Md. Code Regs. 31.08.06.02

Current through Register Vol. 51, No. 22, November 1, 2024

Section 31.08.06.02 - Coverage

A. Marine or transportation policies, or both, may cover under the following conditions provided in this regulation.

B. Imports.

(1) A shipment on consignment means property consigned and intrusted to a factor or agent to be held in his care, or under his control for sale for account of another or for exhibit or trial or approval or auction, and if not disposed of, to be returned.

(2) Imports on consignment may be covered wherever the property may be and without restriction as to time, provided the coverage of the issuing companies includes hazards of transportation.

(3) Imports not on consignment in such places of storage as are usually employed by importers, provided the coverage of the issuing companies includes hazards of transportation.

(4) These policies may also include the same coverage in respect to property purchased on C. I. F. terms or spot purchases for inclusion with or in substitution for bona fide importations.

(5) An import, as a proper subject of marine or transportation insurance, shall be deemed to maintain its character as such so long as the property remains segregated in the original form or package in such a way that it can be identified and has not become incorporated and mixed with the general mass of property in the United States, and shall be deemed to have been completed when the property has been:

(a) Sold and delivered by the importer, factor or consignee;

(b) Removed from place of storage as described in §B(3) of this regulation and placed on sale as part of importer's stock in trade at a point of sale-distribution; or

(c) Delivered for manufacture, processing, or change in form to premises of the importer or of another used for these purposes.

C. Exports.

(1) Exports may be covered whenever the property may be without restriction as to time, provided the coverage of the issuing companies includes hazards of transportation.

(2) An export, as a proper subject of marine or transportation insurance, shall be deemed to acquire its character as such when designated or while being prepared for export and retain that character unless diverted for domestic trade, and when so diverted, the provisions of §D of this regulation respecting domestic shipments shall apply, provided, however, that this provision does not apply to long established methods of insuring certain commodities, for example, cotton.

D. Domestic Shipments.

(1) Domestic shipments on consignment, provided the coverage of the issuing companies includes hazards of transportation:

(a) Property shipped on consignment for sale or distribution, while in transit and not exceeding 120 days after arrival at consignee's premises or other place of storage or deposit; and

(b) Property shipped on consignment for exhibit, or trial, or approval or auction, while in transit, while in the custody of others and while being returned.

(2) Domestic shipments not on consignment, provided the coverage of the issuing companies includes hazards of transportation, beginning and ending within the United States, provided that these shipments may not be covered at manufacturing premises or after arrival at premises owned, leased, or operated by assured or purchaser, or for more than 90 days at other place of storage or deposit, except in premises of transportation companies or freight forwarders, when the storage is incident to transportation.

E. Bridges, Tunnels, and Other Instrumentalities of Transportation and Communication.

(1) Bridges, tunnels, and other instrumentalities of transportation and communication (excluding buildings, their furniture and furnishings, fixed contents, and supplies held in storage) unless fire, tornado, sprinkler leakage, hail, explosion, earthquake, riot, or civil commotion are the only hazards to be covered. Piers, wharves, docks, and slips, excluding the risks of fire, tornado, sprinkler leakage, hail, explosion, earthquake, riot, or civil commotion. Other aids to navigation and transportation, including dry docks and marine railways, against all risks.

(2) The foregoing includes:

(a) Bridges, tunnels, other similar instrumentalities, unless fire, lightning, windstorm, sprinkler leakage, hail, explosion, earthquake, riot, or civil commotion are the only perils to be covered;

(b) Piers, wharves, docks, and slips, but excluding the risks of fire, lightning, windstorm, sprinkler leakage, hail, explosion, earthquake, riot, or civil commotion;

(c) Pipelines, including on-line propulsion, regulating and other equipment appurtenant to pipelines, but excluding all property at manufacturing, producing, refining, converting, treating, or conditioning plants;

(d) Power transmission and telephone and telegraph lines, excluding all property at generating, converting, or transforming stations, sub-stations, and exchanges;

(e) Radio and television communication equipment in commercial use as such including towers and antennae with auxiliary equipment, and appurtenant electrical operating and control apparatus but excluding buildings, their improvements and betterments, furniture and furnishings, and supplies held in storage in the building;

(f) Outdoor cranes, loading bridges, and similar equipment used to load, unload, and transport.

