COMMERCIAL INLAND MARINE
LEASED AND FINANCED EQUIPMENT COVERAGE FORM SUMMARY

The words YOU and YOUR refer to the Named Lessee and/or Additional Insured as shown overleaf. The words WE, US, and OUR refer to the Company providing the loss damage waiver.

Words and phases that appear in quotation marks have special meaning. Refer to Section F - DEFINITIONS.

1. Covered Causes of Loss
Covered Causes of Loss means risks of direct physical loss to covered property, unless the loss is excluded in the Exclusions, Section D. of this Coverage Form.

2. Covered Territory
We cover property wherever located within the United States of America.

3. Property Not Covered:
Covered Property does not include:
    a. Waterborne equipment. But, we will pay for loss to Covered Property on ferries operated in connection with railroads or on public ferries operating on scheduled routes.
    b. Contraband, or property in the course of illegal transportation of trade.

B. LIMIT OF INSURANCE
1. The most we will pay for “loss” in each occurrence will be the Insured Value as stipulated overleaf unless overridden by the provisions of clause E2 hereunder.

D. EXCLUSIONS
1. We will not pay for “loss” caused by or resulting from any of the following:
    a. Delay, loss of use, or loss of market, or any other consequential loss.
    b. Obsolescence or depreciation of Covered Property.
    c. Property that is missing, where the only evidence of the “loss” is a shortage disclosed on taking inventory, or other instances where there is no physical evidence to show what happened to the property.
    d. Voluntary parting with any property by you or anyone else to whom you have entrusted the property in induced to do so by any fraudulent scheme, trick, device, or false pretense.
    e.  (1) “Conversion”, “misappropriation”, or “skip”, or
        (2) Dishonest or criminal act by your or your partners, directors, trustees, or authorized representatives;
            (a) Acting alone or in collusion with others; or
            (b) Whether or not occurring during the hours of employment. This exclusion does not apply to acts of your employees.
    f.  (1) Wear and tear.
        (2) Rust, corrosion, fungus, decay, deterioration, hidden or latent defect, or any quality in property that causes it to damage or destroy itself;
        (3) Insects or vermin;
        (4) Mechanical breakdown, including rupture or bursting caused by centrifugal force;
        (5) Breakdown caused by failure to perform regular maintenance;
        (6) Dampness or dryness of atmosphere;
        (7) Changes in or extremes of temperature;
        (8) Marring or scratching;
But if an excluded cause of loss that it listed in D.1.f. results in a Covered of Loss, we will pay for the “loss” caused by that Covered of Loss.
    g. Weather conditions. But this exclusion only applies if weather conditions contribute in any way with a cause or event excluded in paragraph 2. Below to produce the “loss”.

2. We will not pay for “loss” caused directly or indirectly by any of the following. Such “loss” is excluded regardless of any other cause or event that contributes concurrently or in any sequence tot he “loss”.
    a. War and Military Action
        (1) War, including undeclared or civil war.
        (2) Warlike action by a military force, including action in hindering or defending against an actual or expected attack, by any government, sovereign, or other authority using military personnel or other agents; or
        (3) Insurrection, rebellion, revolution, usurped power, or action taken by governmental authority in hindering or defending against any of these.
    b. Governmental Action
Seizure or destruction of property by order of governmental authority.
But we will pay for act of destruction ordered by governmental authority and taken at the time of a fire to prevent its spread if the fire would be covered under this Coverage Form.
    c. Nuclear Hazard
Nuclear reaction or radiation, or radioactive contamination, however caused. But if nuclear reaction or radiation, or radioactive contamination, results in fire, we will pay for the “loss” caused by that fire.
    d. Earth Movement
        (1) Any earth movement (other than sinkhole collapse), such as an earthquake, landslide, mine subsidence, or earth sinking, rising or shifting. But if earth movement results in fire or explosion, we will pay for “loss” caused by that fire or explosion.
        (2) Volcanic eruption, explosion, or effusion results in fire, glass breakage, or volcanic action, we will pay for the “loss” caused by that fire, glass breakage, or volcanic action.
Volcanic action means direct “loss” resulting from the eruption of a volcano when the “loss” is caused by:
            (a) Airborne volcanic blast or airborne shock waves;
            (b) Ash, dust, or particulate matter; or
            (c) Lava flow.
Volcanic action does not include the cost to remove ash, dust, or particulate matter that does not cause direct physical “loss” to the described property.

3. We will not pay for “loss” caused by or resulting from the discharge, dispersal, seepage, migration, release, or escape of “pollutants”.
But if an excluded cause of loss in 3. results in a Covered Cause of Loss, we will pay the “loss” caused by that Covered Cause of Loss.

