Forms

AUTO CLUB FAMILY
INSURANCE COMPANY
12901 NORTH FORTY DRIVE
ST. LOUIS, MISSOURI 63141
(314) 523-7350

THIS POLICY BOOKLET, WITH THE DECLARATIONS CERTIFICATE AND ENDORSEMENTS, IF ANY, ISSUED TO FORM A PART THEREOF, COMPLETES THIS POLICY.

We will provide the insurance described in this policy in return for the premium and compliance with all applicable provisions of this policy.

In this policy, you an your refer to the named insured shown in the Declaration and the spouse if a resident of the same household. We, us and our refer to the Company providing this insurance. In addition, certain words and phrases are defined as follows:

1. Bodily injury means bodily harm, sickness or disease, including required care, loss of services and death that results.

8. Residence premises means the unit where you reside and which is shown as the residence premises in the Declarations.

1. Others while the property is on the part of the residence premises occupied by an insured; or

2. A guest or a residence employee, while the property is in any residence occupied by an insured.

Our limit of liability for personal property usually located at an insured's residence, other than the residence premises, is 10% of the limit of liability for Coverage C, or $1000, whichever is greater. Personal property in a newly acquired principal residence is not subject to this limitation for the 30 days from the time you begin to move the property there.

Special Limits of Liability. These limits do not increase the Coverage C limit of liability. The special limit for each numbered category below is the total limit for each loss for all property in that category.

1. $200 on money, bank notes, bullion, gold other than goldware, silver other than silverware, platinum, coins and medals.

2. $1000 on securities, accounts, deeds, evidences of debt, letters of credit, notes other than bank notes, manuscripts, personal records, passports, tickets and stamps. This dollar limit applies to these categories regardless of the medium (such as paper or computer software) on which the material exists.

This limit includes the cost to research, replace or restore the information from the lost or damaged material.

3. $1000 on watercraft, including their trailers, coverings, furnishings, equipment and outboard engines or motors.

5. $1000 for loss by theft of jewelry, watches, furs, precious and semi-precious stones.

ware, goldware, gold-plated ware and pewterware. This includes flatware, hollowware, tea sets, trays and trophies made of or including silver, gold or pewter.

8. $2500 on property, on the residence premises, used at any time or in any manner for any business purpose.

9. $250 on property, away from the residence premises, used at any time or in any manner for any business purpose. However, this limit does not apply to loss to adaptable electronic apparatus as described in Special Limits 10. and 11. below.

10. $1000 for loss to electronic apparatus, while in or upon a motor vehicle or other motorized land conveyance, if the electronic apparatus is equipped to be operated by the power from the electrical system of the vehicle or conveyance while retaining its capability of being operated by other sources of power.

Electronic apparatus includes:

a. Accessories or antennas; or
b. Tapes, wires, records, discs or other media;
for use with any electronic apparatus described in this item 10.

11. $1000 for loss to electronic apparatus, while not in or upon a motor vehicle or other motorized land conveyance, if the electronic apparatus:

     a. Is equipped to be operated by power from the electrical system of the vehicle or conveyance while retaining its      capability of being operated by other sources of power;
     b. Is away from the residence premises; and
     c. Is used at any time or in any manner for any business purpose.

Electronic apparatus includes:

a. Accessories or antennas; or
b. Tapes, wires, records, discs or other media;
for use with any electronic apparatus described in this item 11.

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Property Not Covered. We do not cover:

1. Articles separately described and specifically insured in this or other insurance;

2. Animals, birds, or fish;

3. Motor vehicles or all other motorized land conveyances. This includes:

a. Their equipment and accessories; or
b. Electronic apparatus that is designed to be operated solely by use of the power from electrical system of motor vehicles or all other motorized land conveyances. Electronic apparatus includes:

(1) Accessories or antenna; or
(2) Tapes, wires, records, discs or other media;

or use with any electronic apparatus described in this item 3.b.

The exclusion of property described in 3.a. and 3.b. above applies only while the property is in or upon the vehicle or conveyance.

We do cover vehicles or conveyances not subject to motor vehicle registration which are:

a. Used to service the insured's residence; or
b. Designed for assisting the handicapped;

4. Aircraft and parts. Aircraft means any contrivance used or designed for flight, except model or hobby aircraft not used or designed to carry people or cargo;

5. Property of roomers, boarders and other tenants, except property of roomers and boarders related to an insured;

6. Property in an apartment regularly rented or held for rental to others by an insured;

7. Property rented or held for rental to others off the residence premises;

8. Business data, including such data stored in:

a. Books of account, drawings or other paper records; or

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b. Electronic data processing tapes, wires, records, discs or other software media.

However, we do cover the cost of blank recording or storage media and pre-recorded computer programs available on the retail market; or

9. Credit cards or fund transfer cards except as provided in Additional Coverages 6.

COVERAGE D - Loss of Use

The limit if liability for Coverage D is the total limit for all the coverages that follow.

1. If a loss by a Peril Insured Against under this policy to covered property or the building containing the property, makes the residence premises not fit to live in, we cover, at your choice, either of the following. However, if the residence premises is not your principal place of residence, we will not provide the option under paragraph b. below:

a. Additional Living Expense, meaning any necessary increase in living expenses incurred by you so that your household can maintain its normal standard of living; or

b. Fair Rental Value, meaning the fair rental value of that part of the residence premises where you reside less any expenses that do not continue while the premises is not fit to live in.

Payment under a. or b. will be for the shortest time required to repair or replace the damage or, if you permanently relocate, the shortest time required for your household to permanently relocate elsewhere.

