
utilized on any undamaged portion of the Insured’s property can no longer be used for the
purpose for which it was intended or installed and must be removed or modified;
(F) Delay, loss of use, loss of market, inherent vice, latent defect, ordinary wear or tear, gradual
deterioration, rust, corrosion, wet or dry rot, mold, moths, vermin, termites or insects, dampness of
atmosphere, freezing or other extremes of temperature, smog, loss of weight, shrinkage, change in
flavor or color or texture or finish, nor normal settling or expansions in buildings or foundations;
(G) Infidelity or dishonesty of the Insured or any of his employees or persons to whom the property
described herein is entrusted; nor loss or damage resulting from the Insured voluntarily parting with
title or possession of any property if induced to do so by any fraudulent scheme, trick, device or false
pretense; nor any unexplained loss, mysterious disappearance, or loss or shortage disclosed on
taking inventory;
(H) Faulty or defective workmanship or materials, errors or omission in design or specification or
processing or packaging, blending or mixing; unless fire, explosion, or collapse ensues and then only
for loss or damage caused by such ensuing fire, explosion, or collapse;
(I)
Loss, damage, costs, expenses, fines or penalties incurred or sustained by or imposed on the Insured
at the order of any Government Agency, Court or other Authority arising from any cause whatsoever;
(J) Loss or damage resulting from the solidification of the contents of molten pots, molten pot lines and/or
appurtenances;
(K) Mechanical breakdown or derangement of machinery or equipment, rupture or bursting of rotating or
moving parts of machinery caused by centrifugal force, nor rupture, bursting or operation of pressure
relief devices;
(L) Electrical injury or disturbance of electrical appliances, devices, fixtures or wiring caused by electrical
currents artificially generated unless fire ensues and, if fire does ensue, this Company shall be liable
only for its proportion of loss caused by such ensuing fire;
(M) Explosion or rupture or bursting of steam boilers or steam pipes or steam turbines or steam engines if
owned by or operating under the control of the Insured; except that this Company shall be liable for
direct explosion loss caused by internal pressure of steam in processing machinery, equipment or
apparatus and direct loss resulting from the explosion of accumulated gases or unconsumed fuel
within the firebox (or combustion chamber) of any fired vessel or within the flues or passages which
conduct the gases of combustion therefrom;
(N) Overheating or thermal shock or venting of any catalyst unless caused directly by perils not otherwise
excluded;
(O) Backing up of sewers or drains, or seepage of water below ground level or wavewash unless caused
directly by perils not otherwise excluded;
(P) Loss occasioned by enforcement of any ordinance or law regulating the construction, repair, or
demolition of any real property insured hereunder;
(Q) Nuclear reaction or nuclear radiation or radioactive contamination, all whether controlled or
uncontrolled, or due to any act or condition incident to any of the foregoing, and whether such loss be
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direct or indirect, proximate or remote, or be in whole or in part caused by, contributed to or
aggravated by any of the perils insured against in this policy;
(R) Hostile or warlike action in time of peace or war, including action in hindering, combating or defending
against an actual, impending or expected attack, (A) by any government or sovereign power (de jure
or de facto) or by any authority maintaining or using military, naval or air forces, or (B) by military,
naval or air forces or (C) by an agent of any such government, power authority or forces;
Any weapon of war employing atomic fission or radioactive force whether in time or peace or war;
Insurrection, rebellion, revolution, civil war, usurped power, or action taken by governmental authority
in hindering, combating or defending against such an occurrence, seizure or destruction under
quarantine of customs regulations, confiscation by order of any government or public authority or risks
or contraband or illegal transportation or trade.
(S) Earthquake, landslide, subsidence, volcanic eruption or any other earth movement (all whether or not
naturally occurring), unless specifically endorsed hereon as being insured;
(T) Flood, surface water, mudslide or mud flow, waves, tidal water or tidal waves, overflow of streams or
other bodies of water, or spray from any other foregoing, all whether driven by wind or not (all whether
or not naturally occurring), release of water impounded by a dam, unless specifically endorsed hereon
as being insured.
