1. A. The Department provides property loss coverage for state-owned buildings on a replacement-cost basis for items actually replaced or repaired. Property loss coverage for state-owned personal property is replacement cost less depreciation. For agencies with a total appropriated and non-appropriated budget of less than $1 million, property claims will be subject to a $100 per occurrence deductible. A property deductible of $2,500 per occurrence shall apply to all other agencies.

   1. a. Subrogation collections shall reimburse the fund from which a deductible was paid up to the amount of the deductible and on a primary basis.
   2. b. No deductible shall apply to property loss coverage afforded in accordance with A.R.S. § 41-621(B).
2. B. RM shall not include the cost of labor in property loss reimbursement if state employee labor cost for repair or replacement is allocated from appropriated funds. RM shall determine whether to use state employees or contractors for repair work based upon availability.
3. C. Property loss coverage includes all state-owned property except: roads, bridges, tunnels, dams, dikes, and retaining walls.
4. D. Property loss coverage includes coverage for necessary business interruption losses resulting from an insured direct physical loss or damage to property that is self-insured pursuant to A.R.S. § 41-621.

Historical Note

Adopted effective June 12, 1989 (Supp. 89-2). Former Section R2-10-106 renumbered to R2-10-105, new Section R2-10-106 renumbered from R2-10-105(A) and (B) and amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2). Amended by final rulemaking at 23 A.A.R. 3239, effective January 8, 2018 (Supp. 17-4). Section amended by final rulemaking at 30 A.A.R. 1941 (May 31, 2024), effective July 6, 2024 (Supp. 24-2).