California Code of Regulations
Title 10 - Investment
Chapter 5 - Insurance Commissioner
Subchapter 4.10 - Rates for Credit Property Insurance and Credit Unemployment Insurance
Article 4 - Benchmark Programs for Credit Property Insurance
Section 2670.14 - Benchmark Number Three: Provisions for Dual Interest Credit Property Insurance on a Closed End Loan Secured by Personal Property

(a) When Coverage Is In Effect. Coverage is in effect for the term of years set forth in the certificate of insurance, from 12:01 a.m. on the effective date of coverage to 12:01 a.m. on the expiration date of coverage.

(b) Coverage Provided. The insurance covers the interest of the master policy holder and the certificate holder in personal property pledged as security for a closed end loan made by the master policy holder to the certificate holder, which property is specifically described in the security agreement.

(c) Perils Insured. The insurance provides coverage for loss or damage caused by fire and lighting; and collision or overturn, stranding, sinking, burning, or derailment, while the insured property is in transit. Extended coverage covers loss or damage due to: windstorm, cyclone, tornado, hail, rising water, tidal wave, overflow of water, earthquake, collapse of bridges, falling objects, or explosion; riot, riot attending a strike and civil commotion; aircraft or private passenger type vehicles; smoke; flood; collapse of building; rupture, cracking, burning or freezing of plumbing, heating or air conditioning systems and domestic appliances except for water heaters; and robbery or burglary with evidence of forced entry.

(d) Exclusions. Loss or damage due to: decay, wet or dampness, or by being marred, scratched, spotted, discolored, moldy, rusted or rotted unless the same is the direct result of a peril insured against; frost, cold weather, ice, snow or sleet; motor vehicles, land conveyances, farm equipment, aircraft or boats unless this coverage is provided; deterioration unless it results from insured perils; defective manufacturing, mechanical or electrical breakdown; the certificate holder's neglect of the property during and after any covered loss to the extent of the certificate holder's neglect; hostile or warlike action by any government or sovereign power, legal or actual, or their military authority or agent or by any armed forces; action taken by governmental authority in hindering, combating, or defending against such an occurrence; by nuclear reaction, nuclear radiation, or radioactive contamination; to all forms of money or instruments; or to television antennas and outside wiring.

(e) Limit of Liability. The insurer's limit of liability for loss or damage in the event of a partial loss will be equal to the actual cash value of the insured property, not to exceed the cost to repair or replace the insured property with property of like kind or quality. The insurer's limit of liability in the event of a total loss will be equal to the lesser of the actual cash value of the insured property or the original amount of insurance. Coverage will not exceed the maximum limit of liability stated in the certificate of insurance.