7. TITLES OF PARAGRAPHS:
The several titles of the various paragraphs of this form (and of endorsements and supplemental contracts,
if any, as now or hereafter attached to this policy) are inserted solely for the convenience of reference and
shall not be deemed in any way to limit or affect the provisions to which they relate
8. COINSURANCE CLAUSE:
In consideration of the rate and/or form under which this policy is written, it is expressly stipulated and
made a condition of this contract that the Insured shall at all times maintain insurable values on this policy
for premium purposes to the extent of at least ninety percent (90%) of actual cash value at the time of the
loss, and that failing to do so, the Insured shall to the extent of such deficit bear his or their proportion of
any loss.
In the event that the aggregate claim for any loss is less than two percent (2%) of the total insurable value
declared upon the property described herein at the time such loss occurs, the Insured shall not be required
to furnish any inventory of the undamaged property to establish the actual cash value referred to in the
coinsurance clause, provided, however, that nothing herein shall be construed to waive the application of
the coinsurance clause.
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9. IMPROVEMENTS AND BETTERMENTS:
In the event of loss or damage, this Company agrees to accept and consider the Insured as sole and
unconditional owner or improvements and betterments, any contract or lease the Insured may have made
to the contrary notwithstanding.
10. BASIS OF SETTLEMENT:
In case of loss, the basis of adjustment unless otherwise endorsed hereon shall be as follows:
(A) Real and personal property, except as noted below, at actual cash value at time and place of loss;
(B) On books of account, abstracts drawings, card index systems and other records (except film, tape,
(C)
(D)
(E)
disc, drum, cell and other magnetic recording or storage media for electronic data processing), to not
exceeding the cost of blank books, cards, or other blank material plus the cost of labor incurred by
the Insured for transcribing or copying such records;
On film, tape, disc, drum, cell and other magnetic recording or storage media for electronic data
processing, to not exceeding the cost of such media in unexposed blank form;
Exhibitions and displays, at cost to Insured;
To any part of a machine or unit consisting of two or more parts when complete either for sale or use,
the liability of the Company shall be limited to the value of the part or parts lost or damaged, or at the
Insured’s option the cost and expense of replacing or duplicating the lost or damaged part and/or
parts and/or repairing of the machine or unit.
11. BRAND AND LABEL CLAUSE:
It is agreed that if branded or labeled merchandise covered by this policy is damaged, and the Company
elects to take all or part of the property at the agreed appraised value, the Insured may at his own expense,
stamp “salvage” on the merchandise or its containers or may remove the brands or labels, if such stamp or
removal will not physically damage the merchandise.
12. PERMISSION:
Permission is hereby given to make additions, alterations and repairs and this insurance shall cover therein
and thereon without notice; to cease operations and to remain vacant or unoccupied as occasion may
require; for such use of the premises as is usual and incidental in the business conducted therein, and to
keep and use all articles and materials usual and incidental to said business, in such quantities as the
exigencies of the business require.
13. BREACH OF WARRANTY CLAUSE:
If a breach of any warranty or condition contained in any rider attached to or made a part of this policy shall
occur which breach by the terms of such warranty or condition shall operate to suspend or void this
insurance, it is agreed that such suspension or avoidance due to such breach shall be effective only during
the continuance of such breach and then only as to the buildings, fire division, contents therein, or other
separate location to which such warranty or condition has reference and in respect of which such breach
occurs.
14. SUBROGATION WAIVER CLAUSE:
This insurance shall not be invalidated if the Insured in writing has waived or may hereafter, but prior to the
occurrence of any loss covered hereunder, waive its right of recovery from any firm, corporation or
individual for loss or damage covered hereunder and this Company expressly waives subrogation against
any subsidiary or affiliated company of the Insured.