E. ADDITIONAL CONDITIONS
The following conditions apply in addition to the Commercial Inland Marine Conditions and the Common Policy Conditions. The provisions of the Leased and Financed Equipment Coverage Form shall apply if they conflict with any Commercial Inland Marine Condition or Common Policy Condition.

1. Termination of Coverage
The Common Policy Condition Cancellation provision relating to required written notice to the Named Insured shown overleaf for cancellation other than nonpayment of premium is changed to 90 days.

2. Valuation
The Valuation condition contained in the Commercial Inland Marine Conditions is replaced by the following:
Valuation
    a. For a partial “loss”, the value of property will be the least of the following amounts:
        (1) The cost of reasonably restoring that property to its condition immediately before “loss”;
        (2) The cost of replacing that property with substantially identical property; or
        (3) The “stipulated loss value” of the lost or damaged property.
    b. For a total, or constructive total “loss”, the value of the property will be the greater of the following amounts:
        (1) The “stipulated loss value” of the lost or damaged property; or
        (2) The cost of replacing that property with substantially identical property, but not more than the lesser of:
            (a) The original invoice amount paid by you for the affected Covered Property; or
(            b) The actual cash value of the affected Covered Property.
    c. In the Event of “loss”:
        (1) The value of property will be determined as of the time of “loss”; and
        (2) Out Claims Department will determine whether the “loss” is partial or total.
    d. You may make a claim for “loss” covered by this insurance of an actual cash value basis instead of on a replacement cost basis.
In the event you elect to have “loss” settled on an actual cash value basis, you may still make a claim for the additional coverage the replacement cost coverage provides if you notify us of your intent to do so within 180 days after the “loss”.
    e. We will not pay on a replacement cost for any “loss”:
        (1) Until the lost or damaged property is actually repaired or replaced; and
        (2) Unless the repairs or replacement are made as soon as reasonably possible after the “loss”.
    f. We will not pay more for “loss” on a replacement cost basis than the least of:
        (1) The Insured Value of the lost or damaged property;
        (2) The cost to replace the lost or damaged property with other property:
            (a) Of comparable material and quality; and
            (b) Used for the same purpose; or
        (3) The amount you actually spend that is necessary to repair or replace the lost or damaged property.

3. Additional Duties in the Event of Loss to Covered Property
    a. We require that you take all reasonable steps to protect the Covered Property from further damage in the event of “loss” to Covered Property.
    b. If you intentionally fail to take such steps, we will not pay for any further “loss” that may result.
    c. We will reimburse you for such reasonable expenses incurred to prevent “loss”.
    d. You must comply with all other Duties In The Event of Loss - Conditions in the Commercial Inland Marine Conditions.
    e. If you do not furnish to us or our agent all things required by all applicable conditions, we will not pay for any “loss” related thereto.

4. Impairment of Recovery Rights
If any act or agreement by you (before or after a “loss”), impairs your right to recover from others, we will not cover the “loss”, nor will we cover any “loss” which you settle or comprise without our written consent.

5. Reinstatement of Limit after Loss
That part of the Commercial Inland Marine Loss Condition tilted as above is revised by deleting the provision for refund of unearned premium after total “loss” of a scheduled item.

6. Conformity to Statute
Any terms of this Coverage Form that are in conflict with the laws of the state in which it is issued are changed to conform to such laws.

F. DEFINITIONS

1. “Conversion” means any transfer of ownership of Covered Property by you or any of your partners, directors, trustees or authorized representatives; for the benefit of any or all.

2. “Loss” means accidental loss or damage.

3. “Misappropriation” means any wrongful appropriation of Covered Property.

4. “Pollutants” means any solid, liquid, gaseous, or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals, and waste. Waste includes material to be recycled, reconditioned, or reclaimed.

5. “Skip” means the disappearance of the Covered Property, along with you, your partners, directors, trustees or authorized representatives.

6. “Stipulated Loss Value” is the sum of:
    a. All lease or finance payments due and payable for the affected Covered Property;
    b. All future lease or finance payments for the affected Covered Property, discounted to present value at the rate stated in the lease or finance agreement; and
    c. The residual value, if any, of the affected Covered Property as stated in the lease or finance agreement.
It is agreed that the “stipulated loss value” may exceed the original invoice amount paid by you for the affected Covered Property.

7. “Theft” means any act of stealing.

8. “Void” means the rescission of coverage under the policy so that there was never any coverage in force and effect.

NOTE

Coverage under this Loss Damage Waiver is an extension of coverage to include the lessee of rental equipment specified hereon. No alternation of coverage terms and conditions is intended or implied. The lessee agrees that disclosure of the terms and conditions, herein stated, is the full disclosure of the Loss Damage Waiver benefits that will be available for a covered cause of loss.