And for what? For insurance-policy exclusions for “flood, surface water, waves, tidal water, overflow of a body of water, or spray from any of these, whether or not driven by wind.” What insured on the planet is expected to understand that “windstorm” coverage only applies if your stuff is actually blown into Oz from Kansas, without the presence of water? And forget the “but that just means the flood policy covers” argument. Insureds know darn good and well what a flood is–rising water from too much rain over too many days. What has that to do with a 30-foot wall of ocean driven onto, over and through their property by–in scientific terms–one mega-honkin' windstorm? And forgive all those folks in New Orleans for thinking that Hurricane Katrina–rather than the resulting flood–was responsible for breaking those levees and releasing the waters that crushed their homes.

Fortunately the solution to this coverage confusion has fallen into our laps. What do all those marketing researchers always say? Listen to your customers! Other businesses spend millions on research to uncover their clients' hidden desires. Here we are with clients coming right out and telling us what they want! We don't even have to pay for a six-month study to help us decide what to name this potential blockbuster product. Let's call it “hurricane coverage”! We can develop a policy or endorsement that simply provides catastrophe coverage when the damages are directly or proximately caused by a named storm. No more flood exclusion. No more “whether or not driven by wind” confusion. If a hurricane rolls ashore, this coverage pays the freight up to policy limits–period. Leave windstorm as a covered peril in standard policies, but replace all the confusing exclusions and limitations meant to address hurricanes with a simple exclusion for damage arising from named storms. Leave flood insurance to cover rising waters inundating a normally dry land area unless resulting from a named storm. Those interested in “named storm” coverage can buy the catastrophe coverage or not–their call.

We seem to think we have to offer policies loaded up with every coverage under the sun. Then we add a ton of limiting and exclusionary language to whittle the coverages back to a reasonable size. Then we threaten to cancel or nonrenew insureds who have the audacity to file claims. It's like we're spreading a feast of candy in front of a child, and then punishing the tyke for eating it. Whenever possible, let's strike a blow for freedom by keeping coverage grants simple and clearly defined. Perhaps it's time to reconsider offering basic forms with specific coverage endorsements from which the insured may pick and choose. A perfect solution? Of course not–just an understandable and clear one.

Suggestion No. 2: Don't build a watch when a sundial will do. Are forms-drafters trying to protect their jobs, running in fear of attorneys or simple smoking some incredibly strong stuff? Far too many policy provisions use confusing fine print when a simple yes or no will do. For example, consider coverage for tapes, records, disks and other media. Just who, pray tell, thinks the way the ISO forms address these items makes sense? On the one hand, the personal auto policy did a good thing in creating a separate exclusion for these items, which is applicable unless the items are used with otherwise covered equipment. That's a much better approach than the homeowners policy's “property not covered” motor vehicle wording, which leads to endless arguments over whether CDs or DVDs amount to “electronic apparatus and accessories designed to be operated solely by power from the electrical system of the 'motor vehicle.'” In an apparent attempt to throw the insured a coverage bone, the policy does say the exclusion applies only “while such property is in or upon the 'motor vehicle.'”

Apparently the intent is to have the auto form cover these items while they are in the auto and the homeowners policy to cover them elsewhere. Fair enough. But then the auto and homeowners policies muddy the water by trying to be too precise, with the homeowners policy attempting to exclude only what the auto policy covers and vice versa. Yet the provisions in the two forms do not match up well, and the resulting grey areas lead to erroneous claims denials and confusion on the part of insureds and insurance folks alike.

Yet hope remains! It turns out that ISO has crafted an endorsement to solve the problem–the PP 0313, Excess Electronic Equipment Coverage form, which provides coverage for these items under the personal auto policy. At last, the literally dozens of CDs and DVDs insureds carry in their vehicles can be adequately insured–all the way up to a massive maximum of $200, with no option for any higher limit! Whooeee! Why didn't the forms drafters just come clean and admit they listen only to eight-track tapes and watch Ernest movies?

To add insult to injury, these evidently under-worked folks spent even more valuable time making sure no insured could take advantage of this generous $200 coverage grant by claiming one cent more than what they've got coming. Here is the actual endorsement wording:

2. An adjustment for depreciation and physical condition will be made in determining actual cash value in the event of a total loss.

3. If a repair or replacement results in better than like kind or quality, we will not pay for the amount of the betterment.

Depreciation? Betterment? What, might that $200 tempt some insured to sneak in a $12 claim for a DVD that might be available used from eBay for $8? Now, there's a good use of an adjuster's time–making sure no one who owned the original “Ten Years After Live at the Fillmore East” doesn't try to sneak in the “reengineered” version as a replacement after a loss.

My “strike a blow for freedom” suggestion is simple. Put the coverage for items where the insured logically expects to find it. Then exclude it everywhere else. For tapes, records, disks and other media, kill all the coverage under the auto policy and eliminate all that “electronic apparatus” and “while such property is in or upon the motor vehicle” verbiage in the homeowners policy. Since the homeowners policy already covers these items everywhere but in the auto, and in some circumstances even there, why not eliminate the confusion and put all the coverage in the homeowners policy? As a bonus, we get rid of that ridiculous $200 auto-policy sublimit and give the recordings the protection of the full homeowners limits!

Providing sensible, straightforward coverage for hurricanes and recording media–examples at opposite ends of the claim spectrum–are but two of the many potentially liberating acts that could make our industry a better place for all. Bring us your tired claimants, yearning to breath free of anger and confusion. Give us your poor adjusters, sick of getting hammered over having to interpret obscure or contradictory policy language. Gather round ye agents, tired of suffering the slings and arrows of E&O threats and misfortunes. Reasonable folks may disagree with these suggestions. Then let them advance their own cause. Let the discussion be joined, as together we strike a blow for truth, justice and our freedom to finally know what we are selling–and our insureds' freedom to finally understand what they are buying!

Let the fireworks begin!