2. If a loss covered under this Section makes that part of the residence premises rented to other or held for rental by you not fit to live in, we cover the:

Fair Rental Value, meaning the fair rental value if that part of the residence premises rented to others or held for rental by you less any expenses that do not continue while the premises is not fit to live in.

Payment will be for the shortest time required to repair or replace that part of the premises rented or held for rental.

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3. If a civil authority prohibits you from use of the residence premises as a result of direct damage to neighboring premises by a Peril Insured Against in this policy, we cover the additional Living Expense and Fair Rental Value loss provided under 1. and 2. above for no more than two weeks.

The periods of time under 1., 2. and 3. above are not limited by expiration of this policy.

We do not cover loss or expense due to cancellation of a lease or agreement.

ADDITIONAL COVERAGES

1. Debris Removal. We will pay your reasonable expense for the removal of:

a. Debris of covered property if a Peril Insured Against, that applies to the damaged property, causes the loss; or

b. Ash, dust or particles from a volcanic eruption that has caused direct loss to a building or property contained in a building.

This expense is included in the limit if liability that applies to the damaged property. If the amount to be paid for the actual damage to the property plus the debris removal expense is more than the limit of liability for the damaged property, an additional 5% of that limit of liability is available for debris removal expense.

We will also pay your reasonable expense, up to $500, for the removal from the residence premises of:

a. Your tree(s) felled by the peril of Windstorm or Hail:

b. Your tree(s) felled by the peril of Weight of Ice, Snow or Sleet; or

c. A neighbor's tree(s) felled by a Peril Insured Against under Coverage C;

provided the tree(s) damages a covered structure. The $500 limit is the most we will pay in any one loss beardless of the number of fallen trees.

2. Reasonable Repairs. In the event that covered property is damaged by an applicable Peril Insured Against,

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we will pay the reasonable cost incurred by you for necessary measures taken solely to protect against further damage. If the measures taken involve repair to other damaged property, we will pay for those measures only if that property is covered under this policy and the damage to that property is caused by an applicable Peril Insured Against.

This coverage:

a. Does not increase the limit of liability that applies to the covered property;

b. Does not relieve you of your duties, in case of a loss to covered property, as set forth in SECTION 1 - CONDITION 2.d.

3. Trees, Shrubs and Other Plants. We cover trees, shrubs, plants or lawns, on the residence premises, for loss caused by the following Perils Insured Against: Fire or lightening, Explosion, riot or civil commotion, Aircraft, Vehicles not owned or operated by a resident of the residence premises, Vandalism or malicious mischief or theft.

We will pay up to 10% of the limit of liability that applies to Coverage C, for all trees, shrubs, plants or lawns. No more than $500 of this limit will be available for any one tree, shrub or plant, We do not over property grown for business purposes.

This coverage is additional insurance.

4. Fire Department Service Charge. We will pay up to $500 for your liability assumed by contract or agreement for fire department charges incurred when the fire department is called to save or protect covered property from a Peril Insured Against. We do not cover fire department services charges if the property is located within the limits of the city, municipality or protection district furnishing the fire department response.

This coverage is additional insurance. No deductible applies to this coverage.

5. Property Removed. We insure covered property against direct loss from any cause while being removed

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from a premises endangered by a Peril Insured Against and for no more than 30 days while removed. This coverage does not change the limit of liability that applies to the property being removed.

6. Credit Card, Fund Transfer Card, Forgery and Counterfeit Money.
We will pay up to $500 for:

a. The legal obligation of an insured to pay because of the theft or unauthorized use of a credit cards issued to or registered in an insured's name;

b. Loss resulting from theft or unauthorized use of a fund transfer card used for deposit, withdrawal or transfer of funds, issued to or registered in an insured's name;

c. Loss to an insured caused by forgery or alteration of any check or negotiable instrument; and

d. Loss to an insured though acceptance in good faith of counterfeit United States of Canadian paper currency.

We do not cover use of a credit card or fund transfer card:

a. By a resident of your household;

b. By a person who has been entrusted with either type of card; or

c. If an insured has not complied with all ternms and conditionsa under wwhich the cards are issued.

All loss resulting form a series of acts committed by any one person or in which any one person is concerned or implicated is considered to be one loss.

We do not cover loss arising out of business use or dishonesty of an insured or an employee of an insured.

This coverage is additional insurance. No deductible applies to this coverage.

Defense:

a. We may investigate and settle any claim or suit that we decide is appropriate. Our duty to defend a claim or suit ends when the amount we pay for the loss equals our limit of liability.

b. If suit is brought against an insured for liability under the Credit Card of Fund Transfer Card

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coverage, we will provide a defense at our expense by counsel of our choice, subject to a. above.

c. We have the option to defend at our expense an insured or an insured's bank against any suit for the enforcement of payment under the Forgery coverage.

7. Loss Assessment. We will pay up to $1000 for your share of loss assessment charged during the policy period against you by a corporation or association of property owners, when the assessment is made as a result of direct loss to the property, owned by all members collectively, caused by a Peril Insured Against under COVERAGE A - DWELLING, other than earthquake or land shock waves or tremors before, during or after a volcanic eruption.

This coverage applies only to loss assessments charged against you as owner or tenant of the residence premises.

We do not cover loss assessments charged against you or a corporation or association of property owners by any governmental body.

The limit of $1000 is the most we will pay with respect to any one loss, regardless of the number of assessments.

Condition 1. Policy Period, under SECTIONS I AND II - CONDITIONS, does not apply to this coverage.

