Prof. Allan Manning

Product Recalls Australia – 13 March 2018

This week’s product recalls includes the following:

SRG Leisure Retail Pty Ltd — Rooftop Tent Auto Hardtop XTM (extended recall)

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Woolworths Limited — Macro Natural Sunflower Kernels 500g

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PS Importers — Piaggio Fly 150 3V

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Lenovo (Australia & New Zealand) — Gen5 X1 Carbon Notebooks

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Kmart Australia Ltd — 2 Slice Stainless Steel Toaster

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Healthy Warrior Pty Ltd — Hemp Vegan Protein Powder

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Ford Motor Company of Australia Limited — Ford Courier, Econovan and Ranger

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FCA Australia Pty Ltd — 2017 Jeep Wrangler (JK)

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Tiffany & Co — Wheat Leaf Crystal Glass Mug

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Citroen Australia — Citroen C4 Picasso

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Well done Chubb and Lockton on no longer selling Carry Guard (gun) insurance

I would like to add my support for the decision taken by insurer Chubb Insurance and insurance broker Lockton to no longer support the National Rifle Association (NRA’S) Carry Guard insurance program in the United States which did provide liability coverage for NRA members who use their fire arms in self defence.

This will leave a gap in coverage as most of the home policies I have reviewed do not offer this coverage.

This is another case in a long history for the insurance industry where they have shown a social conscience and used their influence for good.

Well done to both organisations.

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Product Recalls Australia – 6 March 2018

This week’s product recalls includes the following:

Innovations Direct Pty Ltd — Treadmill with Shock Absorption

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DCTCP Pty Ltd t/as Wild and Wolf — Musical Jumbo Wooden Xylophone

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Impulse Variety Products — Magnetic Hematite Rattlesnake Eggs

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Peugeot Automobiles Australia — Peugeot P308 (T9)

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Audi Australia Pty Ltd — Audi Q3 (8U)

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BIG W — B Collection Toddler Girls Bomber Jacket

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Hyundai Motor Company Australia Pty Ltd — Hyundai Sonata (NF) and Grandeur (TG)

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Manassen Foods Australia Pty Ltd — Sharwood’s Plain Puppodums 113g

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Looking for experienced policy drafters

Every part of LMI is growing and we are always on the look out for good people with technical skills in claims, underwriting and risk management.

One part of the organisation that continues to grow is our policy drafting area.  We have approached on a great many projects already this year.

The experts we are after include those with the skill and experience to draft wordings and or who are experts who can sign off on legal and compliance.

If you have the expertise and are looking for either project, part time or full time employment please send your CV through to me. Please advise the classes you are comfortable in and the time you are happy to commit to.

From our side, the existing team work in a collaborate supportive team environment added by the PolicyComparison, LMI Legal and LMI Claims teams.

My email is All applications will be treated with complete confidentiality.


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What legacy are we leaving for the next generation

At least once a week, sometimes more than once a day, I am referred a matter where clients aren’t being given the right advice or being unfairly messed around during a claim. I know that many brokers and retired insurance professionals are helping with the same.

I thought I would share a note I received from an old mate showing how wide spread this is:

Hi Al,

Retired I may be, but immune from insurance related questions I am not.

I’ve had three thrown my way in the last few weeks, all related to Private Motor.

First one relates to the claim process at [name withheld] Insurance. (name of parent withheld).

My bike mechanic had a T/L [total loss] a few weeks ago and was telling me about it last night.

When he rang to make the claim he was instructed to obtain a driver record from Transport QLD for he and his wife. (She was driving at the time of the accident). I understand of course that the insurer has the right to satisfy itself about these matters, but I have never heard of this before. (Client and Mrs are in their 50’s so not a high risk profile). [As we understand it there was nothing to prompt this but it is standard procedure on all such claims].

FWIIW [For what it is worth], the rest of the claims process was just crap. Apart from its being drawn out, they were told the payout would be X but then that was revised by about 10% (downwards, naturally) without explanation or apology. Then when the settlement was agreed, they were told it would take another 7 to 10 days for the EFT to hit their account. Another person disgruntled with the industry. [At no time was the client offered any complaints procedure].

The other two queries, remarkably enough, were about cover for vehicles in transit.

