Shipping University property creates special insurance issues that departments must consider prior to actual shipment date.\u00a0 There are different requirements for NAU-owned property verses non-owned property (personal property owned by others) when NAU departments assumes handling\/packing and shipping responsibilities.<\/p>\n
University-owned property is covered by State Risk Management.\u00a0 This coverage is comprehensive on an all risk basis for insurable losses anywhere in the world.\u00a0 Coverage is on an actual cash value basis (ACV = cost to replace like-type property minus age of property) for property loss of $100 or more. The purchase of additional shipping insurance for University-owned property is usually not necessary, provided a loss event can be properly documented.<\/p>\n
If an insurance loss occurs to University-owned property during shipment, departments have the burden of proving to the State adjuster the following:<\/p>\n
It is common for the University to ship non-owned property that is in the University\u2019s care, custody, and control.\u00a0 Examples include equipment or collections that are on loan or rented to NAU, and gifted property shipped before title transfers to the University.\u00a0 Specific written conditions with the lender or donor often indicate shipping arrangements.<\/p>\n
If NAU is accepting title to gifted property prior to shipping, then the NAU department accepting the gift should take control of the shipping process to ensure proper record keeping in the event of a loss.<\/p>\n
State Risk Management can insure non-owned property under the University\u2019s property coverage only if there is a written contract, lease, or agreement that assigns the responsibility for insurance to the University.\u00a0 The written contract, lease, or agreement must clearly identify the property to be covered (make\/model, date of purchase, value, owner), and define the basis on which any loss will be valued.\u00a0 Without a written contract, lease, or agreement, State Risk Management has no obligation to insure the non-owned property, and will deny any claims that arise.\u00a0 University contracts, leases, or agreements must meet ABOR requirements, and may only be signed by authorized NAU Contract Administrators.<\/p>\n
Although statutory State insurance coverage for shipments is available as described above, some departments may wish to purchase full replacement coverage from shippers anyway.\u00a0 The full cost of such insurance must be borne by the department.\u00a0 However, prior to purchasing insurance from the shippers, the department must request authorization from State Risk Management.\u00a0 For more details, contact Risk Management at 523-2009.<\/p>\n
The benefits of purchasing insurance include the following:<\/p>\n
The disadvantages of purchasing insurance include:<\/p>\n
State Risk Management advises departments to either not purchase insurance or purchase insurance to the full value of the item being shipped.<\/p>\n