8. Collapse. We insure for direct physical loss to covered property involving collapse of a building or any part of a building caused by one or more of the following:

     a. Perils Insured Against in COVERAGE C - PERSONAL PROPERTY. These perils apply to covered      buildings and personal property for loss insured by this additional coverage;
     b. Hidden decay;
     c. Hidden insect or vermin damage;
     d. Weight of contents, equipment, animal or people;
     e. Weight of rain which collects on a roof; or
     f. Use of defective material or methods in construction, remodeling or renovation if the collapse occurs during the      course of the construction, remodeling or renovation.

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Loss to an awning, fence, patio, pavement, swimming pool, underground pipe, flue, drain, cesspool, septic tank, foundation, retaining wall, bulkhead, pier, wharf or dock is not included under items b., c., d., e. and f. unless the loss is a direct result of the collapse of a building.

Collapse does not include settling, cracking, shrinking, bulging or expansion.

This coverage does not increase the limit of liability applying to the damaged covered property.

9. Glass or Safety Glazing Material

Loss to glass covered under this ADDITIONAL COVERAGE 9. will be settled on the basis of replacement with safety glazing materials when required by ordinance or law.

This coverage does not increase the limit of liability that

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applies to the damaged property.

10. Ordinance or Law.

a. You may use up to 10% of the limit of liability that applies to COVERAGE A for the increased costs you insure due to the enforcement of any ordinance or law which requires or regulates:

(1) The construction, demolition, remodeling, renovation or repair of that part of a covered building or other structure damaged by a PERIL INSURED AGAINST;

(2) The demolition and reconstruction of the undamaged part of a covered building or other structure, when that building or other structure must be totally demolished because of damage by a PERIL INSURED AGAINST to another part of that covered building or other structure; or

(3) The remodeling, removal or replacement of the portion of the undamaged part of a covered building or other structure necessary to complete the remodeling, repair or replacement of that part of the covered building or other structure damaged by a PERIL INSURED AGAINST.

b. You may use all or part of this ordinance or law coverage to pay for the increased costs you incur to remove debris resulting form the construction, demolition, remodeling, renovation, repair or replacement of property as stated in a. above.

c. We do not cover:

(1) The loss in value to any covered building or other structure due to the requirements of any ordinance or law; or

(2) The costs to comply with any ordinance or law which requires any insured or others to test for, monitor, clean up, remove, contain, treat, detoxify, or neutralize, or in any way respond to, or assess the effects of, pollutants on any covered building or other structure.

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

This coverage is additional insurance.

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SECTION I - PERILS INSURED AGAINST

We insure for direct physical loss to the property described in Coverages A and C caused by a peril listed below unless the loss is excluded in SECTION I - EXCLUSIONS.

1. Fire or lightning.

2. Windstorm or hail. This peril does not include loss to the inside of a building or the property contained in a building caused by rain, snow, sleet, sand or dust unless the direct force of wind or hail damages the building causing an opening in a roof or wall and the rain, snow, sleet, sand or dust enters though this opening.

This peril includes loss to watercraft and their trailers, furnishings, equipment, and outboard engines or motors, only while inside a fully enclosed building.

3. Explosion.

4. Riot or civil commotion.

5. Aircraft, including self-propelled missiles and spacecraft.

6. Vehicles. This peril does not include loss to a fence, driveway or walk caused by a vehicle owned or operated by a resident of the residence premises.

7. Smoke, meaning sudden and accidental damage from smoke.

This peril does not include loss caused by smoke from agricultural smudging or industrial operations.

8. Vandalism or malicious mischief. This peril does not include loss to property on the residence premises if the dwelling has been vacant or unoccupied for more than 30 consecutive days immediately before the loss. A dwelling being constructed is not considered vacant.

9. Theft, including attempted theft and loss of property form a known place when it is likely that the property has been stolen.

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This peril does not include loss caused by theft;

a. Committed by an insured;

b. In or to a dwelling under construction, or of materials and supplies for use in the construction until the dwelling is finished and occupied; or

c. Form that pert of a residence premises rented by an insured to other than an insured.

This peril does not include loss caused by theft that occurs off the residence premises of:

a. Property while at any other residence owned by, rented to or occupied by an insured, except while an insured is temporarily living there. Property of a student who is an insured is covered while living away from home if the student has been there at any time during the 45 days immediately before the loss;

b. Watercraft, and their furnishings, equipment and outboard engines or motors; or

c. Trailers and campers.

10. Falling objects. This peril does not include loss to the inside of a building or property contained in the building unless the roof or an outside wall of the building is first damaged by a falling object. Damage to the falling object itself is not included.

11. Weight of ice, snow or sleet which causes damage to a building or property contained in the building.

This peril does not include loss to an awning, fence, patio, pavement, swimming pool, foundation, retaining wall, bulkhead, pier, wharf or dock.

12. Accidental discharge or overflow of water or steam from within a plumbing, heating, air conditioning or automatic fire protective sprinkler system or form within a household appliance. We also pay for tearing out and replacing any part of the building which is covered under Coverage A and on the residence premises if necessary to repair the system or appliance from which the water or steam escaped.

This peril does not include loss:

a. On the residence premises, if the dwelling has been vacant for more than 30 consecutive days

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immediately before the loss. A dwelling being constructed is not considered vacant.

b. To the system or appliance from which the water or steam escaped;

c. Caused by or resulting from freezing except as provided in the peril of freezing below; or

d. On the residence premises caused by accidental discharge or overflow which occurs off the residence premises.

In this peril, a plumbing system does not include a sump, sump pump or related equipment.

13. Sudden and accidental tearing apart, cracking, burning or bulging of a steam or hot water heating system, an air conditioning or automatic fire protective sprinkler system, or an appliance for heating water.

This peril does not include loss caused by or resulting from freezing except as provided in the peril of freezing below.

