6.12 Section II Conditions

Conditions Applying Only to Section II

Duties After Occurrence

After an occurrence, the insured has certain duties that must be completed to help the insurer investigate, settle, or defend a claim. These duties are important because they give the insurer the information and cooperation needed to properly handle the loss. After an occurrence, an insured must:

• Provide written notice to the insurer as soon as practical. The notice should identify the policy and the named insured, describe the circumstances of the occurrence, and include the names and addresses of any claimants and witnesses.
• Cooperate with the insurer during the investigation, settlement, or defense of any claim.
• Promptly send the insurer any legal or claim-related documents, including notices, demands, summonses, or other legal papers received by the insured.
• Assist the insurer when requested, including helping with settlement efforts, subrogation, court proceedings, and the collection of evidence.
• For Damage to Property of Others, submit a sworn statement of loss to the insurer within 60 days after the loss. The statement must describe the damaged property.

In addition, an insured should not take actions that could affect the insurer's ability to investigate, settle, or defend the claim. This means the insured must not voluntarily make a payment, assume an obligation, or incur an expense related to the claim without the insurer's consent. The only exception is for reasonable expenses incurred while providing first aid to others at the time bodily injury occurs.

Duties of an Injured Person Under Coverage F

To receive payment under Coverage F – Medical Payments to Others, the injured person, or someone acting on that person's behalf, must submit a written proof of claim to the insurer as soon as practical. The proof of claim must be made under oath. The injured person must also authorize the insurer to obtain copies of medical reports and records. This allows the insurer to review the injury, confirm the medical expenses, and determine whether the claim qualifies for payment under the policy.

The injured person must submit to a physical examination by a physician selected by the insurer when reasonably required. The insurer may request these examinations as often as reasonably necessary to evaluate the injury and determine whether the medical payments claim is payable under the policy.

Payment of Claim Under Coverage F

This condition explains that a payment made by the insurer under Coverage F – Medical Payments to Others does not mean the insurer or the insured has admitted legal responsibility for the injury. Coverage F may pay eligible medical expenses without requiring a determination of fault or liability.

Other Insurance

Liability coverage under Section II applies as excess coverage when other collectible insurance is available. This means the other insurance must pay first, and the Homeowners policy responds only after that coverage has been used.However, this rule does not apply if the other insurance is specifically written to be excess insurance. In that case, the policies must be reviewed to determine how coverage will apply.

Other Conditions

Many of the conditions found in Section II are also common in casualty insurance policies generally. These conditions explain how liability claims are handled and identify the responsibilities of both the insured and the insurer after an occurrence. Common Section II conditions include:

Condition	Description
Severability	The insurance provided by the policy applies separately to each insured, without increasing the limit of liability for any one occurrence.
Bankruptcy	Bankruptcy or insolvency of an insured will not relieve the insurer of its obligations.
Suit Against Us	All terms of Section II must be met before legal action can be brought against the insurer.
Policy Period	The policy applies only to bodily injury and property damage occurring during the policy period.

Conditions Applying to Both Section I and Section II

Subrogation

Before a loss occurs, an insured may give up, or waive, the right to recover damages from another person, but the waiver must be in writing. If the insured has not waived this right before the loss, the insurer may require the insured to assign those recovery rights to the insurer after a claim payment is made. This allows the insurer to pursue the responsible third party for reimbursement. This process is known as subrogation.

This condition does not apply to Coverage F – Medical Payments to Others or to the Damage to Property of Others Additional Coverage. As a result, the insurer's right to require an assignment of recovery rights applies only to the coverages where this condition is specifically enforceable.

Termination

The termination provisions in the standard Homeowners forms are generally the same as those found in Dwelling forms. These provisions explain how and when a policy may be canceled or nonrenewed. However, termination rules are often affected by state insurance laws. As a result, the exact requirements for cancellation, nonrenewal, notice periods, and other termination procedures may vary by state.

The insured has the right to cancel the policy at any time and for any reason. Cancellation may be completed by returning the policy to the insurer or by giving the insurer written notice stating the date the cancellation is to take effect.

If the insurer cancels or nonrenews the policy, it must give the insured advance written notice. This notice requirement gives the insured time to respond, obtain replacement coverage, or address the reason for termination when possible. After a policy has been in effect for at least 60 days, the insurer may cancel it only for specific reasons. Common reasons include nonpayment of premium, material misrepresentation by the insured, or a substantial change in the risk being insured.

When a policy is canceled, any unearned premium must be returned to the insured on a pro rata basis. This means the refund is based on the portion of the policy period that remains unused after cancellation. The refund may be provided with the cancellation notice, when the insured returns the policy, or within a reasonable time after the cancellation becomes effective.

Other Conditions

Many of the conditions that apply to the entire Homeowners policy are also common in property and casualty insurance policies generally. These conditions establish important rules for how the policy operates, how changes may be made, and how the rights and duties of the insured and insurer are handled. Common policy conditions include:

Condition	Description
Liberalization Clause	If the insurer makes a change that broadens coverage under the edition of the form used for the policy, and that coverage does not require an additional premium, that change automatically applies to the insured's policy.
Waiver or Change	A waiver or change of a provision must be made in writing by the insurer.
Assignment	To be valid, the insurer must consent to any assignment of the policy.
Concealment or Fraud	The insurer will not provide coverage to any insured if an insured has intentionally concealed or misrepresented material information, engaged in fraudulent conduct, or made false statements related to the provided insurance.
Death	If the named insured or resident spouse dies, the insurer will insure their legal representative with respect to the covered premises and property of the deceased.