1. Study 7 – Extra Expense Insurance
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C40 – Business Interruption Insurance
Study 7 – Extra Expense Insurance

2. Study 7 – Extra Expense Insurance
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Study 7 – Extra Expense Insurance
Explain why some businesses need extra expense insurance
Define the terms shown in the Definitions section
Distinguish each clause in an Extra Expense form
Comment briefly on the rating of the Extra Expense form
Describe how an amount of insurance should be chosen under an Extra Expense form
Describe how losses are settled under an Extra Expense form

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Introduction

4. The Need for Extra Expense Insurance
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The Need for Extra Expense Insurance
Some businesses must avoid shutdown
Alternatives should be arranged
Steps to resume operations elsewhere
Expenses may exceed income
Many classes of risk have this need
Not four forms but two

5. Extra Expense (Named Perils) (IBC Form 4110A)
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Extra Expense (Named Perils) (IBC Form 4110A)

6. Definitions The business of the insured.
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Definitions
The business of the insured.
Specified in the Declarations page.

7. Definitions Direct physical loss of or damage to property.
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Definitions
Direct physical loss of or damage to property.
At the insured premises.
From a Peril insured.

8. Definitions Means the Declarations Page applicable to this form.
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Definitions
Means the Declarations Page applicable to this form.

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Definitions
The excess of the total cost during the indemnity period for the purpose of continuing the insured’s business over and above the total cost that would normally have been incurred.

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Definitions
The period beginning with the occurrence of the “Damage” and ending not later than such length of time, not exceeding 12 calendar months.

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Definitions
Means 30 consecutive days.

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Definitions
The condition which would have existed had no loss occurred.

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Definitions
The entire area within the property lines and areas under adjoining sidewalks and driveways.
At the location described on the Declarations Page.

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Indemnity Agreement
In the event that the “Business” shall be interrupted as a direct result of “Damage”, the Insurer shall pay to the Insured the necessary “Extra Expenses” incurred by the Insured during the “Indemnity Period” in order to continue as nearly as practicable the normal conduct of the “Business”, in accordance with the terms and conditions of this Form.

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Perils Insured

18. Exclusions – First Group
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Exclusions – First Group

19. Exclusions – Second Group
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Exclusions – Second Group

20. Clauses Interruption by Civil Authority Permission
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Clauses
Interruption by Civil Authority
Permission
Breach of Conditions
Reinstatement
Subrogation
Property Protection Systems

21. Extra Expense (Broad Form) (IBC Form 4110B)
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Extra Expense (Broad Form) (IBC Form 4110B)

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Named Perils
Provides coverage on losses incurred from hazards or events named on the policy

23. Exclusions – First Group
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Exclusions – First Group

24. Exclusions – Second Group – Part I
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Exclusions – Second Group – Part I

25. Exclusions – Second Group – Part II
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Exclusions – Second Group – Part II

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Rating

27. Choosing an Amount of Insurance
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Choosing an Amount of Insurance

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Loss Settlement

29. The End……………… Questions?????????????????
Discussion>>>>>>>>>>>>>>>>