One was my son in law moving from Townsville to Darwin and the other was someone in Perth, moving to Mt. Gambier.

Both rang to ask me for an insurer that would cover the transit risk (by truck and train respectively) as their comprehensive insurers had told them their policies don’t cover transit, even though one of them has a General Average provision in their wording.

One was [name withheld] through [name withheld] Leasing and other was [name withheld] through [name withheld]. In both cases, I told them to ask whoever they were talking to to show them where it’s excluded in their policy (after I had read them and could not find any such exclusion).

Admittedly, in both cases, they were dealing with AR’s of the insurer rather than the underwriter, but it still took some convincing to extract an admission that they were covered. In fact, [name withheld] maintained for a while that although the transit would be covered, the loading and unloading wouldn’t be. (I finally got this sorted as well).

I find it quite distressing that there appears to be such a lamentable lack of product knowledge on the part of staff [remember this is a basic high volume product]. What happens when punters don’t have someone to ask? Both of these people would have just bought cover they didn’t need.

I am more convinced than ever that the prime focus with regard to training is around compliance rather than product.

I’m not sure if any of this is any use to you but you’re in a better position than most to ventilate these sorts of issues.

Thanks for listening,

Peter [surname and email provided]


Like many in the industry, I share Peter’s concerns. This thing called ‘insurance’ seems to be forgotten and many Insureds feel like they move from being a customer to a criminal when they have a claim and then to a cost center when they prove they are not a criminal and simply want the protection they paid for.

With the two Insureds that had received wrong advice on their motor policy, what do they think of not only their insurer but insurance as a brand. What trust has been developed in these interactions.  Will they stay with the insurers knowing that if it is this hard and they are wrongly treated before a claim what can they expect should they need to make a claim.

As the world moves more and more to the experience of customers, many insurers and the agents, assessors, builders etc they use are doing their best to destroy trust and relationships.

Thankfully there are still people like Peter out their doing his best to project our profession /industry image and give people meaningful advice. He wishes he was involved earlier in the claim situation.

Just thinking about this, if this chap is mentioning this to Peter and before the conversation as I understand it, he did not know Peter had been in insurance, how many others is he complaining about his experience to. How much of the TV ads are wasted as a result for as we know we trust people we know more than TV and big corporations.

Is it any wonder that Lemonade and others who are focusing on the customer experience are getting so much attention.

While this is a treat, it also creates opportunities for brokers, claims preparers, lawyers and others who are there to provide meaningful advice either before or after the loss.

Of course this sort of behavior only leads to more regulation (clearly needed in some areas) and opens the door for genuine disruptors.

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Vehicles requiring replacement airbags

Each week, I post a list of the items that have been recalled. Typically, these are a voluntary recall, but if something is dangerous a compulsory recall can be ordered by the Commonwealth or a State Government. Due to the reluctance of some manufacturers to carry out a voluntary recall of airbags that have reportedly killed 23 people worldwide, with one of these in Australia, plus 230 people known to have been injured around the world, many seriously, the Australia government has ordered a recall of some vehicles to have the potentially dangerous airbag replaced.

The government urges everyone effected to take this seriously, check if your vehicle is on the list below and if it is arrange to take it in for the free recall as soon as possible.

I have reviewed some of the injuries and they are horrific and involve people, including infants, of all ages. Therefore please take this one seriously and if you know anyone who drives one of the vehicles listed, please pass this on to them.


Here is the list:


It is critical that drivers with alpha airbags installed take immediate steps to have the airbags replaced because of a significant risk of injury or death involved in using vehicles with these airbags. Drivers with other recalled airbags should arrange for them to be replaced as soon as possible.

