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Dwelling Fire Policy

Ga P & C Insurance Exam- Dwelling Fire Policy

QuestionAnswer
What are four reasons a home could not qualify for homeowner's policy? 1. low value 2. old structure not renovated 3. undesirable location 4. rental house (no exceptions)
What are the first 3 sections of a dwelling fire policy? 1. Decl page 2. Coverages 3. Other coverages
What distinguishes a residence from a commercial residential structure? residence has 4 or less family units
What must a mobile home have to be a residence? permanent location with perm address (no wheels)
Is a house on a farm a residence? What type of policy covers losses to a farm house? No; Farm Owner's Policy
Can a house with an office be a residence? Only if residence dominates square footage of structure
Which insured is qualified to make changes to a dwelling policy? Named insured and spouse only if he/ she resides in same household
Are named insured's contents always covered under a dwelling policy? No- only if he / she resides in the dwelling
Are a spouse and family member's contents always covered under a dwelling policy? No- only if they reside with named insured in dwelling
Are roomates' contents covered under a dwelling policy? Never (no insurable interest)
What is the geographic limit for a named insured's coverage on loss of contents under a dwelling policy? worldwide
Is a college student's contents in a dorm room covered under his / her parents' dwelling policy? only if student is < 24 yo and a full time student
What must be attached to a dwelling fire policy's decl page? What is its purpose? dwelling form; to insure a residence
List the three types of dwelling forms in order of worst to best and show reasoning. 1. Basic = DP1 (least named perils) 2. Broad = DP2 (more named perils) 3. Special = DP3 (all risk)
What are the 5 major coverages under a dwelling policy? A. Dwelling B. Other Structures C. Pers. Property D. Rental Value E. Additional Living Exp. (DOPRA)
Does coverage A- Dwelling cover damages to a garage or deck? Yes
What determines if lights, etc of a dwelling are covered under coverage A- Dwelling or under coverage C- Pers. Property? If lights etc are attached / mounted permanently to house then they are covered under A- Dwelling (i.e. carpet, light fixtures etc)
Under coverage A- Dwelling, how are loss payments calculated for DP1? DP2? DP3? DP1 uses ACV and DP2/DP3 use replacement value (determined by ins co)
Under coverage B- Other Structures, what defines an other structure? structure on same premises but separated by clear space (i.e. sep. garage, pool, util building, etc)
If no limit is set for cov. B- Other Structures at time of signing, then what is the limit? 10% cov. A limit
If more than one "other structure" is lost in one accident covered by a dwelling policy, then is the loss paid per building (max limit for each structure) or per occurrence (aggregate limit for all other structures)? per occurrence (limit applies to all aggregated since all lost in one incidence)
Under a dwelling policy's cov. C- Pers. Property, how is the limit determined? Is it an automatic % of Cov A if not set that way? declared by insured in appl; No
1. What determines the actual amt paid to insured in case of loss covered under Cov. C- Pers. Property? 2. With what payment method are losses handled under cov C (all forms)? 1. inventory submitted by insured at time of claim processing 2. ACV
Under a dwelling's cov. D - Rental Income, what must happen for loss of rental income to be covered? There must be a covered property loss that caused the loss of rental income (i.e. lightning striking house)
How is the limit for cov D- Rental Income determined for a dwelling policy? set at appl. or if not then automatically 10% Cov A
Define additional living expenses w/ respect to cover. E of a dwelling policy. temporary living exp over and above normal living exp and only when caused by a covered loss (i.e hotel, meals out)
Would mortgage payments be eligible for coverage under Cov. E- Additional Living Exp? No (regular expenses not covered)
Who does ins. co pay for reimbursement of additional living exp? pays directly to merchants (i.e hotel etc)
If no limit is set for cov. E- Additional Living Exp at time of signing, then what is the limit? 10% Cov. A
Is cov. E- Additional Living Exp available for all dwelling policies without an endorsement? No- only policies with dwelling forms DP2- Broad and DP-3 Special
What perils are always covered under a dwelling policy with DP1- Basic form? only fire, lightning and internal explosion
Can the three named perils list be expanded upon to include more perils covered? If so, How? Yes - with an Extended Coverage Perils Form (EC Form)
What additional perils can be added to coverage on a DP1- Basic dwelling form? 1. Wind 2. Hail 3. Aircraft 4. Vehicle 5. External Explosion 6. Smoke 7. Civil Commotion 8. Riot (W HAVES CR)
What distinguishes a civil commotion from a riot? A civil commotion occurs when a celebration gets out of hand. A riot occurs when 3 or more angry people intend to do damage to property (i.e. looting)
What distinguishes vandalism/ malicious mischief from a riot? vandalism is <3 people who damage property without reason; riot occurs when 3 or more angry people intend to do damage to property (i.e. looting)
Can vandalism / malicious mischief be covered under a Basic DP1 dwelling form? If so, How? Yes; attach a Vandalism / Malicious Mischief Form
Can cov. E- Additional Living Exp ever be covered with a basic DP1- dwelling form? Yes, but only with an endorsement
What is the chief difference between the DP1- Basic and DP2- Broad dwelling forms? DP2 covers all named perils covered by DP1 + automatic coverage for some perils that must be endorsed with DP1 and some perils that are not available at all with DP1- Basic.
