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Some other wrap-around features to be aware of are:

  • The NYPIUA DP-1 policy should be written at 100 percent of the dwelling's actual cash value

(subject to the maximum limit available) and the homeowners policy should be written at 100 percent of the dwelling's replacement cost.

  • The homeowners policy should not be written with a windstorm deductible.

  • The homeowners policy will be endorsed to coordinate its provisions with the NYPIUA DP-1

policy.

  • The Insurance Department has pre-approved the use of a 55 percent credit on the homeowners

premium to account for the coverage provided by the NYPIUA DP-1 policy.

Wrap-around option No. 2—HO policy wrapped around a RC DP-1 policy The second wrap-around option is like the first, except that the DP-1 policy provided by the NYPIUA is endorsed to insure the dwelling for replacement cost. This option eliminates the dual settlement complications that would occur under the first option, where the wrap-around homeowners policy pays for replacement cost in excess of the DP-1 policy's payment of actual cash value. Under this option, both the DP-1 policy and the homeowners policy should be written at 100 percent of the dwelling's replacement cost (subject to the maximum limit available from NYPIUA).

The Insurance Department has pre-approved the use of a 65 percent credit on the homeowners premium to account for the coverage provided by the NYPIUA DP-1 policy endorsed with the replacement cost valuation. The DP-1 policy will be charged $25 for the replacement cost valuation endorsement.

Wrap-around option No. 3—HO-4 policy combined with an ACV or RC DP-1 policy This third wrap-around option merely adds broad form personal property (contents) coverage and personal liability coverage alongside the dwelling and other structures coverage provided by the NYPIUA DP-1 policy.

HO-4. This wrap-around policy, for example, the ISO Homeowners 4—Contents Broad Form (HO 00 04 10 00) policy, does not supplement coverage for the dwelling and other structures provided by the NYPIUA DP-1 policy. Consequently, coverage for the dwelling and other structures is limited to the eight DP-1 perils (plus vandalism or malicious mischief, if purchased) and all of the inferior elements highlighted above. However, the DP-1 policy may be endorsed with replacement cost valuation by the same means specified under the second option.

The Insurance Department has pre-approved the use of a 25 percent credit on the HO-4 policy premium to account for the ownership factor not contemplated in this renter-priced policy. Also, the building additions and alterations additional coverage will be endorsed off the wrap-around HO-4 policy.

Maximum NYPIUA limits The standard maximum limit offered by NYPIUA for a dwelling is $600,000. However, the NYPIUA Appeals Committee could approve an amount up to $1.5 million, provided certain conditions are met (including a monitored burglar alarm system and, if within 1,500 feet of the shore, special shutters and/or glass). Under options No. 1 and No. 2, the homeowners policy would be excess over the maximum limit payable by the NYPIUA policy.

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