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(4) Discovery of willful or grossly negligent <br />acts or omissions, or of any violations of <br />state laws or regulations establishing <br />safety standards, by you or your <br />representative, which materially <br />increase any of the risks insured <br />against. <br />(5) Failure by you or your representative to <br />implement reasonable loss control <br />requirements, agreed to by you as a <br />condition of policy issuance, or which <br />were conditions precedent to our use of <br />a particular rate or rating plan, if that <br />failure materially increases any of the <br />risks insured against. <br />(6) A determination by the Commissioner of <br />Insurance that the: <br />(a) Loss of, or changes in, our <br />reinsurance covering all or part of <br />the risk would threaten our financial <br />integrity or solvency; or <br />(b) Continuation of the policy coverage <br />would: <br />(i) Place us in violation of California <br />law or the laws of the state where <br />we are domiciled; or <br />Threaten our solvency <br />(7) A change by you or your representative <br />in the activities or property of the <br />commercial or industrial enterprise, <br />which results in a materially added, <br />increased or changed risk, unless the <br />added, increased or changed risk is <br />included in the policy. <br />b. We will mail or deliver advance written <br />notice of cancellation, stating the reason <br />for cancellation, to the first Named <br />Insured, at the mailing address shown in <br />the policy, and to the producer of record, <br />at least: <br />(1) 10 days before the effective date of <br />cancellation if we cancel for <br />nonpayment of premium or discovery of <br />fraud; or <br />(2) 30 days before the effective date of <br />cancellation if we cancel for any other <br />reason listed in Paragraph 3.a. <br />B. The following provision is added to the <br />Cancellation Common Policy Condition: <br />7. Residential Property <br />This provision applies to coverage on real <br />property which is used predominantly for <br />residential purposes and consisting of not more <br />than four dwelling units, and to coverage on <br />tenants' household personal property in a <br />residential unit, if such coverage is written <br />under one of the following: <br />Commercial Property Coverage Part <br />Farm Coverage Part — Farm Property — Farm <br />Dwellings, Appurtenant Structures And <br />Household Personal Property Coverage Form <br />a. If such coverage has been in effect for 60 <br />days or less, and is not a renewal of <br />coverage we previously issued, we may <br />cancel this coverage for any reason, <br />except as provided in b. and c. below. <br />b. We may not cancel this policy solely <br />because the first Named Insured has: <br />(1) Accepted an offer of earthquake <br />coverage; or <br />(2) Cancelled or did not renew a policy <br />issued by the California Earthquake <br />Authority (CEA) that included an <br />earthquake policy premium surcharge. <br />However, we shall cancel this policy if the <br />first Named Insured has accepted a new or <br />renewal policy issued by the CEA that <br />includes an earthquake policy premium <br />surcharge but fails to pay the earthquake <br />policy premium surcharge authorized by the <br />CEA. <br />c. We may not cancel such coverage solely <br />because corrosive soil conditions exist on <br />the premises. This restriction (c.) applies <br />only if coverage is subject to one of the <br />following, which exclude loss or damage <br />caused by or resulting from corrosive soil <br />conditions: <br />(1) Commercial Property Coverage Part — <br />Causes Of Loss — Special Form; or <br />(2) Farm Coverage Part — Causes Of Loss <br />Form — Farm Property, Paragraph D. <br />Covered Causes Of Loss — Special. <br />C. Thefollowing is added and supersedes any <br />provisions to the contrary: <br />Nonrenewal <br />Subject to the provisions of Paragraphs C.2. <br />and C.3, below, if we elect not to renew this <br />policy, we will mail or deliver written notice, <br />stating the reason for nonrenewal, to the first <br />Named Insured shown in the Declarations, <br />and to the producer of record, at least 60 <br />days, but not more than 120 days, before the <br />expiration or anniversary date. <br />We will mail or deliver our notice to the first <br />Named Insured, and to the producer of record, <br />at the mailing address shown in the policy. <br />2. Residential Property <br />This provision applies to coverage on real <br />property used predominantly for residential <br />purposes and consisting of not more than four <br />dwelling units, and to coverage on tenants' <br />household property contained in a residential <br />unit, if such coverage is written under one of <br />Page 2 of 3 IL 02 70 09 12 <br />