Part 19. Risk Management - Table of Contents

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19.1.3. EQUIPMENT AND OCEAN CARGO INSURANCE AND RELATED CLAIMS

A. Introduction

The equipment insurance policy provides coverage for direct physical loss or damage to scheduled miscellaneous articles. The policy insures against all risks of physical loss or damage from any external cause, except as excluded within the policy. The policy provides worldwide coverage excluding North Korea, Libya, Iraq, Afghanistan, Syria, Liberia, Cuba, and other politically unstable regions. The policy excludes coverage during over-ocean cargo shipments; however, ocean cargo coverage can be purchased to supplement the equipment policy. For more information about ocean cargo coverage, contact the Office of Accounting Risk Management at oa.riskmgt@austin.utexas.edu.

B. Rates

Equipment insurance for the current policy period (insured through October 31, 2012) can still be purchased at a rate of $0.35 per $100 of equipment value. This deeply discounted rate is available due to co-sponsorship from the CFO for the 2011-2012 policy year. Note that premium rates will likely increase to at least $0.60 per $100 of equipment value for most items, and $1.30 per $100 of equipment value for waterborne use items.

Premium rates for the upcoming policy year November 1, 2012 – October 31, 2013 are under negotiation and will be published once finalized.

C. Equipment Policy Details

• Carrier: Federal Insurance Company
• The policy renews annually on Nov. 1.
• Covered Items
  Covered items include scheduled miscellaneous articles that is owned or in the control or care of The University of Texas at Austin, including, but not limited to:
  • scientific equipment
  • medical equipment
  • geological equipment
  • computer equipment
  • software (report values for the media separate from any computer it might be used in)
  • radio-television-film equipment
  • nonmotorized boats  
  • other nonmotorized waterborne vessels.
  
  Note: Unless required by a lease agreement, insuring furniture and fixtures under this policy is not recommended due to limitation of loss recovery. For more information, contact the Office of Accounting Risk Management at oa.riskmgt@austin.utexas.edu.
  
  
• Valuation
  Property of The University of Texas System campuses shall be valued up to the current market value of the property at the time of the loss. Property that is loaned to The University of Texas at Austin by other entities shall be valued at amounts agreed upon by the insured and owners and included as part of the loan contract or agreement. Furniture and fixture loss is limited to actual cash value, which is generally less than replacement cost.
  
  
• Limits of Insurance

  $20,000,000	Any one occurrence
  $1,500,000	On any one item
  $5,000,000	Flood, surface water, deluge, backup of sewers and drains annual aggregate
  Not Covered	Earthquake in the state of California
  $5,000,000	Earthquake in Canada or the U.S. and its territories or possessions, excluding the state of California, annual aggregate
  $2,000,000	Any one conveyance for ocean cargo
  $1,500,000	Any one occurrence while in transit
  $1,500,000	New acquisitions reported within 60 days
  $1,500,000	Any one occurrence as to property loaned to insured on a temporary basis
  $1,500,000	Per occurrence and annual aggregate as to property while waterborne, underwater, or over the side of any one watercraft
  $500,000	Any one occurrence as to property loaned/rented/leased to others
  $500,000	Wind/Hail outside the United States and Canada
  $100,000	Any one occurrence as to mechanical breakdown

  
  
  
• Deductibles

  (If a claim consists of more than one covered item having different deductibles, the higher deductible would apply)
  $1,000	During transit while covered by ocean cargo.
  $1,500	Per occurrence, except $1,000 as to laptop computers; and $100 as to oximeters and to personal digital assistants (PDAs)
  $2,500	Mechanical breakdown (covered while items are being used/stored if there is visible external damage.)
  $10,000	Mobile cath labs
  $10,000	Minimum per occurrence or 2 percent of values, whichever is greater, as to wind/hail in the U.S. and Canada
  $25,000	Per occurrence as to flood, surface water, deluge, backup of sewers and drains
  $25,000	Per occurrence as to earthquake in Canada or the U.S. and its territories or possessions, excluding the state of California.
  $25,000	Per occurrence as to wind/hail outside the U.S. and Canada: (wind/hail outside U.S. and Canada is limited to $500,000)
  $25,000	Per occurrence as to property while waterborne, underwater, or over the side any one watercraft

  
  
  
• Exclusions
  The equipment insurance policy excludes losses due to:
  
  • Flood and earthquake outside the United States and Canada
  • Earthquake in the state of California
  • Mechanical breakdown of laptop computers
  • Certain flood zones in the United States
    Note: Flood is defined as including surface water, backup of sewers and basement water
  • Theft from unlocked conveyances
  • Mechanical breakdown and internal derangement while in transit
  • Errors in systems programming or errors in instructions to a machine (scientific equipment; electronic data processing (EDP) equipment and media; telephone equipment)
  • Other exclusions as defined by the policy

D. Coverage

Each department has a designated inventory contact listed in the Organizational Hierarchy System (OHS) Contacts System. The Annual Equipment Insurance System (AEIS) is used to track and report insured equipment.