Make & model Year Range PRA No.
BMW 3 Series E46  ALPHA 12/2001 – 03/2003 2013/13576
BMW 3 Series E46 9/1999 – 8/2006 2013/13576
BMW 5 Series E39, 3 Series E46, X5 E53 2002-2005 2016/15581
BMW 5 series E39, 3 Series E46, X5 E53 2000-2004 2017/15881
BMW E70 X5, E71 X6 2007-2012 2017/16230
BMW E70 X5, E71 X6 2007-2012 2017/16298
BMW E70 X5 & E71 X6 2013 2018/16566
Chrysler 300(LE/LX) 2005-2012 2016/15516
Chrysler 300, 300C 2005-2010 2015/14742
Chrysler 300, 300C 2013 2018/16617
Dodge RAM 2004-2010 2016/15516
Ferrari 458, California, FF 2008-2011 2016/15430
Ford Mustang 2006-2014 2015/14924
Honda Accord, CR-V  ALPHA 2001-2002 2009/10969
Honda Civic  ALPHA 2001 2010/11785
Honda Accord  ALPHA 2001-2002 2011/12633
Honda Civic, Accord, Accord Euro, CR-V, Jazz, MDX  ALPHA 2001-2003 2013/13549
Honda Jazz  ALPHA 2004 2014/14438
Honda Accord Euro, Civic Hybrid, CR-V, Civic, Jazz 2003-2004 2014/14498
Honda Accord Euro, CR-V, Civic, Jazz, City 2002-2009 2015/14703
Honda Jazz, CR-V 2005-2007 2015/14702
Honda MDX, Accord 2001-2007 2015/14737
Honda City, CR-V, Insight, Jazz, Jazz Hybrid 2006-2012 2015/14819
Honda City, CR-V, Insight, Jazz, Jazz Hybrid 2011-2014 2016/15197
Honda Civic, Legend, Jazz Hybrid 2006-2012 2016/15198
Honda Accord Euro, City, CR-V, Jazz, Insight 2007-2011 2016/15496
Honda Legend, Odyssey, Accord, MDX 2003-2011 2016/15495
Honda Civic, Accord 2006-2011 2016/15494
Honda Accord Euro, City, Jazz & Insight 2012 2017/15856
Honda Legend 2012 2017/15857
Honda Accord 2012 2017/15859
Honda Civic 2001 2017/15860
Honda Jazz, Jazz Hybrid, Insight and Accord Euro 2013 2018/16523
Jeep Wrangler JK 2007-2012 2016/15516
Jeep Wrangler 2013 2018/16617
Lexus SC430 2000-2003 2013/13545
Lexus IS 250, IS 250C, 350, IS F 2005-2011 2016/15425
Lexus IS 250, IS 350, IS 250C, IS-F, LFA 2011-2012 2017/15846
Lexus IS250, IS250C, IS350 & IS-F 2013 2018/16536
Mazda2 (DE) 2010 2016/15522
Mazda2 2007-2015 2016/15521
Mazda RX-8 2008-2012 2016/15521
Mazda6, BT-50 2005-2011 2015/14761
Mazda6, RX-8 ALPHA 2002-2007 2015/14761
Mazda B2500 & B2600 2002-2011 2015/14760
Mazda6, CX-7 & CX-9 2006-2012 2017/16232
Mitsubishi GA & GB i-MiEV 2010-2011 2017/15990
Mitsubishi Lancer 2003-2008 2015/14936
Mitsubishi ML & MN Triton 2007-2014 2016/15523
Mitsubishi Pajero NS, NT, NW, NX 2007-2016 2016/15617
Mitsubishi Pajero NS & NT 2006-2009 2017/15991
Mitsubishi Pajero NT & NW 2010-2012 2017/16025
Mitsubishi Pajero NW & NX 2013-2017 2017/16465
Nissan N16 Pulsar, Y61 Patrol 2001 2010/11761
Nissan N16 Pulsar, Y61 Patrol 2001 2017/15940
Nissan N16 Pulsar, Y61 Patrol, D22 Navara, T30 X-Trail  ALPHA 2000-2004 2013/13542
Nissan N16 Pulsar, D22 Navara, Y61 Patrol, T30 X-Trail, A33 maxima  ALPHA 2001-2003 2014/14182
Nissan N16 Pulsar, D22 Navara, Y61 Patrol, T30 X-Trail, J31 maxima 2003 2015/14751
Nissan N16 Pulsar, D22 Navara, Y61 Patrol, T30 X-Trail, J31 maxima 2004-2007 2015/14752
Nissan D22 Navara, T30 X-Trail, J31 Maxima, Y61 Patrol 2007-2008 2015/14821
Nissan D22 Navara, Y61 Patrol 2009-2012 2016/15769
Nissan D40 Navara 2008-2014 2016/15228
Nissan D40 Navara 2006-2015 2017/16363
Nissan Tiida 2006-2012 2016/15383
Nissan C11 Tiida 2006-2012 2017/16363
Peformax Silverado, Sierra, Mustang 2007-2008 2015/14789
Subaru Impreza 2004-2007 2015/14715
Subaru Tribeca, Liberty, Outback 2004-2013 2016/15507
Subaru Impreza, Forester 2008-2013 2016/15766
Subaru Exiga 2010-2014 2017/16012
Subaru Liberty & Outback 2010-2014 2017/16013
Toyota Corolla, Avensis Verso, Lexus SC430  ALPHA 2000-2004 2013/13544
Toyota Echo, Rav 4  ALPHA 2002-2003 2014/14456
Toyota Echo, Rav 4 2003-2005 2015/14700
Toyota Corolla, Avensis Verso, Yaris 2003-2007 2015/14701
Toyota Avensis Verso, Yaris 2007-2008 2015/14794
Toyota Corolla, Yaris, Avensis Verso 2006-2011 2016/15709
Toyota Corolla 2003-2005 2017/15950
Toyota Corolla, Yaris & Rukus 2010-2012 2017/16010
Toyota Echo, Rav 4 2002-2003 2017/16014