14. Freezing of a plumbing, heating, air conditioning or automatic fire protective sprinkler system or of a household appliance.

This peril does not include loss on the residence premises while the dwelling is unoccupied, unless you have used reasonable care to:

a. Maintain heat in the building; or

b. Shut off the water supply and drain the system and appliances of water.

15. Sudden and accidental damage from artificially generated electrical current. This peril does not include loss to a tube, transistor or similar electronic component.

16. Volcanic eruption other than loss caused by earthquake, land shock waves or tremors.

SECTION I - EXCLUSIONS

We do not insure for loss caused directly or indirectly by any of the following, Such loss is excluded regardless of any other cause or event contributing concurrently or in any

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sequence to the loss.

1. Ordinance or Law, meaning any ordinance or law:

     a. Requiring or regulating the construction, demolition, remodeling, revocation or repair of property, including      removal of any resulting debris. This exclusion 1.a. does not apply to the amount of coverage that may be      provided for under ADDITIONAL COVERAGES, Glass or Safety Glazing Material or Ordinance or Law;
     b. The requirements of which result in al loss in value to property; or
     c. Requiring any insured or other to test for, monitor, clean up, remove, contain, treat, detoxify or neutralize, or in      any way respond to, or assess the effects of pollutants.

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

This exclusion applies whether or not the property has been physically damaged.

2. Earth Movement, meaning earthquake including land shock waves or tremors before, during or after a volcanic eruption; landslide; mine subsidence; mudflow; earth sinking; rising or shifting; or any earth movement caused by man or man-made forces unless direct loss by:

a. Fire; or
b. Explosion;

ensues and then we will pay only for the ensuing loss.

This exclusion does not apply to loss by theft.

3. Water damage, meaning:

a. Flood, surface water, waves, tidal water, overflow of a body of water, or spray from any of these, whether or not driven by wind;

b. Water which backs up through sewers or drains or which overflows from a sump; or

c. Water below the surface of the ground, including water which exerts pressure on or seeps or leaks

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through a building, sidewalk, driveway, foundation, swimming pool or other structure,

Direct loss by fire, explosion or theft resulting from water damage is covered.

4. Power failure, meaning the failure of power or other utility service if the failure takes place off the residence premises. But, if the failure of power or other utility service results in a loss, from a Peril Insured Against on the residence premises, we will pay for the loss or damage caused by that PERIL INSURED AGAINST.

5. Neglect, meaning neglect of the insured to use all reasonable means to save and preserve property at and after the time of a loss.

6. War, including the following and any consequence of any of the following:

a. Undeclared war, civil war, insurrection, rebellion or revolution;

b. Warlike act by a military force or military personnel; or

c. Destruction, seizure or use for a military purpose.

Discharge of a nuclear weapon will be deemed a warlike act even if accidental.

7. Nuclear Hazard, to the extent set forth in the Nuclear Hazard Clause of SECTION I - CONDITIONS.

8. Intentional Loss, meaning any loss arising out of any act committed:

a. By or at the expressed or implied direction of any insured; and

b. With the intent to cause a loss.

SECTION I - CONDITIONS

1. Insurable Interest and Limit of Liability. Even if more than one person has an insurable interest in the property covered, we will not be liable in any one loss:

a. To any insured for more than the amount of the insured's interest at the time of loss; or

b. For more than the applicable limit of liability.

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2. An Insured's Duties After Loss. In case of a loss to covered property, you must see that the following duties are complied with. We have no duty or obligation to provide any coverage under this policy unless you or any insured making a claim under this policy have fully complied with the following conditions and duties:

a. Give prompt notice to us;

b. Notify the police in case of loss by theft;

c. Notify the credit card or fund transfer card company in case of loss under Credit Card or Fund Transfer Card coverage;

d. Protect the property from further damage. If repairs to the property are required, you must:

(1) Make reasonable and necessary repairs to protect the property; and
(2) Keep an accurate record or repair expenses;

e. Prepare and submit to us within 60 days of the loss an inventory of damaged personal property using the forms we provide showing the quantify, description, place of purchase, date of purchase, original cost, actual cash value, replacement cost and amount you are claiming as a loss. You must attach all bills, receipts and related documents that justify the figures in the inventory;

f. As often as we reasonably require:

(1) Show the damaged property;

(2) Provide us with the records and documents we request and permit us to make copies; and

(3) Any insured must submit to examination under oath, as often as we may reasonably request, while not in the presence of any other insured, and sign the same;

g. Send to us, within 60 days after our request, your signed, sworn proof of loss, using the form we provide, which sets forth, to the best of your knowledge and belief:

(1) The time and cause of loss;

(2) The interest of the insured and all other in the property involved and all liens on the property;

(3) Other insurance which may cover the loss;

(4) Changes in title or occupancy of the property during the term of the policy;

(5) Specifications of damaged buildings and detailed repair estimates;

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          (6) The inventory of damaged personal property described in 2.e. above;
          (7) Receipts for additional living expenses incurred and records that support the fair rental value loss; and
          (8) Evidence or affidavit that supports a claim under the Credit Card, Fund Transfer Card, Forgery and           Counterfeit Money coverage, stating the amount and cause of loss.
     h. All insureds must help us and cooperate with us in the investigation of any claim presented under this policy.

3. Loss Settlement. Covered property losses are settled as follows:

a. Personal property at actual cash value at the time of loss but not more than the amount required to repair or replace.
b. Coverage A- Dwelling:

(1) If the damage is repaired or replaced within a reasonable time, at the actual cost to repair or replace;
(2) If the damage is not reaired or replaced within a reasonable time, at actual cash valuie but not more than the amount required to repair or replace.

