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Home Owners Ins.

Arizona Independent Insurance Adjusters Exam

In a homeowner's policy, coverage D is: Coverage for Loss of Use
The ___ ____ section of an insurance policy would cover the insured if the insured's son is playing baseball with his friends on the front yard and his son hit the neighbor in the head with a stray baseball. Personal Liability
True or False: In regards to trees and shrubs, coverage is "additional coverage" and increases the Coverage A limit of liability. TRUE
True or False: In regards to personal property items, books do NOT have a special limit of liability. TRUE
In a homeowner's policy, coverage A is: Coverage for the Dwelling
True or False: The HO-4 policy would provide coverage for the exterior siding of a dwelling. FALSE The HO-4 policy is a renter's policy.
The HO-5 is an ___ ____ policy. All Peril
Assuming no endorsements, how much coverage is given when personal property is covered anywhere in the world under a homeowner's policy? $1,000 or 10% of Coverage C, whichever is greater
A homeowner's policy is designed for ___ ____ (i.e. if a person wholly rents out their house to another, they don’t qualify for a homeowners policy). owner/occupants
A homeowners policy is a ___ ____ policy. It’s for individuals, not for businesses (e.g. corporations, associations, government entities, etc.). Personal-lines
Building eligible for homeowner's policies: a) residential dwellings with a maximum of 4 families b) residential dwellings under construction. c) mobile homes (if the proper endorsement is attached. d) the dwelling must be used exclusively for residential purposes.
Tenants (i.e. renters) are ___ for a homeowners policy. Eligible
The essential parts of a policy can be remembered by “D.I.C.E.” Declarations Insuring agreement Conditions Exclusions
The first page of a policy is called the _____ or “Dec” page. It lists all the important facts that are particular to the homeowner and his/her property: Declarations
Following the Dec page, the very next page of a homeowners policy is typically the “________” section Definitions
a homeowners policy is a “____ _ ______” (which just means that the insurer wrote the policy and controlled the wording, so if there’s an ambiguity, it falls in favor of the insured). "Contract of Adhesion"
“you” or “your” means: The Insured
“we” or “us” means: the insurance company, a.k.a. the “insurer” The Insurer
a) the person or persons named on the declarations page of a policy b) residents of your household who are: a. relatives b. persons under 21 in the care of the above c) full-time students who are: a. under 21 & under your care b. under 24 & a r The "insured"
the liability section of the policy covers the insured anywhere in the _____! world
The ___ ____ is the dwelling, other structures and grounds, or that part of any other building where the named insured lives and which is identified as the residence premises in the policy) residence premises
The ___ ____ states, “we’ll provide the coverage described below in exchange for your premium and compliance with the conditions below.” Insuring Agreement
There are a number of different ___ ____, called homeowners “forms”, and often expressed as “HO” (e.g. “HO-3” is a Homeowners form 3). homeowner policies
the Broad form – usually referred to as the “cheap” form, but it has more coverage than the HO-8. HO-2
the Special form – the most common, the middle-of-the-road form HO-3
the Tenants form – this is a special contents-only policy for renters HO-4
The Deluxe Form – a high-end form, more expensive, and gives the best coverage HO-5
The Condo form – a policy for condominium unit owners HO-6
The Modified Coverage form – the most limited coverage form HO-8
A ____ is a possible cause of a loss – e.g. fire, theft, hurricane, flood, hail, etc. “peril”
An ___ _____ (sometimes called “open-perils”) covers all causes of loss (unless it’s excluded in the exclusions section of the policy). All-Peril policy
A ___-____ policy only covers losses caused by the perils listed in the policy. A ___-___ policy will actually state something like “we cover physical damage to the property caused by the following perils: fire, lightning, wind, etc. Named-Peril
The ___ is an All-Peril policy for all types of property, whether it’s the building(s) or the insured’s personal property. HO-5
HO-2, HO-4, HO-6 and HO-8 are ___-___ policies. Named-Peril
The ___ policy falls in between the two categories, because the ___ gives all-peril coverage for buildings, but named-peril coverage for the insured’s personal property. HO-3
____ _____ coverage is more expensive because it pays the entire cost to replace a damaged item at current market cost. Replacement Cost (RC)
___ ____ ____ coverage is less expensive, because it deducts “depreciation”. That is, if there’s a loss, the insurer deducts a percentage based on wear, tear and age. Actual Cash Value (ACV)
The ___, ___ and ___ have both RC and ACV coverage, depending on what type of loss it is. HO-2, HO-3 AND HO-5
The requirement that the insured have at least 80% of the replacement cost of the property. Co-insurance
If the insured is ___-____, his/her settlement will be diminished by the percent that he/she is ___-____. under-insured
The ___ designed to cover dwellings that would cost more to replace than the market value of the dwelling. It’s a named-peril policy with actual cash value (ACV) coverage for building and contents. HO-8
No homeowners policy covers ____ damage. Flood
Nuclear war or fallout Earth Movement Neglect Ordinance or law Off-premises power outage Intentional acts (e.g. arson by the insured) Flood Homeowner's policy exclusions
