PREFERRED AUTO PROGRAM CSE SAFEGUARD ......(Ed.10 2017) CSE Safeguard Insurance Company Page 7 of 21 G. Special Rules There will be times during quoting, issuing, and servicing policies

Utah Preferred Auto Program

(Ed.10 2017) CSE Safeguard Insurance Company Page 1 of 21

PREFERRED AUTO PROGRAM

CSE SAFEGUARD INSURANCE COMPANY MANAGED BY UNITED UNDERWRITERS, INC.

UTAH Private Passenger Auto Liability and Physical Damage

Underwriting Guide

Rates effective New business 10/27/201705/15/2018

Renewal business 12/07/201706/29/2018



Table of Contents

FORMS LIST ............................................................................................................................. 3 I. UNDERWRITING RULES ............................................................................................. 4

A. Application and Binding Authority .................................................................................. 4 B. Eligibility – New Business .............................................................................................. 4 C. Unacceptable Drivers .................................................................................................... 5 D. Unacceptable Vehicles .................................................................................................. 5 E. Additional Physical Damage Rules ................................................................................ 6 F. Submit for Approval – Do Not Bind ................................................................................ 6 G. Special Rules ................................................................................................................ 7 H. Policy Term ................................................................................................................... 8 K. Fees .............................................................................................................................. 8

II. COVERAGE .................................................................................................................. 9 A. Liability .......................................................................................................................... 9 B. Personal Injury Protection (PIP) – [PP 05 79] ................................................................ 9 C. Uninsured/Underinsured Motorists Bodily Injury - [PP 04 66] ........................................ 9 D. Uninsured Motorists Property Damage – [PP 04 24] ..................................................... 9 E. Under-Insured Motorists Property Damage ................................................................... 9 H. Physical Damage .........................................................................................................10 III. OPTIONAL COVERAGES ............................................................................................10 A. Emergency Road Service .............................................................................................10 B. Enhanced Rental Reimbursement Coverage ................................................................10 C. Automobile Rental Enhancement – [PAE-9023] ...........................................................10 G. Equivalent Replacement Cost Coverage - [F.34535A] ..................................................14

IV. CLASSIFICATION & RATING ......................................................................................16 A. Driver Classification ......................................................................................................16 B. Vehicle Usage ..............................................................................................................16 C. Premium Rounding .......................................................................................................17 D. Premium Increase Cap .................................................................................................17 F. Discounts .....................................................................................................................17 G. Zip Codes/Territories ....................................................................................................19

V. POLICY ADMINISTRATION .........................................................................................19 A. Policy Surcharges ........................................................................................................19 B. Policy Changes & Endorsements .................................................................................19 C. Cancellations ............................................................................................................ 2019 D. Reinstatements ............................................................................................................20 E. Renewals ................................................................................................................. 2120 F. Non-Renewals, Cancellations .................................................................................. 2120



FORMS LIST

FORM#

EDITION DATE

TITLE

*F.34600A 0717 Personal Auto Policy

*PP 01 93 0717 Amendment of Policy Provisions – Utah

PP 03 05 0886 Loss Payable Clause

PP 03 19 0694 Additional Insured – Lessor

*PP 05 79 0817 Personal Injury Protection Coverage – Utah

PAE-9023 0817 Automobile Rental Coverage (Preferred only)

PAE 1023 0505 Named Driver Exclusion – Utah

PAE-APP-CSE 0207 CSE Insurance Application

02-2002 CSE Insurance Company – Preferred Auto Questionnaire

F.34545A 0917 Loan/Lease Gap Coverage

F.34555A 0917 Original Equipment Manufacturer

F.34550A 0917 Rideshare Coverage

F.34535A 0917 Equivalent Replacement Cost Coverage

F.34530A 0917 Medical Parts and Accessibility Coverage

* Indicates Mandatory Forms



I. UNDERWRITING RULES

The final decision as to acceptability will remain with the company. A. Application and Binding Authority

1. Producers can bind coverage as of the TIME and DATE shown on the application, provided that:

a) The computer issued policy and application are fully completed. Specifically including name, address, full address, work and home phone numbers, complete VIN#(s), driver’s license number(s), all household residents listed with DOB, full employment information including months employed, and “yes/no” questions answered. Second, the application is legible and signed where required by both the applicant and producer, with a full down payment.

b) All persons living in the household are listed on the application and all those that are licensed or have a permit are rated as drivers.

c) All occupants of the home must be listed on the application. d) The named insured and spouse (if applicable) must be 21 or above. Age 25 or above if single. No drivers age 75 and above. e) A maximum of one minor moving violation or minor accident per driver per policy. No violations allowed on youthful (under age 25) drivers.