1. How to Obtain or Drop Annual Equipment Insurance during Renewal Time
   
   During the annual renewal, which normally occurs in August for a policy effective date of Nov. 1, all equipment is reviewed by the department’s inventory contact to determine if insurance should be continued for each item. Equipment insurance must be renewed annually in AEIS to maintain coverage. Access to AEIS is granted through the *DEFINE NVE command authorization by the department’s electronic office manager. Training is provided annually by the Office of Accounting Risk Management section. For more information, see DE 438 Equipment Insurance or contact oa.riskmgt@austin.utexas.edu.
   
   
2. How to Obtain or Drop Annual Equipment Insurance during Nonrenewal Time
   
   To request the purchase of equipment insurance, contact the department’s inventory contact. Premium expense will be charged for the remainder of the policy year.
   
   
3. How to Obtain Temporary Equipment Insurance
   
   To obtain temporary equipment insurance, which is only available for items loaned or leased to the university, follow these procedures:
   1. Complete the Temporary Equipment Insurance Request Form.
   2. Send an email to the authorized signer (typically a dean, director, or chair) on the account to be charged for the premium expense.
   3. The account signer should forward the email to oa.riskmgt@austin.utexas.edu along with the spreadsheet from Step 1. The authorized signer may copy the requestor on the email.
      
      
4. Ocean Cargo Insurance
   
   If items will be shipped over a body of water, complete and submit the Ocean Cargo Insurance Request to oa.riskmgt@uastin.utexas.edu at least five days prior to shipment.
   
   
5. How to Obtain Waterborne Equipment Insurance
   
   To obtain waterborne equipment insurance, which is available only on a year round basis for property to be used while waterborne, underwater, or over the side of watercraft, follow these procedures:
   1. Complete the Waterborne Equipment Insurance Request Form.
   2. Send an email to the authorized signer (typically a dean, director, or chair) on the account to be charged for the premium expense.
   3. The account signer should forward the email to oa.riskmgt@austin.utexas.edu along with the spreadsheet from Step 1. The authorized signer may copy the requestor on the email.

E. Claims Procedures

1. Theft or Loss of Insured Equipment
   
   
   • If the lost or stolen item was covered by the university’s equipment insurance policy:
     1. Report the incident to The University of Texas at Austin Police Department or local police (depending on whether the theft occurred on or off campus). Obtain a copy of the police report as soon as possible.
     2. Complete a Potential Claim Incident Report.
     3. Submit the Potential Claim Incident Report, along with the police report, to the Office of Accounting Risk Management at oa.riskmgt@austin.utexas.edu.
     4. An estimate of the item’s replacement value should also be submitted as soon as possible.
   • If the lost or stolen item was university-owned, see 16.3 Removal of Equipment from the Inventory, section F. Lost or Stolen Property for additional steps that must be taken to remove the item from the university’s inventory.
     
     
2. Damage to equipment due to malicious mischief
   
   
   1. Report the incident to The University of Texas at Austin Police Department or local police (depending on whether the theft occurred on or off campus). Obtain a copy of the police report as soon as possible.
   2. Take photos.
   3. Secure a repair estimate.
   4. If damaged beyond repair, notify Inventory Services of the loss for removal from inventory.
   5. Complete a Potential Claim Incident Report.
   6. Submit the Potential Claim Incident Report, police report, photos, and repair estimate to the Office of Risk Management at oa.riskmgt@austin.utexas.edu.
      
      
3. Losses due to damage from water leaks, accidental damage, malfunction, or other causes.
   
   
   1. Take photos.
   2. Secure a repair estimate.
   3. If damaged beyond repair, notify Inventory Services of the loss for removal from inventory.
   4. Complete a Potential Claim Incident Report.
   5. Submit the Potential Claim Incident Report, photos, and repair estimate to the Office of Risk Management at oa.riskmgt@austin.utexas.edu.

For more information, contact the Office of Risk Management at oa.riskmgt@austin.utexas.edu

F. Resources

• Email the Office of Accounting Risk Management at oa.riskmgt@austin.utexas.edu.
• Potential Claim Incident Report
• Ocean Cargo Insurance Request
• Temporary Equipment Insurance Request Form
• Waterborne Equipment Insurance Request Form

 

 

Part 19. Risk Management - Table of Contents