Make & model Year Range PRA No.
American Honda Motor GL1800 2016/15440
Honda GL1800 Goldwing 2012-2015 2017/15906
Honda GL1800 Goldwing 2012-2015 2018/16522


Make & model Year Range PRA No.
Volvo UD Trucks Quon & Condor 2011-2016 2017/16021
Volvo FH13, FH16, FM13 & FM11 2012-2017 2018/16581
Hino 300 Series Trucks 2011-2012 2017/16006
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Product Safety Update Australia – 27 February 2018

This week’s recalls includes the following:

Yale Prima Pty Ltd — Click TV Wall Bracket

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IKEA Pty Ltd— GODIS PASKKYCKLING marshmallow candy 100g

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Ampar Holdings Pty Ltd — Upside Down Cubby Stacker Toy & Upside Down Naturals Stick Stacker Toy

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Peleguy Distribution Pty Ltd — Tiko Lighter

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MyRV Pty Ltd — Fiat Ducato II Motorhomes & Fiat Ducato II SA Motorhomes

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Chubb Fire & Security Pty Ltd — Kidde 2-3lb Mariner 5 Fire Extinguisher

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Origo & Co Pty Ltd trading as Daiso — Skin Care Products

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Origo & Co Pty Ltd trading as Daiso — Hair Care Products

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Origo & Co Pty Ltd trading as Daiso — Elastic Luggage Straps

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Origo & Co Pty Ltd trading as Daiso — Projectile Toys

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Origo & Co Pty Ltd trading as Daiso — Bath/Water Toys

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Origo & Co Pty Ltd trading as Daiso — Toys

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Origo & Co Pty Ltd trading as Daiso — Hand Cream & Hand Wash Products

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Origo & Co Pty Ltd trading as Daiso — Sunglasses

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Origo & Co Pty Ltd trading as Daiso — Assorted Makeup Products

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Origo & Co Pty Ltd trading as Daiso — Bath Toys

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Origo & Co Pty Ltd trading as Daiso — Dental Products

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Mitsubishi Motors Australia Ltd — 13-15.5MY XB ASX and 13-16MY ZJ & ZK Outlander

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Mitsubishi Motors Australia Ltd — MY 2008 – 2010 CJ Lancer & MY 2007 – 2010 ZG & ZH Outlander

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Mitsubishi Motors Australia Ltd — MY 2011 – 2012 XA ASX , MY 2008 – 2012 CJ Lancer and MY 2008 – 2012 ZG & ZH Outlander

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Mitsubishi Motors Australia Ltd — 11-15.5MY XA & XB ASX

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KitchenAid Australia Pty Ltd — KitchenAid Electric Kettle 1.7L

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Toyota Motor Corporation Australia Limited — Lexus models GS-F, LC500 & RC-F

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KTM Australia — various KTM Duke and Super Duke Motorcycles

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KTM Australia — 690 Duke & 690 Duke R Motorcycles

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Kawasaki Motors Pty Ltd — Ninja ZX-10R and ZX-10RR Motorcycles – various models

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Mercedes-Benz Australia/Pacific Pty Ltd — Mercedes-Benz “C”, “GLC”, “S” and “E Coupe” passenger cars

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Williams-Sonoma t/as West Elm — Jensen Glass Top Table

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Blog Question: Extra Cost of Reinstatement

Hi Allan, 

I am after some advice concerning older buildings and (non existent) open air hardstand areas. 

