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Commercial Output Program
| Commercial Output XL Program
Developers Output Program (DOP)
The AAIS "COP" sets the industry standard as the updated version--filed and approved countrywide--of the former manufacturer's output policy, or "MOP."
Since AAIS expanded eligibility to include commercial and institutional as well as industrial risks, the COP has served as the basis for property programs covering everything from metalworking operations to school districts to golf courses. It is ideally suited for large, multi-site risks with transit exposures.
Like all true output programs, the COP incorporates broad property and inland marine coverages in a few coverage parts (property, crime, equipment breakdown, and income).
The base property form provides blanket coverage for all insured locations, but an endorsement option allows you to write scheduled coverage, or some combination of blanket and scheduled. For example, you could combine scheduled coverage for a manufacturing plant with blanket coverage for its dealerships. Also, the COP property form can be packaged with non-AAIS forms in a commercial package.
By eliminating the need to add numerous endorsements, the COP provides a streamlined policy and minimizes the possibility of coverage gaps. For example, the base property form includes a wide range of built-in supplemental coverages, including those commonly found in standard commercial property forms, plus additional inland marine coverages, all at relatively high limits. The limits on supplemental coverages and coverage extensions can be adjusted without a separate endorsement by entries on the declarations.
Similarly, the equipment breakdown coverage part, developed in conjunction with the Hartford Steam Boiler Inspection and Insurance Company, includes built-in options (activated by dec page entries) for additional income, spoilage, utility interruption and other coverages typically added by endorsement.
Crime coverage is provided through a choice among several forms:
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A "loss sustained" form, under which the insurer pays recovery for losses that actually occurred during the policy period; and
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A "discovery" form, under which the insurer pays recovery for any loss discovered during the policy period, regardless of when it occurred.
Each of these forms provides a choice of six commercial crime coverages: employee fraud and dishonesty; computer/telecommunications fraud; counterfeit money; forged credit card written instruments; forged checks; and money and securities.
In addition, the program provides a third, simplified crime form that offers a choice of coverage for employee fraud and dishonesty, money and securities, or both.
Companies highly value the systematic but flexible COP rating procedure that allows them to rate a risk as a single entity, rather than as the sum of disparate
coverages.
For each major coverage part (property, crime, equipment breakdown, and income) the COP manual provides sample deficiency point rating scales that underwriters can use to modify loss loads to reflect relevant risk characteristics of an insured (construction, fire protection, age of equipment, number of employees, etc.).
This expanded version of the COP was developed to address the property insurance needs and expectations of the largest commercial accounts. It offers even more built-in coverages than the standard COP, most notably built-in equipment breakdown coverage.
For example, the COP-XL provides built-in coverage for "Web Site Interruption" and "Overseas Transit and Location;" coverages that are provided by endorsement under the standard COP.
As with the COP, a COP-XL policy can be written on a blanket or scheduled basis, or some combination of the two. Rating is done through the popular deficiency point rating procedure.
Click here to see how the COP-XL compares with the standard COP.
The AAIS Developers Output Program (DOP) adapts output coverage and rating to the unique needs of building contractors by integrating builders risk, mobile equipment, and other construction-related inland marine coverages with commercial property coverage in a single policy form.
As with the COP, this program allows an insurer to offer blanket or scheduled property coverage for buildings and personal property, including temporary storage and transit. The base property form includes built-in supplemental coverages for construction exposures, such as contract penalty, employee tools, expediting expenses, and others. Coverage for "soft costs" and leased equipment can be added by endorsement. Commercial crime and income coverage parts are also provided.
The DOP uses the same systematic but flexible rating procedure as the COP, but the deficiency point criteria are adjusted to reflect construction exposures.
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