4. Loss to a Pair or Set. In case of loss to a pair or set we may elect to:

a. Repair or replace any part to restore the pair or set to its value before the loss.
b. Pay the difference between actual cash value of the property before and after the loss.

5. Glass replacement. Loss for damage to glass caused by a Peril Insured Against will be settled on the vasis of replacement with safety glazing materials when required by ordinance or law.

6. Appraisal. If you and we fail to agree on the amount of loss, and any insured claiming coverage has complied with all other conditions of the policy, either may demand an appraisal of the loss in writing. If both parties agree in writing to appraisal, and to be bound by the results, each party will choose a competent and disinterested appraiser

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within 20 days after receiving a written request from the other. The two appraisers will choose a disinterested and impartial umpire. If they connot agree upon an umpire within 15 days, you or we, upon written notice to the other, may request that the choice bemade by a judge of a court of record in the state where the residence premises is located. The appraisers shall separately set the amount of the loss as defined in the policy. If the appraisers submit a written report of an agreement to us, the amount agreed upon will be the amount of loss. If they fail to agree, they will submit their differences to the umpire. A decision agreed by any two will set the amount of loss.

Each party will:
a. Pay its own appraiser; and
b. Bear the other expenses of the appraisal and umpire equally.

7. Other Insurance. If a loss covered by this policy is also covered by other insurance, except insurance in the name of a corporation or association of property owners, wewill pay only the proportion of the loss that the limit of liability that applies under this policy bears to the total amount of insurance covering the loss.

If, at the time of loss, there is other insurance in the name of a corporation or association of property owners covering the same property covered by this policy, this insurance will be excess over the amount recoverable under such other insurance.

8. Suit Against Us. No action can be brought unless the policy provisions have been fully complied with and the action is started within one year after the date of loss.

9. Our Option. If we give you written notice within 30 days after we receive your signed, sworn proof of loss, we may repair or replace any part of the damaged property with like property, at our option.

10. Loss Payment. We will adjust all losses with you. We will pay you unless some other person is named in the policy or is legally entitled to receive payment. Loss will be payable 60 days after we receive your proof of loss, all conditions of the policy of insurance have been complied

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with and:

     a. We reach an agreement with you;
     b. There is an entry of a final judgment; or
     c. There is a filing of an appraisal award with us.

11. Abandonment of Property. We need not accept any property abandoned by an insured.

12. Mortgage Clause. The word mortgagee includes trustee.

If a mortgagee is named in this policy, any loss payable under Coverage A - Dwelling will be paid to the mortgagee and you, as interests appear. If more than one mortgagee is named, the order of payment will be the same as the order of precedence of the mortgages.

If we deny your claim, that denial will not apply to a valid claim of the mortgagee, if the mortgagee:

     a. Notifies us in writing of any change in ownership, occupancy or substantial change in risk of which the      mortgagee is aware;
     b. Pays any premium due under the policy on demand if you have neglected to pay the premium; and
     c. Submits a signed, sworn statement of loss within 60 days after receiving notice from us of your failure to do so.      Policy conditions relating to An Insured's Duties After Loss, Apraisal, Suit Against Us and Loss Payment apply to      the mortgagee.

If we decide to cancel or not to renew this policy, the mortgagee wil be notified at least 10 days before the date cancellation or nonrenewal takes effect.

If we pay the mortgagee for any loss and deny payment to you:

a. We are subrogated to all the rights of the mortgagee granted under the mortgage on the property; or
b. At our option, we may pay to the mortgagee the whole principal on the mortgage plus any accrued interest. In this event, we will receive a full assignment and transfer of the mortgage and all securities held as collateral to the mortgage debt.

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Subrogation will not impair the right of the mortgagee to recover the full amount of the mortgagee's claim.

13. No Benefit to Bailee. We will not recognize any assignment or grant any coverage that benefits a person or organization holding, storing or moving property for a fee regardless of any other provision of this policy.

14. Nuclear Hazard Clause.

     a. Nuclear Hazard means any nuclear reaction, radiation or radioactive contamination, all whether controlled or      uncontrolled or however caused, or any consequence of any of these.
     b. Loss caused by the nuclear hazard will not be considered loss caused by fire, explosion or smoke, whether      these perils are specifically named in or otherwise included within the Perils Insured Against in Section I.
     c. This policy does not apply under Section I to loss caused directly or indirectly by nuclear hazard, except that      direct loss by fire resulting from the nuclear hazard is covered.

15. Recovered Property. If you or we recover any property for which we have made payment under this policy, you or we will notify the other of the recovery. At your option, the property will be returned to or retained by you or it will become our property. If the recovered property is returned to or retained by you, the loss payment will be adjusted based on the amount you received for the covered property.

16. Volcanic Eruption Period. One or more volcanic eruptions that occur within a 72-hour period will be considered as one volcanic eruption.

SECTION II - LIABILITY COVERAGES

COVERAGE E-PERSONAL LIABILITY
If a claim is made or a suit is brought against an insured for damages because of bodily injury or property damage caused by an occurrence to which this coverge applies, we will:

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1. Pay up to our limit of liability for the damages for which the insured is legally liable. Damages include prejudgment interest awarded against the insured; and

2. Provide a defense at our expense by counsel of our choice, even if the suit is groundless, false or fraudulent. We may investigate and settle any claim or suit that we decide is appropriate. Our duty to settle or defend ends when the amount we pay for damages resulting from the occurrence equals our limit of liability.

