Value Reporting Form and Value of Covered Property

April 9, 2012

In the ISO CP 13 10, Value Reporting Form, the full reporting section contains these provisions: “(1) The values you reported for the location where the loss or damage occurred, divided by (2) The value of the Covered Property at that location on the report dates.” What does paragraph (2) mean by “the value”? For example, if the latest statement of values places the value of Building 1 at $1,000,000 on January 1, 2012 (beginning of the annual reporting period), but there is a loss on March 30, 2012, and the value at the time of loss is actually determined to be $1,500,000, does that mean that there is a coinsurance penalty now for Building 1?

The issue I've struggled with is that the second paragraph goes on to state “at that location on the report date.” So, if on the report date the value of the building was actually $1,400,000, and the value of the building at the time of loss was $1,500,000, I would assume the coinsurance would be based on $1,000,000/$1,400,000 and not based on the time of the loss. Correct? In short, what does “the value of Covered Property at that location on the report dates” actually mean?

Am I correct in my interpretation above? In short, the reporting form does not remove the standard coinsurance provision in the policy but appears to simply replace it and make it more pertinent to a statement of values (reporting) rather than a limit of insurance for the property (standard property form).

Ohio Subscriber

You are correct in your interpretation: the value on the report date is used to determine the penalty, not the value on the date of loss. So, if there is an increase in value between reporting periods, the calculation uses the value on the date of the last report even though the value is higher when the loss occurs. Essentially, the provision is stating that the insured will be penalized for under reporting values. But, the insured will not be penalized for fluctuations between reporting periods as the calculation is based on the value provided on the date of the report, not the date of the loss.

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