A. Purpose

The purpose of this statement is to provide guidance on insuring State-owned buildings, furniture, fixtures, and equipment against potential loss from fire and lightning, wind, hail, aircraft, riot, vehicle, explosion, smoke, vandalism and malicious misch ief, water pipe damage, theft and business interruption.

B. General Guidelines/Applicable Policies

1. Property Insurance coverage underwritten by the State Property Fire Insurance Fund of the North Carolina Department of Insurance is administered through the University's Department of Insurance and Risk Management.

2. At a minimum, all University-owned buildings and contents including transformers and substations listed with the N.C. Department of Insurance are protected against loss from fire and lightning up to the replacement value of the building which is set by the N.C. Department of Insurance. For rating and informational purposes, the Department of Insurance calculates the replacement value for a given building equal to the cost to construct a replacement building of equal quality, function and size. The Department of Insurance uses values for all State-owned buildings based on average costs for various North Carolina areas. A building loss settlement, however, depends on the actual cost of replacement, and not necessarily the value that has been calculated using the average cost.

3. Unless notified by the department or college, the Insurance and Risk Management Department utilizes the Capital Assets Management System (CAMS) current replacement new (CRN) values as the basis for the declared value on building contents for insurance purposes. Departments may and are encouraged to update their contents values as required.

4. All claim payments, through the NC Department of Insurance, have a $5000 deductible. Deductibles may vary with policies as written by commercial insurers procurred through the State's Agent of Record, North Carolina Association of Insurance Agents.

5. Boiler and Machinery coverage is provided for University boiler equipment through a master statewide policy underwritten by HSB Insurance Company subject to a $5,000 per occurrence deductible.

6. Property insurance may be purchased at an additional premium to provide coverage for additional perils including wind, hail, extended coverage, vandalism, water damage from plumbing sources, theft, and business interruption.

7. "All Risk" property insurance coverage may also be purchased by University departments. "All Risk" coverage can be written on a scheduled basis for the property categories of "Computers" or Miscellaneous Equipment". Special "All Risk" coverage is also available for University departments as a purchasing option. All forms of "All Risk" coverage are still subject to certain exclusions.

8. Covered losses are reimbursed on a replacemet cost basis based on property repair or replacement equal to property of similar, like, kind, and quality.

C. State Excess Property Insurance

1. The State Property Fire Insurance Fund (Fund) retains the risk of loss and pays covered claims up to $2,500,000 per occurrence. In excess of $2,500,000 per occurrence, the Fund purchases catastrophic property insurance coverage from commercial insurance companies. For perils other than fire and lightning, a state agency can only benefit from this coverage if primary property insurance has been purchased from the Fund.

D. Procedures

1. NCSU has the responsibility to list all state-owned buildings with the N.C. Department of Insurance and to determine the replacement value of building and contents. University departments are responsible to notify NCSU Insurance and Risk Management when a new building or contents are added to their inventory of buildings.

2. Departments may elect to update their CAMS value at anytime during the year. It is recommended that each department periodically review their CAMS listing to insure adequate coverage. Departments may also wish to add to their building and contents coverage. This can be accomplished through use of Form IRM-02, Building and Contents Coverage and Contents Value Update.

3. Fire and lightning coverage for most academic and office buildings is provided to the University through the State Property Fire Insurance Fund at "no cost."

4. Similar coverage is also provided to other University buildings/departments (those erected and/or operated from non-State fund sources) and their contents; however, premium cost is borne by the department.

5. Property losses are to be reported to Insurance and Risk Management, 515-6124, Box Number 7521, by noon of the next workday after the incident occurs. Verbal notification should be followed up with written confirmation together with repair and replacement invoices.

6. Insurance and Risk Management will file the necessary claim with the State Department of Insurance. Proceeds from the claim will be returned to the department sustaining the loss.

E. Forms

The Building and Contents Coverage and Contents Value Update form, IRM-02 may be obtained from the Insurance and Risk Management Department, and photocopied as necessary or by clicking below.

Instruction for Completion of Form
Building & Contents Coverage and Contents Value Update