2. Incomplete or unsigned applications or applications received without the premium payment, will not be considered bound. Applications for ineligible drivers or vehicles will be cancelled and not be eligible for reinstatement

3. Applications with false or misleading information by applicant will be cancelled and not be eligible for reinstatement.

4. Coverage(s) may not be bound in excess of the limits, including deductible, shown in this manual.

B. Eligibility – New Business

1. Motor vehicles of the private passenger, station wagon, utility, pickup, van or panel truck-type which DO NOT exceed 10,000 pounds gross vehicle weight.

2. Applicants must be the registered owner or lessee under a long-term lease agreement of at least six (6) months.

3. Named insureds must be 21 years of age or older if married. 25 years of age or older if single.

4. All drivers must have a valid Utah driver’s license. 5. Evidence of compliance of financial responsibility law must be retained by

the agent and available upon request of the company. 6. The final decision as to acceptability will remain with the company. 7. Named Insured must have minimum of three (3) years driving experience

in U.S.



C. Unacceptable Drivers

1. Drivers without a valid Utah Driver License; unless the driver obtains a UT license within thirty (30) days of inception. If licensed in Utah less than one year prior driving info must be submitted.

2. Drivers who are not residents of Utah, or Military not stationed in Utah. 3. Entertainers, professional athletes, or other nationally or locally well-

known individuals. 4. Drivers with a suspended, revoked or expired driver's license. 5. Drivers with more than one (1) traffic conviction in the past 3 years.

Maximum 1 violation per driver per policy. No major violations or at-fault accidents over $1000. No violations allowed on youthful (under 25 years old) drivers.

6. Drivers with any driving violations considered anything but “minor” violations within six (6) years.

7. Drivers with any alcohol related violations within the last 6 years. 8. Drivers with an unlicensed spouse. Exceptions MAY be obtained with

prior approval from the underwriting department. See G:5 – Special Rules.

9. Risks with residents of driving age not licensed or license invalid.

D. Unacceptable Vehicles

1. Vehicles garaged outside Utah. 2. Vehicles valued more than $80,000. 3. Vehicles not titled in the name of the applicant or an immediate family

member (i.e. parent & child, siblings, must be listed on policy and rated for) unless a long term (more than six (6) months) leased vehicle. Copy of lease agreement must be submitted with application.

4. Vehicles built, designed or used for prearranged speed contests. 5. Emergency vehicles, taxi cabs, limousines, general livery or vehicles

rented or lent to other operators on a regular basis. 6. Vehicles used for messenger or delivery service. 7. Vehicles used to transport passengers, such as: day camps, nursery

schools, day care centers, convalescent homes, churches, etc. 8. Dune buggies, golf carts and off road type vehicles, or any type not

licensed for highway use. 9. Any antique, classic, custom, electric, Kits, limited editions (low

production), race, replicas, or show cars. 10. Vehicles which have been substantially modified in appearance or

mechanically altered. 11. Vehicles with modified suspension, such as: lowering or lift kits, snow

plows or any which have been modified for off road use. (i.e. chopped, lowered, lifted, turbo charged.)

12. Recreational Vehicles (RV), motorcycles, ATVs, open air jeeps and any vehicle with more or less than four (4) wheels.

13. Vehicles with a load capacity exceeding 1 Ton.



14. Any of the following: Tesla, , Clenet, DeLoreans, Pantera, Stutz, Zimmer, or any unique or custom built vehicles.

15. Custom vans without photographs. (Van conversions are SUBMIT – DO NOT BIND). See F:1 listed below.

16. Physical damage for any vehicle with preexisting damage (other than normal wear and tear). Please submit photos of damage.

E. Additional Physical Damage Rules

1. Inspection forms must be completed and retained by agent on vehicles with physical damage if there is a lapse in prior coverage or no prior coverage to maintain physical damage endorsement. Photos (front driver corner, rear passenger corner) must also be submitted if the Physical Damage endorsement is applied to a pre-existing vehicle in midterm.

