DEFINITIONS

The following definition is added:

9. "Fungi" means any type or form of fungus, including mold or mildew, and any mycotoxins, spores, scents or by-products produced or released by fungi.

SECTION I - PROPERTY COVERAGES

COVERAGE C - Personal Property

Property Not Covered
Under item 3., paragraph 3 is deleted and replaced by the following:

We do cover vehicles or conveyances not subject to motor vehicle registration which are:
a. Used solely to service an insured's residence; or
b. Designed for assisting the handicapped;

COVERAGE D - Loss of Use

The first paragraph is deleted and replaced by the following:

The limit of liability for Coverage D is the actual loss sustained within 12 months from the date of the loss for 1. and 2. below:

Item 1. is deleted and replaced by the following:

1. If a loss covered under this Section makes that part of the residence premises where you reside not fit to live in, we cover the Additional Living Expense, meaning any necessary increase in living expenses incurred by you so that your household can maintain its normal standard of living.

Payment 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 settle elsewhere.

Item 3. is deleted and the following paragraph is added:

If a civil authority prohibits you from the 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 as provided under 1. and 2. above for no more than two weeks.

The paragraph "The periods of time under 1., 2. and 3. above are not limited by expiration of this policy." is deleted and replaced by the following:

The periods of time for all the above are not limited by expiration of this policy.

SECTION I - ADDITIONAL COVERAGES

11. Ordinance or Law. The following Paragraph is added to c. (2):

This exception applies whether or not the irritant or contaminant has any function with respect to your property or business.

(This is Additional Coverage 10. in our Premier Condominium Policy. This does not apply to our Premier Select Policy)

SECTION I - PERILS INSURED
AGAINST

For Premier and Premier Plus policies, under Coverage A - Dwelling and Coverage B - Other Structures, Item 2.e. (3) is deleted and replaced by the following:

(3) Smog, rust or other corrosion, fungi, mold, wet or dry rot;

If this endorsement is attached to our Premier or Premier Plus Policy or our Premier Condominium Policy with either CO 17 31 or HO 17 32 or both, then the following is added to Paragraph 2.e. (5) in our Premier and Premier Plus Policy, Paragraph 3.d.(5) on CO 17 31 and Paragraph 2.e.(5) on HO 17 32;

In this provision, any reference to pollutants applies whether or not the irritant or contaminant has any function with respect to your property or business.

SECTION I - EXCLUSIONS

1. Ordinance or Law. The following Paragraph is added:
This exclusion applies whether or not the property has been physically damaged, or whether or not the irritant or contaminant has any function with respect to your property or business.

SECTION I - CONDITIONS

12. Mortgage Clause

Item b. is deleted and replaced by the following:

b. Pays any premium due under this policy when notified if you have neglected to pay the premium; and

SECTION II - EXCLUSIONS

Exclusions m. and n. are added:

m. Arising out of the liability assumed by the insured under any contract or agreement except any indemnity obligation assumed by the insured under a written contract directly relating to the ownership, maintenance or use of the premises.

n. Arising out of the liability for claims made against any insured arising out of the sale or transfer of the insured premises or other real estate including but not limited to any claims made against any insured for fraud, misrepresentation, failure to disclose or any other claim made against any insured arising out of the sale or transfer of real estate.

SECTION I AND II - CONDITIONS

2. Concealment or Misrepresentaton is deleted and replaced by the following:
2. Concealment, Fraud or Misrepresentation.
a. Under SECTION I - PROPERTY COVERAGES with respect to all insureds covered under this policy, we provide no coverage for loss under SECTION I - PROPERTY COVERAGES if, whether before or after a loss, one or more insureds, have:

(1) Intentionally concealed or misrepresented any material fact or circumstance;
(2) Engaged in fraudulent conduct; or
(3) Made false statements;
relating to this insurance.

b. Under SECTION II - LIABILITY COVERAGES, we do not provide coverage to one or more insureds who, whether before or after the loss, have:

(1) Intentionally concealed or misrepresented any material fact or circumstance;
(2) Engaged in fraudulent conduct; or
(3) Made false statements;
relating to this insurance.

5. Cancellation.
The following is added to Paragraphs b. (2) and (3):
However, if any one of the following conditions exist at any building that is covered in this policy, we may cancel this policy by letting you know at least 5 days before the date cancellation takes effect.

(a) The building has been vacant or unoccupied 60 or more consecutive days.
This does not apply to:

(i) Seasonal unoccupancy; or
(ii)Buildings in the course of construction, renovation or addition.

Buildings with 65% or more of the rental units or floor area vacant or unoccupied are considered unoccupied under this provision.

(b) After damage by a covered peril, permanent repairs to the building:

(i) Have not started; and
(ii) Have not been contracted for;

within 30 days of payment of loss.

(c) The building has:

(i) An outstanding order to vacate;
(ii) An outstanding demolition order, or
(iii) Has been declared unsafe by governmental authority.

(d) Fixed and salvageable items have been or are being removed from the building and are not being replaced. This does not apply to removal that is necessary or incidental to any renovation or remodeling.

(e) Failure to:

(i) Furnish necessary heat, water, sewer service or electricity for 30 consecutive days or more, except during a period of seasonal unoccupancy; or
(ii) Pay property taxes that are owing and have been outstanding for more than one year following the date due, except that this provision will not apply where you are in a bona fide dispute with the taxing authority regarding payment of such taxes.

Paragraph b.(4) is deleted in its entirety.

The following condition is added:

10. Notice to Agent. Your notice is our agent will be deemed to be notice to us.

All other provision of this policy apply.

AUTO CLUB FAMILY INSURANCE COMPANY