  • Their land size may be big enough to cater for, but because of the buildings age they do not have designated concreted or sealed car parks. 
  • Or their site size may not allow for in the event of a rebuild after a total loss. 

Understandably building regulations have now changed and local councils require new commercial properties to have adequate sealed open air hardstands for their size.

Where do we allow for such and how do we calculate a sum insured?  Can we insure for property that currently doesn’t exist?

I look forward to hearing back from you.


Leesa [Surname and Email provided]


My reply was:

Hi Leesa

First up top marks for identifying the risk.

With the sum insured / declared value you only should include the current replacement value of what was there. You do not include the extra cost of reinstatement (under most policies).

This is insured separately as a first loss (not subject to average) sub-limit.

On what this value should be you may need to involve a town planner to advise on the current requirements and then a good local builder or quantity surveyor to cost it.

I  hope this helps.


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Do not even think about it

Odessa Ukraine – September 20 2016: Driving cars on a flooded road during flooding caused by torrential rains. Cars float on water flooded streets. The disaster in Odessa September 20 2016.

The number of drivers that are risking their lives, the lives of others, including emergency service personnel, and their vehicles by driving into flooded roads is of increasing concern.

Some insurers have in fact started to include an exclusion in their policy refusing to indemnify for such losses which can be substantial.

I support this in an effort to have people understand the personal risk they are taking but struggle where someone does it by accident, say driving along an unfamiliar remote country road at night.

You can check who has introduced this exclusion by visiting LMI

Whether you are insured or not for this risk, my strong advice is do not even think about driving across any flooded roadway.

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Blog question – Additional Increase in Cost of Working under an ISR

I received this question which I felt was worth sharing.


I have for many years referred to your most excellent publication for guidance relative to BI [Business Interruption] insurance.

The guide makes reference to the Industry Mark IV wording and it is in respect of the Mark IV wording that I have an enquiry, where I could not locate any reference to my particular enquiry within your guide. Many clients have multiple locations, some of which generate revenue others that do not, a loss could occur at a location where revenue is not generated however the insured may need to incur expenditure to resume or maintain normal business operations. From my understanding where a location does not have any BI declared values ( for there is no revenue generated at that location ) the insured would still nonetheless be entitled to make a claim under AICOW [Additional Increase in Cost of Working] subject to the scope of cover and sub-limit. Some insurers draw the assumption that as there are no declared values at the situation then there is no BI cover, there is however no provision under the operative clause to Section 2 that provides indemnity being restricted to those locations with BI declared values.

Would you support my assessment of the application of AICOW ?

Thanking you in anticipation of your prompt attention and reply.


Ric [surname and email provided]

I answered as follows:

Hi Ric

Thanks for your note.

Unlike the Material Damage section (Section 1) of the Industrial Special Risks Policy which is tested for average/co-insurance on a location by location basis, business interruption is declared across the entire organisation.

As such the way I would do this to achieve the result you are after is:

  1. I assume the locations that have no profits but have the potential for an Additional Increase in Cost of Working claim have property that is to be insured under the ISR policy. If this assumption is correct, clearly show them in the asset schedule.
  2. I would not split up the business interruption figures by location but rather show a total for all locations on a separate line for ease of the co-insurance/average test calculation.

If the insurer(s) requires a split for reinsurance purposes then it is fine as long as the Sub-Limits are set out as follows:

Sub-Limits of Liability

The liability of the Insurer shall be further limited in respect of any one loss or series of losses arising out of any one original source or cause at any one Situation as set out hereunder: [emphasis mine].

The Sub-limits of Liability apply in excess of any applicable Deductible.

Item 2 Claims Preparation                                               $x

Item 4 (Additional) Increase in Cost of Working         $x

Etc for any other sub-limits for section 2.


This should make it clear.



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