2. Physical Damage may not be written without Liability. 3. Comprehensive may not be written without collision. 4. If Data is not available from ISO on a VIN, the factors will be based on an

equivalent vehicle. 5. Customized Vans – Increase one symbol for each $1,000 value of

customized equipment. Follow submit rules listed below.

F. Submit for Approval – Do Not Bind

1. Van Conversions: Submit with the following: a. The cost of conversion. An appraisal may also be required b. Complete description and list of equipment, such as: carpeting,

interior lights, captain chairs, custom seating, couch, cabinet and sink, height extending roof, side windows, running boards, ladder, wheels, tires, custom paint, etc. (All equipment must be listed and included in the value of the van to be covered)

c. Photographs of both the interior and exterior. 2. Gray Market (self-imported) vehicles.



G. Special Rules

There will be times during quoting, issuing, and servicing policies when certain things cannot be done. Usually pop-up windows in the system will guide you as to what to do. A list of procedures is given below. 1. Full coverage cannot be added to an existing vehicle without

photos (front driver side corner and rear passenger side corner). 2. Exceptions to normal underwriting may be obtained from the

underwriting department if appropriate justification is demonstrated by the Agent.

3. Deleted points. Consideration may be given by the underwriting department. Please call.

4. Exclusions. The company’s position remains that if a person resides in the insured household, they must be rated or excluded. We may allow driver exclusions with prior underwriting approval in the situations below. a) Licensed drivers living in the same household (other than

student roommates) or non-residents who have driven the insured’s vehicle(s) the following is required:

i. The exclusion form signed by the named insured and the excluded driver

ii. Proof of other coverage for the excluded driver must be retained by agent and made available to company upon request.

iii. List the excluded person under “residents” and choose “excluded“ in the DL# field.

b) Excluded roommates – the exclusion(s) only needs to be signed by the named insured. A separate form is required for each roommate.

5. Unlicensed residents. Risks where a resident of the household has a suspended driver license are ineligible for this program. If a resident of driving age has never been licensed, the risk may be acceptable.

• If the named insured’s spouse is not licensed, underwriting approval is required prior to writing the policy.

A completed unlicensed resident agreement must be submitted to the company.

6. Driver Rating: All drivers must be rated on a vehicle. Two youthful drivers cannot be rated on the same vehicle.

7. UU Mail. Company underwriting requests will generally be sent via UU Mail and the agency must make diligent efforts to answer all requests by the indicated pend date. Contact the underwriting department if assistance is needed with this or any other system utility.



8. Incarcerated Spouse: If the named insured or spouse is incarcerated the risk is unacceptable.

H. Policy Term

Policies may be issued for a six (6) month term. All rates shown are for six (6) months.

I. Broker of Record Change When we receive a broker of record change request, we send a UU Note

to the current agent notifying them of the request. We wait 5 business days for them to take action then save the client’s information in the database of the agent requesting the change. The new agent can then issue the policy as new business. A $25 fee is assessed to cancel the old policy and move money to the new policy.

J. Motor Vehicle Reports There is no charge for MVR’s pulled in our system as long as 75% of the

reports end up on a policy that is issued and premium is paid. Any reports pulled on business that is below a 75% success rate will be charged to the agency. $9.50/report pulled.

PLEASE NOTE: If United Underwriters pays a claim and the driver of the claim is deleted, a permissive driver claim surcharge is added to the named insured.

K. Fees

The following fees will be charged in addition to policy premiums. (Fees are fully earned when we issue the policy or endorsement.) 1. a. Installment Fee (Each payment) $ 6.00 (Policies submitted with payment in full but are issued higher than quoted will also be subject to this fee.) b. Installment Fee- Sure Pay (Each Payment) $ 3.00 2. Re-instatement fee $10.00 3. Returned Check Charge $20.00 4. Insured request Cancellation Fee $25.00 5. Late Payment Fee (2 notice bill plan) $ 5.00 6. Expense Fee

$25.00



II. COVERAGE

A. Liability

Liability limits are available up to $500/500/100. All liability limits MUST be the SAME on ALL vehicles of a multi-car risk.

B. Personal Injury Protection (PIP) – [PP 05 79]

Basic PIP coverage is included in the Liability premium. Increased Personal Injury Protection limits are available for an additional premium. Refer to rate manual for available limits and premiums.