The major categories of coverages in a homeowners policy are: 1. Coverage A – dwelling 2. Coverage B – other structures 3. Coverage C - contents (also called personal property) 4. Coverage D – loss of use
This is coverage against loss to the principal structure on the property (e.g. if you suffer fire loss to the house, it’s covered under _____ _. Coverage A
_____ __ covers structures attached to the dwelling. (e.g. attached garage or lean-to) Coverage A
This covers materials and supplies located on or next to the “residence premises” used to construct, alter or repair the dwelling or other structure on the “residence premises.” Coverage A
This covers items that directly service the principle structure (e.g. the air-conditioning compressor, heating oil tanks, water softeners, etc.) Coverage A
This is coverage for structures other than the principle structure that are located on the insured premises (e.g. detached gazebo, detached garage, sheds, fences, mailboxes, etc.). The amount of coverage is a percentage of coverage A. Coverage B
The homeowners' policy states the following about coverage B: “this is ____ ____”. Additional Insurance
This coverage is for property owned or used by the insured. Coverage C – Personal Property
Other names for ___ _ include “Contents” and “UPP”. UPP stands for “Unscheduled Personal Property” (unscheduled means that it’s not specifically listed; rather, it’s just under the blanket Coverage C coverage). Coverage C
Losses to ____ _____ while it’s off the residence premises are limited per claim to $1,000 or 10% of Coverage C. personal property
When a homeowner suffers a loss, such as hurricane damage, they may not be able to use their property, and - for this reason - they may incur additional expenses (e.g. hotel, restaurant food, etc.) These expenses fall under_____ _ -___ __ ____. Coverage D - Loss of Use.
___ _ is referred to as “Additional Living Expense” (ALE) or “Fair Rental Value”, depending on the policy type. Coverage D
_____ _____coverage pays for temporary repairs made to protect the property until permanent repairs are made (e.g. the cost to install a tarp on a damaged roof). “Reasonable Repairs”
In regards to Additional coverages, Collapse is not covered if caused by: · settling · cracking · shrinking · bulging · expansion
the insured has ___ days to recoup recoverable depreciation. 180
When the insured and the insurance company disagree about how much is owed for a claim, the policy’s conditions section dictates that either party can ask for _____. Appraisal
Appraisal requires that both parties choose an “appraiser”, and both appraisers choose an ____. All three of them get together and a decision is made about the amount. umpire
This section defines how the mortgage company’s rights are protected, etc. (e.g. if the insured burns their own house down, the mortgage company still gets paid, but the insured doesn’t!). Mortgagee Clause
Part II of the homeowners policy is the section that details the ___ ___. Liability coverage
The homeowners policy has two parts. Part II deals with: ALL below: a) liability insurance b) property insurance c) casualty insurance d) excess insurance
Insurance is a ___-___ contract – the first party is the insured, the second party is the Insurance Company. Two-Party
____ is coverage for the insured for harm to people other than the insured who might make a claim against the insured. Liability
bodily harm, sickness, disease or death. Bodily injury
physical damage to tangible property (including loss of use of that property) Property Damage
___means an accident, but also includes repeated or continuous exposure to harmful conditions (i.e. a roomer may sue you for alleged harm due to fumes) Occurrence
This coverage pays on behalf of the insured when he/she is legally liable to pay others for injury to their body or their personal property. This includes “premises liability” and “personal activity” liability Coverage E – Personal Liability
The minimum limit for coverage E is : $100,000
The insured’s actions must be ____, even in some small way, for this coverage to respond. That is, it must be at least in part the insured’s fault “negligent”
Coverage E also covers the insured’s ___ ____ fees to defend the insured against a claim against them by a third party. legal defense
Coverage F is “_____” coverage; this means that the insurance company can use it to pay for medical bills incurred by people other than the insured without regard to the insured fault or negligence. voluntary
The minimum limit for Medical Payments is $1000
If the claim is filed within __ years of the occurance, Medical Payments may cover: i. Medical care ii. Dental services iii. Ambulance and hospital services iv. X-rays v. Funerals 3
bankruptcy of the insured does ___ relieve the insurance company of their obligations under the policy (e.g. if someone sues the homeowner and the homeowner declare bankruptcy, the insurance company is not off the hook not
The typical homeowners policy has only _____ Ordinance or Law coverage. For an additional premium, this endorsement increases the amount of coverage for additional losses based on the enforcement of an ordinance or law. $5,000
The ____ _____endorsement makes sure that the level of insurance is always adequate, so that a co-insurance penalty never applies. Inflation Guard
For an additional premium, a homeowner can add the ____ _____ _____ ____ endorsement. It increases coverage from ACV to replacement cost settlement on personal property (and also on fences, wall-to-wall carpeting, etc. Personal Property Replacement Cost
Created by: ajramirez1969
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