REPORTING ASSETS FOR INSURANCE PURPOSES

Risk Management Services (RMS)

Procedure 3

Effective Date: 07/01/2003

Last Modified Date: 01/21/2004

Procedure Description

To ensure proper insurance coverage, Risk Management Services (RMS) must be made aware of the acquisition or surplus of University property, including buildings, and must report these activities to our respective insurance carriers. This process requires effective communication within the University as well as with external partners such as the State Property Office (SPO), the State Property Fire Insurance Fund (the Fund), and our insurance broker.

Procedure Steps

Reporting New Construction and Newly Acquired, Renovated, or Demolished Buildings

The following steps are critical to the accuracy and thoroughness of our asset reporting process. Unless the department overseeing the project submits this form, neither the SPO, the Fund, nor RMS ever receives notification. The result of this omission is that no building or contents insurance coverage is placed for the new construction, or, in the event of a demolition, insurance is being paid on an asset no longer in existence.

1. For each completed project, the department overseeing the construction, acquisition, renovation, or demolition completes and forwards a Construction Reporting Form (RMS Appendix 5) to RMS.
2. RMS determines the needed property insurance coverage and submits the form to the SPO and the Fund.
3. The Fund places insurance coverage on the new property only after the notification has been received.
4. The SPO assigns a complex/asset number that is used by the Fund and RMS to identify the new property.

Using Complex/Asset Numbers

1. The complex/asset number, assigned by the SPO, is a unique identifier for each property. The University, the Fund, and the SPO all use the number to identify assets. Complex/asset numbers consist of four sets of numbers in the format 1-68-7 / 454. These numbers identify the state, the county, and the specific geographical zones in which the property is located.

Determining the Value of University-Owned Contents

1. RMS determines the insurance value of a building's contents by multiplying the assignable square footage of each occupant by one of the following seven predetermined occupancy rates, depending on how the space is used.
   1. Academic Instruction
   2. Administrative
   3. Health Affairs
   4. Information Technology
   5. Library
   6. Laboratory
   7. Miscellaneous
2. The occupancy and assignable square footage of each building are reviewed annually for accuracy. The rates will also be adjusted as needed to account for inflation or deflation.
3. The contents values derived from this formula are the values reported to the Fund, unless a department specifically notifies RMS otherwise. (This is called an "overrride"; see the next point.) Contact RMS to determine the contents insurance values being reported for department buildings.
4. If a building's contents value is significantly understated or overstated using this formula, an override value may be used. Similarly, those auxiliary departments that are charged for their insurance are allowed to report their own contents values.

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