C. Uninsured/Underinsured Motorists Bodily Injury - [PP 04 66]

Uninsured and Underinsured motorists bodily injury coverage at the basic limit of 25/65 and 10/20 respectively are automatically included on all liability policies. If the insured elects to reject the coverage, a properly signed rejection MUST be on the application or the appropriate premium will be charged. UM/UIM must be written at the same limits as BI/PD unless a rejection of higher limits is signed. See the rate pages for the premium.

D. Uninsured Motorists Property Damage – [PP 04 24]

Uninsured Motorists Property Damage coverage must be offered to an applicant for any private passenger rated vehicle that is being insured for liability coverage only. The offer need be made only once and is not required for subsequent renewals. If the insured elects to reject the coverage, a properly signed rejection MUST be on the application or the appropriate premium will be charged. See the rate pages for the premium.

E. Under-Insured Motorists Property Damage

Under-Insured Motorist Property Damage with a $3500 limit, is AUTOMATICALLY included with the Liability coverage on ALL policies at NO ADDITIONAL PREMIUM.

F. Rental Reimbursement

$25 per day, $400 maximum Rental Reimbursement is included in the physical damage section of the base policy. Increased limit can be obtained by purchasing Enhanced Rental Reimbursement coverage. See details under Optional Coverages section.

G. Coverage Transferred to a Rental Car If the vehicle is rented for any reason (pleasure use or to replace a vehicle involved in a loss), liability, comprehensive and collision coverage transfer to the rental car.



• Loss of use, diminished value, and administrative fees are not covered. Rental Enhancement must be purchased for these coverages to apply.

H. Physical Damage

In determining the premium for physical damage coverage, ISO symbols should be used. If physical damage is added to the policy during the term, the agent MUST inspect the vehicle and photos MUST be submitted.

III. OPTIONAL COVERAGES

A. Emergency Road Service

Emergency Road Service coverage of up to 10 miles, one (1) occurrence per policy term, is AUTOMATICALLY included with EVERY policy, at NO ADDITIONAL PREMIUM.

For additional premium coverage up to 25 miles with limit three (3) occurrences per policy term may be purchased. Refer to rate manual for rates related to this coverage.

B. Enhanced Rental Reimbursement Coverage

This coverage may be purchased if the insured wishes to increase the $25 daily and $400 aggregate limit included with base policy. Coverage and premium will be shown on the Declarations page. Enhanced Rental Reimbursement coverage must be written in conjunction with Collision and Comprehensive coverage. Refer to the rate manual for limits and rates related to this coverage.

C. Automobile Rental Enhancement – [PAE-9023]

The regular ISO coverage for non-owned auto under Part D is limited to direct loss to

the vehicle. This coverage broadens the ISO form by including coverage for any expenses for which the insured becomes legally responsible in the event of a loss. For example, diminished value and loss of use assessed by a rental agency would not be covered under the basic ISO form if the insured is found to be liable.



D. Loan/Lease Gap Coverage - [F.34545A]

In the event of a covered loss which has been declared a total loss, this coverage will pay for the amount owed in excess of the actual cash value of the covered auto. Conditions apply – See endorsement for details. Coverage and premium will be shown on the Declarations page. Rules/Requirements:

Must have a comprehensive and collision coverage on the vehicle Covered auto must be brand new (i.e., not previously titled) Coverage must be requested within six months of leasing or financing a

vehicle Apply, unless requested by insured, until the 1st renewal when the model year

reaches 6 years A lessor or lienholder can only be a financial institution, not be a private

individual Loan/Lease Gap and Equivalent Replacement Cost coverages cannot be

purchased for the same automobile If written on a prior policy, this coverage may be transferrable

Refer to rate manual for the rate related information for this coverage.



E. Original Equipment Manufacturer (OEM) Coverage - [F.34555A] Pays for the cost to repair or replace the property or part to its physical condition at the time of loss based on the cost of new parts produced by or for your covered auto’s manufacturer, provided the parts continue to be in production and distributed by or for the car’s manufacturer at the time of estimate. Coverage and premium will be shown on the Declarations page. Rules/Requirements:

Must be a “private passenger auto, pickup or van” Requires Comprehensive and Collision coverage Gray Market vehicles and/or vehicles with model year older than 10 years are

ineligible for this coverage This coverage will be removed at renewal when the vehicle Model Year reaches

10 years of age* In the event of a total loss, we will pay for the actual cash value of the car