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15. DEBRIS REMOVAL CLAUSE: (Applies Only to Items Of the Insurance Covering Direct Property Loss)
This insurance covers expenses incurred in the removal of all debris of the property covered hereunder,
from premises covered hereunder, which may be occasioned by loss caused by any of the perils insured
against in this policy. However, the total liability under this policy for both loss to property and removal of
debris shall not exceed the amount of insurance applying under this policy to the property damaged or
destroyed. This Company shall not be liable for more than the proportion of such debris removal expenses
as the amount of insurance under this policy bears to the total amount of insurance on the property
covered hereunder, whether or not all such insurance includes this clause. Unless liability is otherwise
specifically assumed by endorsement attached hereto, this Company shall not be liable for debris removal
expense occasioned by the enforcement of any federal, state or municipal laws or ordinances which
necessitate the demolition of any portion of property covered hereunder which has or has not suffered
damage by any of the perils insured against. Debris removal expense shall not be considered in the
determination of actual cash value in the application of any coinsurance, average, distribution, or reduced
rate contribution clause attached to this policy.
It is understood and agreed that the Company will not pay the expense to:
a)
Extract contaminants or pollutants from the debris, land, water, or atmosphere;
b)
Remove, restore or replace contaminated or polluted land or water;
c)
Remove or transport any property or debris to a site for storage or decontamination, required
because the property or debris is affected by pollutants or contaminants, whether or not such
removal, transport, decontamination is required by law or regulation.
It is a condition precedent to recovery under this extension that the Company shall have paid or agreed
to pay for physical loss or damage and that the Insured shall give notice to the Company of intent to
claim for cost of removal of debris or cost of clean up NO LATER THAN TWELVE (12) MONTHS AFTER
THE DATE OF SUCH PHYSICAL LOSS OR DAMAGE.
16. UTILITY FAILURE – LOSS EXCLUSION CLAUSE:
This Company shall not be liable for loss directly or indirectly caused by or resulting from any utility failure
including but not limited to power, heating or cooling failures, unless such failure results from physical
damage to power, heating or cooling equipment situated on the premises where the property covered is
located, caused by the peril(s) insured against.
17. FOAM LOSS ASSUMPTION CLAUSE:
In consideration of the rate or premium at which this policy is written, this Company shall be liable for the
loss to foam or other fire extinguishing material lost, expended, or destroyed in fighting fire involving
property insured hereunder, including the loss to similar materials which may be brought on the premises
for the purpose of extinguishing a fire already in progress at the time such materials are ordered and
delivered, but the liability shall not exceed the combined value of such extinguished materials which are on
the premises or on adjacent premises if such materials are jointly owned, at the time the fire originates.
18. NOTICE OF LOSS:
In the event of loss or damage under this policy, the Insured shall give notice of loss or damage to the
Company as soon thereafter as practicable and shall also file with the Company within sixty (60) days from
the date of loss a detailed sworn proof of loss. Failure by the Insured to report the said loss or damage and
to file such sworn proof of loss as hereinbefore provided shall invalidate any claim under this policy for
such loss.
19. PAYMENT OF LOSS:
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All adjusted claims shall be due and payable thirty (30) days after the presentation and acceptance of
satisfactory proofs of loss at the office of this Company.
20. REINSTATEMENT:
With the exception of loss caused by perils which are subject to Annual Aggregate Limits as noted in Limit
of Liability, it is a condition of this contract that in case of loss occurring hereunder, the amount of such loss
shall be automatically reinstated after its occurrence without payment of additional premium for such
reinstatement.
21. APPRAISAL:
If the Insured and this Company fail to agree as to the amount of loss each shall, on the written demand of
either, made within sixty (60) days after receipt of proof of loss by the Company, select a competent and
disinterested appraiser and the appraisal shall be made at a reasonable time and place. The appraisers
shall first select a competent and disinterested umpire and failing for fifteen (15) days to agree upon such
umpire, then, on the request of the Insured or this Company such umpire shall be selected by a judge of a
court of record in the county and state in which such appraisal is pending. The appraisers shall then
appraise the loss, stating separately the value at the time of loss and the amount of loss, and failing to
agree shall submit their differences to the umpire. An award in writing of any two shall determine the
amount of loss. The Insured and this Company shall each pay his or its chosen appraiser and shall bear
equally the other expenses of the appraisal and the umpire.