Coverage F - Medical Payments to Others
We will pay the necessary medical expenses that are incurred or medically ascertained within three years from the date of an accident causing bodily injury. Medical expenses means reasonable charges for medical, surgical,
x-ray, dental, ambulance, hospital, professional nursing, prosthetic devices andfuneral services. This coverage does not apply to you or regular residents of your household except residence employees. As to others, this coverage applies only:

1. To a person on the insured locaton with the permission of an insured; or

2. To a person off the insured location, if the bodily injury:

     a. Arises out of a condition on the insured location or the ways immediately adjoining;
     b. Is caused by the activities of an insured;
     c. Is caused by a residence employee in the course of the residence employee's employment by an insured;      or
     d. Is caused by an animal owned by or in the cae of an insured.

SECTIION II - EXCLUSIONS

1. Coverage E-Personal Liability and Coverage F-Medical Payments to Others do not apply to bodily injury or property damage:

a. Which is expected or intended by one or more insureds;
b. Arising out of or in connection with a business

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engaged in by an insured. This exclusion applies but is not limited to an act or omision, regardless of its mature or circumstance, involving a service or duty rendered, promised, owed or implied to be provided because of the nature of the business.
c. Arising out of the rental or holding for rental of any part of any premises by an insured. This exclusion does not apply to the rental or holding for rental of an insured location:

          (1) On an occasional basis if used only as a residece:
          (2) In part for use only as a residence, unless a single family unit is intended for use by the occupying family to           lodge more than two roomers or boarder; or
          (3) In part, as an office, school, studio or private garage;

d. Arising out of the rendering of or failure to render professional services;
e. Arising out of a premises:

          (1) Owned by an insured;
          (2) Rented to an insured; or
          (3) Rented to others by an insured;
          that is not an insured location;

f. Arising out of:

          (1) The ownership, maintenance, use, loading or unloading of any motor vehicles or all other motorized land           conveyances, including trailers, owned or operated by or rented or loaned to an insured;
          (2) The entrustment by an insured of any motor vehicle or any other motorized land conveyance to any           person; or
          (3) Vicarious liability, whether or not statutorily imposed, for the actions of a child or minor using a vehicle or           conveyance excluded in paragraph (1) or (2) above.

This exclusion does not apply to:

(1) A trailer not towed by or carried on a motorized land conveyance.
(2) A motorized land conveyance designed for recreational use off public roads, not subject to motor vehicle registration and:

(a) Not owned by an insured; or

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(b) Owned by an insured and on an insured location;

(3) A motorized golf cart when used to play golf on a golf course;
(4) A vehicle or conveyance not subject to motor vehicle registration which is:

               (a) Used to service an insured's residence;
               (b) Designed for assisting the handicapped; or
               (c) In dead storage on an insured location;

g. Arising out of;

          (1) The ownership,maintenance, use, loading or unloading of an excluded watercraft described below;
          (2) The entrustment by an insured of an excluded watercraft described below to any person; or
          (3) Vicarious liability, whether or not statutorily imposed, for the actions of a child orminor using an excluded           watercraft described below.

Excluded watercraft are those that are principally designed to be propelled by engine power or electric motor, or are sailing vessels, whether owned by or rented to an insured. This exclusion does not apply to watercraft:

(1) That are not sailing vessels and are powered by:

               (a) Inboard or inboard-outdrive engine or motor power of 50 horsepower or less not owned by and                insured;
               (b) Inboard or inboard-outdrive engine or motor power of more than 50 horsepower not owned by or                rented to an insured.
               (c) One or more outboard engines or motors with more than 25 total horsepower or less;
               (d) One or more outboard engines or motors with more than 25 total horsepower if the outboard engine or                motor is not owned by an insured;
               (e) Outboard engines or motors of more than 25 total horsepower owned by an

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insured if:

(i) You acquire them prior to the policy period; and

(a) You declare them at policy inception; or
(b) Your intention to insure is reported to us in writing within 45 days after you acquire the outboard engines or motors.

(ii) You acquire them during the policy period.

This coverage applies for the policy period.
(2) That are sailing vessels, with or without auxiliary power:

               (a) Less than 26 feet in overall length;
               (b) 26 feet or more in overall length, not owned by or rented to an insured.
          (3) That are stored;

h. Arising out of:

          (1) The ownership, maintenance,use, loading or unloading of an aircraft;
          (2) The entrustment by an insured of an aircraft to any person; or
          (3) Vicarious liability, whether or not statutorily imposed, for the actions of a child or minor using an aircraft.

An aircraft means any contrivance used or designed for flight, except model or hobby aircraft not used or designed to carry people or cargo;
i. Caused directly or indirectly by war, including the following and any consequence of any of the following:

          (1) Undeclared war, civil war, insurrection, rebellion or revolution;
          (2) Warlike act by a military force or military personnel; or
          (3) Destruction, seizure or use for a military purpose.

Discharge of a nuclear weapon will be deemed a warlike act even if accidental;
j. Which arises out of the transmission of a communicable disease by an insured;

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k. Arising out of sexual molestation, corporal punishment or physical ormental abuse; or
l. Arising out of the use, sale, manufacture, delivery, transfer or possession by any person of a Controlled Substance(s) as defined by the Federal Food and Drug Law at 21 U.S.C.A. Sections 811 and 812. Controlled Substances include but are not limited to cocaine, LSD, marijuana and all narcotic drugs. However, this exclusion does not apply to the legitimate use of prescription drugs by a person following the orders of a licensed physician.

Exclusion e., f., g. and h. do not apply to bodily injury to a residence employee arising out of and in the course of the residence employee's employment by an insured.