Refer to rate manual for the rate related information for this coverage. *TRIGGERS IMPORTANT NOTICE ALERT TO CUSTOMER



F. Rideshare Coverage - [F.34550A]

Rideshare Coverage extends those coverages displayed on your Declarations page during the time period commencing when you and your covered auto are available to accept transportation requests for passengers or property for compensation through a digital network or similar connection used by a transportation network company such as Uber and Lyft, and ending when you and your covered auto are engaged in a prearranged ride. Rules/Requirements:

Must specify the vehicle(s) covered and the specific listed driver(s) The listed driver must be Preferred Driver for renewal business and clean driver

for new business Must be a “private passenger auto, pickup or van” Requires Comprehensive and Collision coverage Only period 1 covered Not available for non-owned auto Base policy requires BI/PD limit of 50K/100K/25K




G. Equivalent Replacement Cost Coverage - [F.34535A]

In the event of a covered loss which has been declared a total loss, under the provisions of this endorsement, CSE will purchase a replacement vehicle for the covered auto. Conditions apply – See endorsement for details. Coverage and premium will be shown on the Declarations page. Rules/Requirement: Must request this endorsement within one month of purchase date. The vehicle model year must be less than 1 year old at the time this coverage is added. Must be a brand new, not previously titled, “private passenger auto, pickup or van”. Remove at 1st renewal when model year is 3 years old. The customer may request earlier non-renewal. Requires Comprehensive and Collision coverage cannot be purchased in conjunction with Loan/Lease Gap coverage

Excluded vehicles:

a. motorhomes;

b. any vehicle that has less than 4 wheels or does not require government registration for street use;

c. racing or exhibition vehicles;

d. unique vehicles, including but not limited to kit vehicles, electric vehicles, specialty vehicles and replicated vehicles;

e. any vehicle that has a rated load of 4,000 pounds or greater; and

f. altered vehicles

This coverage does not apply to:

a. total losses caused by fire, theft, larceny or vandalism;

b. personal belongings contained in the vehicle; and/or

c. Leased vehicles, temporary substitute autos and other non-owned autos.




H. Medical Parts and Accessibility Coverage [F.34530A] A customized vehicle is a motor vehicle, eligible for rating as a private passenger type auto, that has been customized by the installation of one or more of the following that were not permanently installed at purchase or considered other than original equipment from the manufacturer: ➢ Wheelchair lifts and accessibility customizations;

➢ Special carpeting, furniture or insulation;

➢ Engine, drive train, suspension, mechanical or body components intended to enhance vehicle performance or appearance;

➢ Custom murals, paint, paintings or other decals or graphics;

➢ Chrome, reverse chrome, alloy or magnesium wheels or chrome engine accessories; and/or

➢ T-bar roofs, roll bars, light bars and grille guards.

Coverage and premium will be shown on the Declarations page

Rules/Requirements: ➢ Requires comprehensive coverage

➢ Additional customizing equipment coverage may be purchased on a stated amount basis in increment of $500 for any “private passenger auto, pickup or van” for physical damage coverage

➢ Strictly custom-built vehicles are not acceptable under this rule. Examples are:

• dune buggies,

• Bradley GT's,

• hot rods,

• street rods,

• home-built bodies,

• racing vehicles, and

• Vehicles considered one-of-a-kind.

Refer to rate manual for the rate related information for this coverage



IV. CLASSIFICATION & RATING

A. Driver Classification

1. Drivers who are single, widowed, separated, or divorced should be rated as single.

2. All drivers must be listed and rated on the application.

B. Vehicle Usage

Regular Use:

Regular use is defined as the use of a private passenger vehicle for social, personal and commute purposes. Vehicle must not be required for any business, occupation, or profession.

Work Use:

Work use is defined as the use of a private passenger vehicle to commute to and from work.

Business Use:

Business use is defines as individually owned vehicles used for business or light commercial purposes.

• The classes of business include, but are not limited to: company representatives, janitorial service and contractors (i.e., carpenters, electricians, plumbers, etc., as long as they do not visit more than 2 jobsites per day).

• Vehicle must be driven by the insured and not by employees.

• Vehicles regularly or frequently used beyond a radius of 50 miles, or average mileage over 20 miles per day are not eligible.

• Vehicles visiting three (3) or more jobsites in a day are ineligible.

• Vehicles titled and licensed in the corporation/business name are ineligible.