F. Personal Property Floater Risks-----Individuals.

(1) Tourists floater, personal effects floater policies.

(2) The personal property floater.

(3) Government service floaters.

(4) Personal fur floaters.

(5) Personal jewelry floaters.

(6) Wedding present floaters for not exceeding 90 days after the date of the wedding.

(7) Silverware floaters.

G. Personal Property Floater Risks-----General Coverage.

(1) Fine Arts Floaters, Stamp and Coin Floaters. To cover objects of art such as pictures, statuary, bronzes and antiques, rare manuscripts and books, articles of virtu, etc.

(2) Musical Instrument Floaters. Radios, televisions, record players, and combinations thereof are not deemed musical instruments.

(3) Radium Floaters.

(4) Physicians' and Surgeons' Instrument Floaters. These policies may include coverage of the furniture, fixtures, and tenant assured's interest in the improvements and betterments of buildings as are located in that portion of the premises occupied by the assured in the practice of his profession.

(5) Pattern and die floaters, excluding coverage on the owner's premises.

(6) Theatrical floaters, excluding buildings and their improvements and betterments, and furniture and fixtures that do not travel about with theatrical troupes.

(7) Film floaters, including builders' risk during the production and coverage on completed negatives and positives and sound records.

(8) Salesmen's samples floaters.

(9) Jewelers' block policies, including tenant assured's interest in improvements and betterments of buildings, furniture, fixtures, tools, machinery, patterns, molds, and dies.

(10) Exhibition policies on property while on exhibition and in transit to or from the exhibitions.

(11) Live animal floaters, covering wherever animals, wagons, and mobile equipment may be.

(12) Installation Risks.

(a) Installation risks, covering machinery and equipment including plumbing, heating, cooling and electrical systems (as distinguished from building materials) while in transit to place of installation and during the period of installation and testing. Coverage shall cease when whichever of the following first occurs:

(i) When the property is insured for the account of the seller or installer, when the interest of the insured ceases; or

(ii) Not later than when the property has been accepted as satisfactory.

(b) Building materials (e.g., structural steel, lumber, bricks and mortar), while in transit to place of installation and after arrival thereat but the coverage shall terminate when the materials are installed and have become a physical part of the realty or when the seller's interest ceases, whichever first occurs.

(13) Mobile articles, machinery, and equipment floaters (excluding motor vehicles designed for highway use and auto homes, trailers, and semitrailers except when hauled by tractors not designed for highway use and snowplows constructed exclusively for highway use), covering identified property of a mobile or floating nature, not on sale or consignment, or in course of manufacture, which has come into the custody or control of parties who intend to use the property for the purpose for which it was manufactured or created. These policies do not cover furniture and fixtures not customarily used away from premises where the property is usually kept.

(14) Bailees.

(a) Property in transit to or from and in the custody of:

(i) Bleacheries, throwsters, fumigatories, dyers, cleaners, laundries, and similar bailees;

(ii) Needleworkers;

(iii) Other bailees (not owned, controlled, or operated by the bailor) for the purpose of performing work thereon (as distinguished from the making of a complete article) including the treatment of, or assemblage of property on the premises of bailees.

(b) These policies do not cover bailee's property at his premises.

(15) Installment Sales and Leased Property. Policies covering property sold under conditional contract of sale, partial payment contract, installment sales contract, or leased but excluding motor vehicles designed for highway use. These policies shall cover in transit but may not extend beyond the termination of the seller's or lessor's interest. This subsection is not intended to include machinery and equipment under certain "lease-back" contracts.

(16) Garment contractors floaters.

(17) Furriers or fur storer's customer's policies (that is, policies under which certificates or receipts are issued by furriers or fur storers) covering specified articles the property of customers.

(18) Accounts receivable policies, valuable papers and records policies.