What is the difference between a sudden discharge of water and a flood? A flood is a rapid rise in SURFACE H2O
Is the DP3- Special dwelling form named peril or all risk coverage? All risk
What is the chief dif between the DP2- Broad and DP3- Special dwelling forms? pers prop coverage: theft covered with DP-3 w/ endorsement but only damage from burglar covered on DP-2
What are the 2 types of theft of Contents Endorsements available with a DP-3? 1. Broad Theft Endorsement (Owner on premises' contents only) 2. Limited Theft Endorsement (Landlord on premises' property only)
Is damage from termites covered under a DP-3 Special Form? No; Must purchase a Termite Bond (not part of policy)
Under the section "Other Coverages" of a dwelling policy, What does removal coverage refer to and What is the length of coverage for each dwelling form? removal coverage applies to insured's contents that have been moved to a new location after suffering a loss at dwelling (i.e. fire); 5 days for DP1 and 30 days for DP2/ DP3
Under the section "Other Coverages" of a dwelling policy, what does debris removal coverage refer to and what is the limit? debris left on premises after a loss; 5% Cov. A
Under the section "Other Coverages" of a dwelling policy, what is the limit on worldwide personal property coverage? max 10% Cov. A
Under the section "Other Coverages" of a dwelling policy, what types of communities need Fire Dept Service Charges coverage? What is the limit and deductible? small towns with volunteer fire dept; max $500 / NO deductible
Under the section "Other Coverages" of a dwelling policy, which dwelling forms are covered by Lawns, Trees, Plants & Shrubs coverage? only DP2 and DP3
What is the max limit to be paid for a loss of one tree under DP2/ DP3? For more than one tree? $500; max 5% Cov. A
Are wind-damaged trees covered under section "Other Coverages" of a dwelling policy? Lightning damaged trees? No; Yes
Which fire dwelling policy is All Risk? Which has the most named perils? DP3; DP2
For the A- Dwelling Coverage section of a dwelling fire policy, which dwelling forms pay losses via ACV and which via replacement cost? DP1 uses ACV and DP2 and DP3 use replacement cost if insured a min. 80% of value
If a dwelling suffers a loss and is covered for < 80% value, then how are loss payments calculated? Pay largest amt among the ACV and coinsurance limits
For the C- Personal Property section of a dwelling fire policy, which dwelling forms pay losses via ACV and which via replacement cost? All pay via ACV
What is the only catastrophic loss that can be endorsed on dwelling forms (all three)? Earthquake Endorsement
Do dwelling forms include liability coverage as a main coverage? No, but can be endorsed with Personal Liability Endorsement (Premises Liab. End. for landlord)
What are the two main sections of a Personal Liability Endorsement? 1. Cov. L- Personal Liability 2. Cov. M- Medical Payments to Others
What types of pers liab damages are covered with a Pers. Liability Endorsement and what is required on part of the insured? Only covers bodily injuries and pers. prop. losses to 3rd parties and only when insured is at fault / negligent.
What types of damages are covered with a Dwelling policy's coverage M- Med Payments to Others? Is the insured required to be negligent? Treatment for injuries within 3 yrs of accident on premises involving invited guests and employees (NOT roommates, tenants); no negligence required
What is the deferred limit to Cov. M- Med Payments to others and can it be raised? $1k per person, per occurrence; Yes- at signing with higher premium
Created by: jkbick