PROPERTY COVERAGE

PROPERTY COVERED

1. Property covered includes:

1. NPP of every description including property for which NPF may be legally liable, including during construction or while in transit or situated anywhere in the world, except as may be excluded in paragraph 2 hereunder. Property shall be deemed to include money and securities and securities for money;

NOTE: You shall notify the CFO&VPI of any disruption to or flaw or defect to any sprinkler, fire extinguishing, fire detection or intrusion system.

2. property of every description owned by or for which a PMQ/Community Council may in any way be responsible, except as may be excluded in paragraph 2 hereunder;

3. notwithstanding the exclusion at subparagraph 2a, self-propelled land conveyances not owned or operated by or registered in the name of NPF, to the extent of NPF legal liability for loss or damage caused by any of the perils insured under this policy while such conveyances are in the care, custody or control of NPF; and

4. property of military museums to the extent outlined in Appendix 2 to Annex M.

PROPERTY EXCLUDED

2. The following property is excluded from coverage:

1. self-propelled land conveyances and automobiles required by law to be licensed, other than as provided for in paragraph 1.c. above;

2. aircraft (including gliders), animals, fish, birds, growing plants;

3. documents other than money and securities, and securities for money;

4. shipments made under an Ocean Bill of Lading or through Bill of Lading including during transit by commercial conveyance connected with the carrying vessel;

5. NPF property that is located remote from the active area of the unit as outlined in paragraph 22 of this chapter;

6. neon signs, and automatic or mechanical electric signs, plate glass or any lettering or ornamentation thereon, unless such loss is caused directly by fire or the combating thereof; and

7. NPF paid improvements/renovations to a mess which were made more than 20 years prior to a loss.

UNIT DEDUCTIBLES ON CLAIMS

3. Unit deductible rates for each occurrence of loss are outlined in paragraph 15 of this chapter.

LIMIT OF LIABILITY

4. The limit of liability under this policy for the cumulative total of adjusted net claims resulting from any occurrence, loss, casualty or disaster shall not exceed the amount stated in the Unit property listing.

RISKS EXCLUDED

5. The NPF CIP does not provide coverage for the following:

1. loss or damage caused by or resulting from moths, vermin, termites, or other insects, inherent vice, latent defect, wear, tear or gradual deterioration, contamination, rust, wet or dry rot, mold, dampness of atmosphere, smog or extremes of temperature, or loss or damage by normal settling, shrinkage or expansion in building or foundation unless resulting in or from a loss not otherwise excluded;

2. loss of use, delay or loss of markets;

3. loss due to employee infidelity, intentional act, or any dishonesty on the part of the Insured or any employee or others to whom the property may be delivered or entrusted, inventory shortage or unexplained disappearance as defined by Canadian Laws and practice;

4. except for the consequential loss of any food items due to refrigeration failure, the loss or damage to electrical appliances, devices, fixtures or wiring caused by artificially generated electrical current, unless fire or explosion ensues, and then only for the actual loss or damage caused by such ensuing fire or explosion;

5. breakdown or derangement of machinery unless fire ensues and then only for the actual loss or damage caused by such ensuing fire;

6. loss, damage or destruction directly or indirectly occasioned by or through or in consequence of a war invasion act or warlike operation by a foreign enemy or as a result of a civil insurrection;

7. loss or damage to property caused by processing, renovating, repairing or faulty workmanship thereon, unless fire and/or explosion ensues, and then only for direct loss or damage caused by such ensuing fire or explosion; and

8. ground improvements to NPF golf courses, such as greens or sand traps, which may be damaged as a result of a hailstorm, flood, tornado, etc.

BASIS OF VALUATION

6. The basis of valuation of NPF property for purposes of NPF insurance is outlined in paragraphs 17 to 21 inclusive of this chapter, as applicable.

SALVAGE

7. Salvage of property such as furniture, equipment and merchandise, involved in an insurance claim, falls into two categories:

1. property is damaged but is still in the possession of the NPF activity experiencing the loss; and

2. stolen property is recovered after the claim is paid.

8. In the situation at 7a, the following action should be taken, as applicable:

1. if the property can be repaired at a reasonable cost, action should be taken to effect the repairs, in which case the value of the claim is the cost of repairs; or

2. if the action at 8a is not feasible, the property should be sold, in which case the value of the claim is the value of the property damaged (as outlined in paragraphs 17 and 18 of this chapter), less the salvage value received as a result of the sale. Note that if damaged merchandise can be sold at a price above cost, no loss has been experienced.

9. In cases where stolen goods (furniture and equipment or merchandise) are recovered after the claim has been settled, the following procedure is required:

1. obtain CFO&VPI authority for the release of the property from the police if necessary;

2. if the property is not damaged and has not depreciated in value, the value claimed is refundable to the NPF CIP;

3. if the property is damaged but can be repaired, then the difference between the cost of repairs and the claim for loss is refundable to the NPF CIP;

4. if the property can be sold for salvage, the amount received for salvage is refundable to the NPF CIP; and

5. if the property can be neither repaired nor sold for salvage, then CFO&VPI authority for its destruction is to be obtained.