If agent is unclear about eligibility, submit the risk for approval to underwriting prior to binding.

Transportation Network Company (Uber/Lyft) usage is acceptable with Rideshare Endorsement.

* Refer to the rate manual for premium.



C. Premium Rounding

Each premium calculation (discounts, up rates, cancellations, etc.) will be rounded to the nearest penny.

D. Premium Increase Cap The 5/15/18 rates will not receive any additional capping from the 10/23/17 rate change. The first renewal after the 10/23/17 rate change will have the cap decreased by 9%. Policies with 9% or less capping will then be at the filed rate. For those few policies left with a cap, the full cap will be removed at the 2nd renewal so that all policies will be at the published rates on the 2nd renewal after a policy renewed to the 10/23/17 rates. All new policies written 10/23/17 and later do not have any capping.

This rate filing consists of several substantial pricing changes through the adoption new rating structure. . In order to temper the extreme dislocation resultant from these changes to the company’s rates, total vehicle premium change capped at 25%.

F. Discounts

Multi-Car Discount: If more than one vehicle is insured under the same policy, a discount will apply to the liability premium. All vehicles must be titled to the named insured or resident spouse to qualify. Refer to rate manual for the discount amount. Loyalty Discount: Loyalty defined as policies that have persisted with CSE Insurance Group for more than one year. The loyalty discount for all vehicles on a policy will be determined by the principal operator in the household with the most years of persistency. Refer to rate manual for the discount amount. Sure-Pay/Paid in Full Discount: A Discount will be applied when the insured pays the term premium in full at inception. Note: Premium Financing is NOT acceptable. A discount applies when insured authorizes automatic payment of premiums via savings or checking account withdrawal. Refer to rate manual for the discount amount.

Preferred Provider (Physical Damage): [PAE-9022]

A discount will be applied to the physical damage premiums if the insured chooses to add the Preferred Provider Organization (PPO) endorsement to his/her policy. The insured must sign the PPO acknowledgment on the application, confirming that he/she understands the terms and conditions contained therein. Refer to rate manual for the discount amount.

Senior Driver Discount: a discount will be applied if all residents of the household and all drivers are age 55 or older. Refer to rate manual for the discount amount. Multi-Policy Discount: The multi-policy discount is provided when there is an in-force supporting Homeowners (H03, HO4, & H06), and/or umbrella policy with CSE Insurance Group written in the name of the insured listed on the automobile



policy. The multi-policy discount is credited to the automobile policy. Refer rate manual for the discount table and amount. Total Abstainers Discount: A discount will be applied if all drivers in the household are total abstainers from alcohol and tobacco products. A questionnaire must be completed by applicant to verify compliance.

Refer rate manual for the discount table and amount.

Good Student Discount: A discount will be applied to any driver under age 25, who is a full time student, high school or university, who has a “B” average or better (3.0+ on a 4 pt. scale, 4.0+ on a 5 pt. scale) at the time of application. Most recent grade card must be submitted with application. Refer rate manual for the discount table and amount. Permit Driver Discount: A discount is available to teenage drivers listed on their parents’ policy who have a valid permit. Refer rate manual for the discount table and amount.

Public Employee Discount: A policy discount will be applied if the named insured is a public employee. Employer and Occupation must be listed on application. Documentation of public employee must be submitted to company to qualify for discount. Refer rate manual for the discount table and amount. Increased Prior limits: A discount applies to a policy if the insured can provide documentation (12 months) that their prior BI limits of liability exceed the statutory minimum of 25/65. The current liability limits must be at least 50/100. Please refer to the rate manual for the discount percentage. New Teen Discount: This discount applies if your policyholder has held a CSE auto policy for more than one year and adds an operator under the age of 20 who has had his/her license for less than 1 year. Refer to rate manual for the discount amount. Violation Free Discount: is applied to the Bodily Injury, Property Damage, Medical Payments, Comprehensive and Collision, coverage premiums. To qualify for the Violation Free Discount, the driver must not have any chargeable citations in the past 3 years. Refer to rate manual for the discount amount.

Claim Free discount: is applied to the Bodily Injury, Property Damage, Medical Payments, Comprehensive and Collision, coverage premiums. To qualify for the Claim Free Discount, the driver must not have been involved in a chargeable accident in the past 3 years. Refer to rate manual for the discount amount.



