North Dakota Insurance Reserve Fund - Blog

If you don’t frequently work with NDIRF coverage forms and applications, you might be unfamiliar with some of the terms they contain. Our new Coverage Terms Defined segment takes a look at terms that are commonly used, or commonly misunderstood, to help you further understand the value of NDIRF coverage.

NDIRF Director of Underwriting Jeff Tescher has provided answers to our stated amount coverage questions below. Tescher has 10 years of insurance underwriting experience and holds associate designations in underwriting and general insurance.

WHAT IS STATED AMOUNT COVERAGE?
The NDIRF offers stated amount coverage for only emergency services vehicles. This coverage type enables members to determine—or state—the amount for which they would like to cover their property. In the event of a covered loss, the NDIRF would pay repair costs without deduction for depreciation or the amount shown in the schedule (the stated amount), whichever is less.

Stated amount coverage is an effective coverage for emergency services vehicles because these vehicles are often highly specialized, making the owners of these vehicles better equipped to determine the appropriate level of coverage.

Stated amount coverage is different from actual cash value (ACV). Stated amount coverage is determined by NDIRF members, and ACV is generally determined by the market value of the vehicle. Under stated amount coverage, in the event of a total loss, when the cost of repairing the vehicle without deprecation is more than the amount the vehicle is scheduled for (the stated amount), the amount scheduled will be paid without depreciation.

WHAT SHOULD MEMBERS CONSIDER WHEN DETERMINING THEIR STATED AMOUNT COVERAGE?
To determine stated amount coverage, members should consider repair and replacement costs of vehicles and the normal complement of equipment they contain. Examples of the normal complement of equipment include, but are not limited to hoses, nozzles, couplings, light bars, sirens, radios, ladders, axes, fire extinguishers, water tanks, pumps, etc. Examples of equipment that would not be considered within the normal complement of equipment include helmets, turn out gear, gloves, jaws of life, smoke fans, portable generators, diving gear, cell phones, pagers, aircraft, or other vehicles that can be flown. Equipment can also be covered under public assets coverage. Members should contact their Agent of Record to review coverage options and cost estimates.

HOW CAN MEMBERS REVIEW OR ADJUST THEIR STATED AMOUNT COVERAGE?
Members should contact their Agent of Record, which is the local agent they work with regarding NDIRF coverages.