2. Coverage E - Personal Liability, does not apply to:

a. Liability:

(1) For any loss assessment charged against you as a member of an association, corporation or community of property owners;
(2) Under any contract or agreement. However, this exclusion does not apply to written contracts:

(a) That directly relate to the ownership, maintenance or use of an insured location; or
(b) Where the liability of others is assumed by the insured prior to an occurrence;

unless excluded in (1) above or elsewhere in this policy;

     b Property damage to property owned by the insured;
     c. Property damage to property rented to, occupied or used by or in the care of the insured. This exclusion      does not apply to property damage caused by fire, smoke or explosion;
     d. Bodily injury to any person eligible to receive any benefits:

(1) Voluntarily provided; or
(2) Required to be provided;

by the insured under any:

          (1) workers' compensation law;
          (2) Non-occupational disability law; or
          (3) Occupational disease law;

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e. Bodily injury or property damage for which an insured under this policy:

(1) Is also an insured under a nuclear energy liability policy; or
(2) would be an insured under that policy but for the exhaustion of its limit of liability.

A nuclear energy liability policy is one issued by:

          (1) American Nuclear Insurers;
          (2) Mutual Atomic energy Liability Underwriters;
          (3) Nuclear Insurance Association of Canada;

or any of their successors; or
f. Bodily injury to you or an insured within the meaning of part a. or b. of insured as defined.

3. Coverage F-Medical Payments to Others, does not apply to bodily injury:

     a. To a residence employee if the bodily injury:
          (1) Occurs off the insured location; and
          (2) Does not arise out of or in the course of the residence employee's employment by an insured;
     b. To any person eligible to receive benefits:
          (1) Voluntarily provided; or
          (2) Required to be provided;
     under any:
          (1) Workers' compensation law;
          (2) Non-occupational disability law; or
          (3) Occupational disease law;
     c. From any:
          (1) Nuclear reaction;
          (2) Nuclear radiation; or
          (3) Radioactive contamination;
          all whether controlled or uncontrolled or however caused; or
          (4) Any consequence of any of these; or
     d. To any person, other than a residence employee of an insured, regularly residing on any part of the insured      location.

SECTION II - ADDITIONAL COVERAGES

We cover the following in addition to the limits of liability:

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1. Claim Expenses. We pay:

     a. Expenses we incur and costs taxed against an insured in any suit we defend;
     b. Premiums on bonds required in a suit we defend, but not for bond amounts more than the limit of liability for      Coverage E. We need not apply for or furnish any bond;
     c. Reasonable expenses incurred by an insured at our request, including actual loss of earnings (but not loss of      other income) up to $50 per day, for assisting us in the investigation or defense of a claim or suit; and
     d. Interest on the entire judgment which accrues after entry of the judgment and before we pay or tender, or      deposit in court that part of the judgment which does not exceed the limit of liability that applies.

2. First Aid Expenses. We will pay expenses for first aid to others incurred by an insured for bodily injury covered under this policy. We will not pay for first aid to you or any other insured.

3. Damage to Property of Others. We will pay, at replacement cost, up to $500 per occurrence for property damage to property of others caused by an insured.

We will not pay for property damage:

     a. To the extent of any amount recoverable under Section I of this policy;
     b. Caused intentionally by an insured who is 13 years of age or older;
     c. To property owned by an insured;
     d. To property owned by or rented to a tenant of an insured or a resident in your household; or
     e. Arising out of:

          (1) A business engaged in by an insured;
          (2) Any act or omission in connection with a premises owned, rented or controlled by an insured, other than           the insured location; or
          (3) The ownership, maintenance, or use of aircraft, watercraft or motor vehicles or all other motorized land           conveyances.

This exclusion does not apply to a motorized land

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conveyance designed for recreational use off public roads, not subject to motor vehicle registration and not owned by an insured.

4. Loss Assessment. We will pay up to $1000 for your share of loss assessment charged during the policy period against you by a corporation or association of property owners, when the assessment is made as a result of:

a. Bodily injury or property damage not excluded under Section II of this policy; or
b. Liability for an act of a director, officer or trustee in the capacity as a director, officer or trustee, provided:

(1) The director, officer or trustee is elected by the members of a corporation or association of property owners; and
(2) The director, officer or trustee serves without deriving any income from the exercise of duties which are solely on behalf of a corporation or association of property owners.

This coverage applies only to loss assessments charged against you as owner or tenant of the residence premises.

We do not cover loss assessments charged against you or a corporation or association of property owners by any governmental body.

Regardless of the number of assessments, the limit of $1000 is the most we will pay for loss arising out of:

a. One accident, including continuous or repeated exposure to substantially the same general harmful condition; or
b. A covered act of a director, officer or trustee. An act involving more than one director, officer or trustee is considered to be a single act.

The following do not apply to this coverage:
1. Section II-Coverage E-Personal Liability Exclusion 2.a.(1);
2. Condition 1. Policy Period, under SECTIONS I AND II-CONDITIONS.

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SECTION II - CONDITIONS

1. Limit of Liability. Our total liability under Coverage E for all damages resulting from any one occurrence will not be more than the limit of liability for Coverage E as shown in the Declarations. This limit is the same regardless of the number of insureds, claims made or persons injured. All bodily injury and property damage resulting from any one accident or from continuous or repeated exposure to substantially the same general harmful conditions shall be considered to be the result of one occurrence.

Our total liability under Coverage F for all medical expense payable for bodily injury to one person as the result of one accident will not be more than the limit of liability for Coverage F as shown in the Declarations.

2. Severability of Insurance. This insurance applies separately to each insured. This condition will not increase our limit of liability for any one occurrence.