On Your Own Discount: Discount is applied to all vehicles on a policy being split from their existing household into a new household if the following qualifications are met:

• The Primary Named Insured must be a driver under the age of 25

• Primary Named Insured was an active driver on a CSE Auto Policy in their prior household for at least 12 months

This discount is 10% for the first year and fades away by 2% per year.

Refer to rate manual for the discount amount and schedule.

G. Zip Codes/Territories

Use territory in which vehicle is PRINCIPALLY GARAGED. If mailing address or residence address is different from garaging address a surcharge will be applied. Vehicle garaged out of state are unacceptable. Refer to rate manual for surcharge.

V. POLICY ADMINISTRATION

A. Policy Surcharges Minor Incidents – 1 pt. (minor violation, AF claims under $1000 Surcharge applies for EACH 1 point incident occurring during the last 3 years. Major incidents – 3 pts. (major violation, AF claims over $1000) Surcharge applies for EACH 3 point incident occurring during the last 3 years.

• Refer to rate manual for surcharges All applicable surcharges are additive.

*Policies with claims exceeding $5,000 may not be renewed in this program. *Renewal to Peak or Crown will usually be considered for 2nd Major on 1-2 vehicle policy.

B. Policy Changes & Endorsements 1. Policies will not be re-rated during their term unless:

a) Driver points are incorrect as verified by Motor Vehicle Report. Change will be made on the effective date of the policy, or the date the driver was added to the policy. Rates in effect at the inception date of the current policy term will be used.



b) Coverages, Drivers or Vehicles are added, or there is a change in marital status. Rates in effect at the inception date of the current policy term will be used.

2. Policy transactions generating less than $10.00 will be waived. These transactions will not be billed or money returned.

C. Cancellations 1. All requests for cancellation must be made in writing. 2. No back dating of cancellations without proper and required documentation. 3. All cancellations will be computed pro-rata. 4. Cancellations at "Insured's Request" require the return of the original policy,

a signed lost policy release, or named insured's dated and signed request. Cancellation will be effective the date requested, provided the company receives the request within 30 days; otherwise it will be effective the date received, subject to any advance notification required by third parties of interest. All return premiums will be sent to the insured. There will be a $25.00 fee assessed for cancellation in mid-term of the policy.

D. Reinstatements

1. If the reason for cancellation has been satisfied before the effective date of cancellation a policy may, at the option of the company, be reinstated without a lapse.

2. After the effective date of cancellation, a policy may be reinstated with a lapse in coverage for the remaining policy period at the option of the company.

3. Prior to rejecting payments the system will allow up to as many as 40 days of combined lapse during a six (6) month period in standard and a twelve (12) month period in preferred. Payments may be accepted by underwriting past the 40 day limit. Please contact underwriting for approval.

4. The system will produce a reinstatement offer giving an expiration date from 8-15 days after the day the offer is mailed depending on previous lapses. (see history)

5. If there have been excessive lapses, instead of a reinstatement offer, a final cancellation is sent and noted in the history.

6. When accepting any payment, create a receipt in the UU system to see if payment is acceptable or not.

7. In addition to lapses, underwriting reasons can affect the acceptance of payments. Remember to check for policy flags and underwriting notes.



E. Renewals

1. Approximately 30-45 days prior to expiration, a renewal notice will be sent to the insured. This will serve as an offer to renew the policy at the indicated premium.

2. Renewal information and payment of the premium must be received before expiration to be eligible for the Renewal Claim-Free Discount.

F. Non-Renewals, Cancellations

1. Renew to Standard: If this flag is marked in the system, then the policy is ineligible for preferred, but will be automatically renewed in a standard program.

2. Non-renew-Do not reinstate: If this flag is marked, the policy is unacceptable for any United Underwriters program and will be non-renewed with little if any chance of re-consideration. Late payments cannot be accepted.

3. Non-renew and Do not reinstate if UW info is not received: If this flag is

marked, the risk would more than likely be acceptable in our program and eligible for reinstatement, however, due to a lack of response to underwriting or missing information, this policy will be non-renewed unless requested information is received. Late payments are accepted until the policy reaches the end of the term on existing business or the cancellation date for new business.

Documents

PREFERRED AUTO PROGRAM CSE SAFEGUARD ......(Ed.10 2017) CSE Safeguard Insurance Company Page 7 of 21 G. Special Rules There will be times during quoting, issuing, and servicing policies