(19) Cold storage locker plant policies, covering merchandise of customers consisting principally of meats, game, fish, poultry, fruit, vegetables, and property of a similar nature.

(20) Floor plan policies, covering property for sale while in possession of dealers under a floor plan or any similar plan under which the dealer borrows money from a bank or lending institution with which to pay the manufacturer, provided:

(a) That:

(i) The merchandise is specifically identifiable as encumbered to the bank or lending institution;

(ii) The dealer's right to sell or otherwise dispose of the merchandise is conditioned upon its being released from encumbrance by the bank or lending institution;

(iii) The policies cover in transit and do not extend beyond the termination of the dealer's interest.

(b) That the policies may not cover automobiles or motor vehicles; merchandise for which the dealer's collateral is the stock or inventory as distinguished from merchandise specifically identifiable as encumbered to the lending institution.

(21) Sign and Street Clock Policies, covering neon signs, automatic or mechanical signs, street clocks, while in use as such.

(22) Inland Marine Policies.

(a) The following policies covering property which, when sold to the ultimate purchaser, may be covered specifically, by the owner, under Inland Marine Policies:

(i) Musical Instrument Dealers' Policies, covering property consisting principally of musical instruments, and their accessories. Radios, televisions, record players and combinations thereof are not deemed musical instruments.

(ii) Camera Dealers' Policies, covering property consisting principally of cameras and their accessories.

(iii) Furrier's Dealers' Policies, covering property consisting principally of fur and fur garments.

(iv) Equipment Dealers' Policies, covering mobile equipment consisting of binders, reapers, tractors, harvesters, harrows, tedders, and other similar agricultural equipment and accessories; construction equipment consisting of bulldozers, road scrapers, tractors, compressors, pneumatic tools, and similar equipment and accessories; but excluding motor vehicles designed for highway use.

(b) These policies may include coverage of tenant assured's interest in improvements and betterments of building and of furniture, fixtures, tools, machinery, patterns, molds, and dies.

(23) Wool Growers' Floaters.

(24) Domestic Bulk Liquids Policies, covering domestic bulk liquids stored in tanks provided the risks of fire and inherent explosion, windstorm, sprinkler leakage, earthquake, hail, explosion, riot, or civil commotion are excluded from the policy.

(25) Furniture Shipment Policies, covering furniture, fixtures, and equipment in bona fide course of shipment from one location to another location of the owner including in place of deposit incident to the transportation while awaiting determination or availability of final destination, in which event they shall cover at time of issuance transportation to or from the place of deposit but may not cover after delivery at destination.

H. Unless otherwise permitted, nothing in the foregoing shall be construed to permit marine or transportation policies to cover:

(1) Storage of assured's merchandise, except as provided above;

(2) Merchandise in course of manufacture, the property of and on the premises of the manufacturer;

(3) Furniture and fixtures and improvements and betterments to buildings;

(4) Merchandise in a permanent location, sold under partial payment, contract of sale, or installment sales contract, which involves protection of the purchaser's interest after seller's interest ceases;

(5) Monies or securities, or both, in safes, vaults, safety deposit vaults, bank or assured's premises, except while in course of transportation;

(6) Risks of fire, windstorm, sprinkler leakage, earthquake, hail, explosion, riot, or civil commotion on buildings, structures, wharves, piers, docks, bulkheads, and sheds and other fixed real property on land or over water, except as provided above.

I. Inland Marine Insurance.

(1) The following property, when owned and used for pleasure and not for business, hire, or other commercial use, shall be classified as Inland Marine Insurance:

(a) Outboard motors, including their equipment and appurtenances;

(b) Rowboats, canoes and boats not exceeding 16 feet in overall length, measured on the centerline and designed exclusively to be propelled by one or more outboard motors;

(c) Equipment and appurtenances, including boat carriers and trailers, used or designed for use with the above.

(2) Coverage of any of the property specified in §I(1) of this regulation in conjunction with vessels not falling within §I(1)(b) need not be classified as inland marine insurance.

Md. Code Regs. 31.08.06.02