3. Duties After Loss. In case of an accident or occurrence, the insured will perform the following duties that apply. You will help us by seeing that these duties are performed:

a. Give written notice to us as soon as is practical, which sets forth:

          (1) The identity of the policy and insured;
          (2) Reasonably available information on the time, place and circumstances of the accident or occurrence; and
          (3) Names and addresses of any claimants and witnesses;

b. Promptly forward to us every notice, demand, summons or other process relating to the accident or occurrence;
c. At our request, help us:

          (1) To make settlement;
          (2) To enforce any right of contribution or indemnity against any person or organization who may be liable to           an insured;
          (3) With the conduct of suits and attend hearings and trials; and
          (4) To secure and give evidence and obtain the attendance of witnesses;

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d. Under the coverage-Damage to Property of Others-submit to us within 60 days after the loss, a sworn statement of loss and show the damaged property, if the insured's control;
e. The insured will not, except at the insured's own cost, voluntarily make payment, assume obligation or incur expense other than for first aid to others at the time of the bodily injury.

4. Duties of an Injured Person-Coverage F-Medical Payments to Others. The injured person or someone acting for the injured person will:

a. Give us written proof of claim, under oath if required, as soon as is practical; and
b. Authorize us to obtain copies of medical reports and records.

The injured person will submit to a physical exam by a doctor of our choice when and as often as we reasonably require.

5. Payment of Claim-Coverage F-Medical Payments to Others. Payment under this coverage is not an admission of liability by an insured or us.

6. Suit Against Us. No action can be brought against us unless there has been full compliance with the policy provisions.

No one will have the right to join us as a party to any action against an insured. Also, no action with respect to Coverage E can be brought against us until the obligation of the insured has been determined by final judgment or agreement signed by us.

7. Bankruptcy of an Insured. Bankruptcy or insolvency of an insured will not relieve us of our obligations under this policy.

8. Other Insurance-Coverage E-Personal Liability. This insurance is excess over other valid and collectible insurance except insurance written specifically to cover as excess over the limits of liability that apply in this policy.

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SECTION I AND II - CONDITIONS

1. Policy Period. This policy applies only to loss in Section I or bodily injury or property damage in Section II, which occurs during the policy period.

2. Concealment or Misrepresentation. This entire policy will be void and all coverages forfeited, and payment will not be made to any insured, if before or after a loss, any insured has knowingly concealed or misrepresented any material fact or circumstance relating to this insurance, the insurance application, the loss, the presentation of the claim or any other fact or circumstance material to the investigation and adjustment of the claim.

3. Liberalization Clause. If we make a change which broadens coverage under this edition of our policy without additional premium charge, that change wil automatically apply to your insurance as of the date we implement the change in your state, provided that this implementation date falls within 60 days prior to or during the policy period stated in the Declarations.

This Liberalization Clause does not apply to changes implemented through introduction of a subsequent edition of our policy.

4. Waiver or Change of Policy Provisions. A waiver or change of a provision of this policy must be in writing by us to be valid. Our request for an appraisal or examination will not waive an of our rights.

5. Cancellation.

a. You may cancel this policy at any time by returning it to us or by letting us know in writing of the date cancellation is to take effect.
b. We may cancel this policy only for the reasons stated below by letting you know in writing of the date cancellation takes effect. This cancellation notice may be delivered to you or mailed to you at your mailing address shown in the Declarations.

Proof of mailing will be sufficient proof of notice.

(1) When you have not paid the premium, we may cancel at any time by letting you know at

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          at least 10 days before the date cancellation takes effect.
          (2) When this policy has been in effect for less than 60 days and is not a renewal with us, we may cancel for           any reason by letting you know at least 10 days before the date cancellation takes effect.
          (3) When this policy has been in effect for 60 days or more, or at any time if it is a renewal with us, we may           cancel:

(a) If there has been a material misrepresentation of fact which if known to us would have caused us not to issue the policy; or
(b) If the risk has changed substantially since the policy was issued.

          This can be done by letting you know at least 30 days before the date cancellation takes effect.
          (4) When this policy is written for a period of more than one year, we may cancel for any reason at anniversary           by letting you know at least 30 days before the date cancellation takes effect.
     c. When this policy is cancelled, the premium for the period from the date of cancellation to expiration date will be      refunded pro rata.
     d. If the return premium is not refunded with the notice of cancellation or when this policy is returned to us, we will      refund it within a reasonable time after the date cancellation takes effect.

6. Nonrenewal. We may elect not to renew this policy. We may do so by delivering to you, or mailing to you at your mailing address shown in the Declarations, written notice at least 30 days before the expiration date of this policy. Proof of mailing will be sufficient proof of notice.

7. Assignment. Assignment of this policy will not be valid unless we give our written consent.

8. Subrogation. An insured may waive in writing before a loss all rights of recovery against any person. If not waived, we may require an assignment of rights of recovery for a loss to the extent that payment is made by us.

If an assignment is sought, an insured must sign and

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deliver all related papers and cooperate with us.

Subrogation does not apply under Section II to Medical Payments to Others or Damage to Property of Others.

9. Death. If any person named in the Declarations or the spouse, if a resident of the same household, dies; we insure the legal representative of the deceased, but only with respect to the premises and property of the deceased covered under the policy at the time of death.

Insured includes:

a. Any member of your household who is an insured at the time of your death, but only while a resident of the residence premises; and
b. With respect to your property, the person having proper temporary custody of the property until appointment and qualification of a legal representative.

In Witness Whereof, we have caused this policy to be executed and attested, and, if required by state law, this policy shall not be valid unless countersigned by our authorized representative.

______________________________________________________Secretary

______________________________________________________President

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Please keep your Declarations Certificates and
Endorsements with your policy.

Includes copyrighted material of Insurance
Services Office, Inc. with its permission.

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Form No. 5106 (Ed. 1/96)