22. ASSISTANCE AND COOPERATION OF THE INSURED:
The Insured shall cooperate with this Company, and upon this Company’s request shall attend hearings
and trials and shall assist in effecting settlement, securing and giving evidence, obtaining the attendance of
witnesses and in the conduct of suits.
23. SUE AND LABOR:
In case of actual (or imminent, with prior notice to and approval from this Company) loss or damage it shall
be lawful and necessary for the Insured, their factors, servants or assigns, to sue, labor and travel for, in
and about the defense, safeguard and recovery of the property insured hereunder, or any part thereof,
without prejudice to this insurance, nor shall the acts of the Insured or this Company in recovering, saving,
and preserving the property insured in case of loss or damage be considered a waiver or acceptance of
abandonment; to the charges whereof this Company will contribute according to the rate and quantity of
the sum insured herein.
24. MISREPRESENTATION AND FRAUD:
This policy shall be void if the Insured has concealed or misrepresented any material fact or circumstance
concerning this insurance or the subject thereof or in case of any fraud, attempted fraud or false swearing
by the Insured touching any matter relating to this insurance or the subject thereof, whether before or after
a loss.
25. SUIT AGAINST THE COMPANY:
No suit or action on this policy for the recovery of any claim shall be sustainable in any court of law or
equity unless the Insured shall have fully complied with all the requirements of this policy, nor unless
commenced within twelve (12) months next after the happening becomes known to the Insured’s home
office insurance department, unless a longer period of time is provided by applicable statute.
26. AUDIT:
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The Company through its authorized representative shall be privileged to inspect the books and records of
the Insured pertaining to the subject matter of this insurance at all reasonable times during the life of this
policy and for twelve (12) months after expiration or termination date of the insurance. Any evasion or
attempted evasion by the Insured in connection with statements, payment of premium or any matter
relating to this insurance shall void such policy and shall be an absolute defense to any suit or action
brought under such policy.
27. ABANDONMENT:
There can be no abandonment to this Company of the property insured.
28. ASSIGNMENT:
Assignment or transfer of this policy shall not be valid except with the written consent of the Company.
29. CONFLICT OF WORDING:
The conditions contained in this form shall supersede those of the basic policy to which this form is
attached wherever the same may conflict.
30. CANCELLATION:
This policy may be cancelled by the Insured by surrender thereof to the Company or by mailing to the
Company written notice stating when thereafter such cancellation shall be effective. This policy may be
cancelled by the Company by mailing to the Insured at the address shown in this policy or last known
address written notice, with or without tender of the excess of paid premium above the pro rata premium for
the expired time, stating when, not less than thirty (30) days thereafter (ten (10) days in the event of nonpayment of premium), such cancellation shall be effective. The mailing of notice as aforesaid shall be
sufficient proof of notice. The effective date and hour of cancellation stated in the notice shall become the
end of the policy period. Delivery of such written notice either by the Insured or this Company shall be
equivalent to mailing. If the Insured cancels, earned premium shall be computed in accordance with the
customary short rate table and procedure. If the Company cancels, earned premium shall be computed
pro rata, premium adjustment may be made as soon as practicable after cancellation becomes effective.
31. SUBROGATION OR LOAN:
If, in the event of loss or damage, the Insured shall acquire any right of action against any individual, firm or
corporation for loss of, or damage to property covered hereunder, the Insured will, if requested by the
Company, or at the Company’s option execute and deliver to the Company the customary form of loan
receipt upon receiving an advance of funds in respect of the loss or damage; and will subrogate the
Company to, or will hold in trust for the Company, all such rights of action to the extent of the amount paid
or advanced, and will permit suit to be brought in the Insured’s name under the direction of and at the
expense of the Company.
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32. OTHER INSURANCE:
This policy does not cover any loss or damage which at the time of the happening of such loss or damage
is insured by, or would, but for the existence of this policy, be insured by any other insurance policy or
policies either primary or excess.
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