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P&C Prop Policy Type
P&C Prop Policy Types Flash Cards
| Question | Answer |
|---|---|
| Commercial property coverage can be written with one of three causes of loss forms. What are they? | Basic, Broad, and Special |
| What businesses qualify for coverage under a businessowners policy? | Small to medium size businesses |
| A businessowners policy is mostly similar to what other insurance form? | Homeowners |
| What type of property can be covered under Inland Marine insurance? | Any type of property that is portable on land, as well as means of transportation and communication |
| What are some of the types of businesses that are excluded from coverage under a Businessowners policy? | Auto sales and servicing, large banks, bars and grills, places of amusement, and manufacturers |
| What is mysterious disappearance? | Misplacement or loss of property without knowledge as to the location, time and cause of the loss |
| How is the coverage usually written for HO-8 forms? | For the market value of the property |
| What are the 2 types of Utility Services endorsements available in Businessowners policies? | Utility Services – Direct Damage, and Utility Services – Time Element |
| How many owner-occupied residences per covered home are allowed by Homeowners policies? | An HO policy may insure a property that has 1- to 4-family owner-occupied residences. |
| What HO form insures a tenant living in an apartment? | HO-4 (tenant broad form) |
| Losses caused by vandalism and malicious mischief are excluded from coverage if a dwelling has been vacant for how many days? | 60 days |
| What are additional coverages available in Homeowners policies without additional premiums? (name several) | Debris removal, lawns/plants/shrubs, and trees, removal, reasonable repairs, and fire department service charge |
| Under Coverage C of an HO-3 policy, what is the amount of insurance provided for personal property? | At least 50% of the Coverage A limit (this applies to all policies except for HO-4 and HO-6) |
| In dwelling policies, any volcanic activity will be considered part of one occurrence if it all happens within how many hours? | 72 hours |
| What are the coverage parts that may be included in a Commercial Package Policy (CPP)? | Commercial property, general liability, crime, equipment breakdown, auto, inland marine, and farm |
| What is the maximum number of units in residential dwellings insurable by a Dwelling policy? | Up to 4 units |
| An insured with a Homeowners policy has removed property from the insured location to protect it from loss that could be caused by a covered peril. The removal coverage applies for how many days? | 30 days |
| What do dwelling policies insure? | Dwelling only, contents only, or both dwelling and contents |
| When will damage to the interior of the building be covered under the falling objects peril in the broad form of the dwelling policy? | Only if the interior damage is a direct result of exterior damage from a falling object |
| What HO form covers a historic home with replacement cost more than the market value? | HO-8 (modified homeowners) |
| What are some of the exclusions found in all 3 dwelling forms? | Earth movement, water damage, power failure, neglect, war, nuclear hazard, intentional loss, freezing of plumbing, ordinance or law, and government action |
| Where can National Flood Insurance be issued? | Only in participating, flood-prone areas |
| A businessowners policy is sold as a package. What does that mean? | Coverage includes both property and liability |
| What type of property would be covered under the Builder’s Risk Coverage Form? | The building, temporary structures, foundations, fixtures, equipment, and materials and supplies within 100 feet of the premises |
| What type of policy consists of the declarations, conditions, endorsements, and other attachments applicable to a single line of insurance? | Monoline |
| If 3 volcanic eruptions happen within 48 hours, and each contributes to property damage, how many deductibles will apply in the dwelling policy? | 1 deductible (all instances of volcanic eruptions that occur within a 72-hour period are considered 1 occurrence) |
| Replacement cost coverage is provided in both the broad and special form dwelling policies when the amount of insurance on the dwelling is what percentage? | At least 80% of the replacement cost |
| Which dwelling form provides open peril coverage on the building? | DP-3 (Special) |
| What Homeowners policy form is known as contents broad form? | HO-4 contents broad form |
| What type of coverage is included in Homeowners policies, but is not available in Dwelling policies? | Liability coverage |
| In Commercial Inland Marine policies, who transports the property of anyone who hires them? | Common carriers |
| What are the 5 coverages of dwelling policies? | Coverage A – Dwelling, Coverage B – Other structures, Coverage C – Personal property, Coverage D – Fair rental value, and Coverage E – Additional living expenses |
| What are the 3 types of coverage available in dwelling policies? | Basic, broad, and special |
| What are the 2 liability coverages included in Homeowners policy forms? | Coverage E – Personal Liability, and Coverage F – Medical Payments to Others |
| In order for forms HO-2, HO-3, and HO-5 to provide coverage, a dwelling must be insured for at least what percentage of replacement cost? | 80% |
| What components make up a Commercial Policy? | Policy cover; policy declarations; interlines endorsements; lines of insurance declaration pages; lines of insurance coverage forms; common policy conditions; lines of insurance conditions; causes of loss forms; and endorsements |
| In Commercial Package Policies (CPPs), who may cancel the policy in writing and make changes to the policy with the consent of the insurer? | First-named insured |
| Which dwelling policy coverage will insure a garage not attached to the primary insured dwelling? | Coverage B – Other Structures |
| What are some of the exclusions from coverage in all of the Homeowners forms? | Land, structures used for business purposes, animals/birds/fish, aircraft, rented property, electronic data, and motor vehicles |
| What Homeowners policy form is known as a special form? | HO-3 special form |
| Under Coverage C – Personal Property in the dwelling policy, when will a guest’s property be covered? | Only when the property is at the insured location |
| In dwelling policies, what is the purpose of the automatic increase in insurance endorsement that increases the amount of insurance by an annual percentage? | To offset the effects of inflation |
| What are the major coverages included in a Homeowners policy? | Coverage A – Dwelling, Coverage B – Other Structures, Coverage C – Personal Property, and Coverage D – Loss of Use |
| What is the purpose of interline endorsements in Commercial Package Policies (CPPs)? | They eliminate redundancy and minimize the number of other policy endorsements. |
| Which dwelling coverage form(s) will pay for the replacement cost of a dwelling? | DP-2 (Broad) and DP-3 (Special) |
| What does form HO-5 cover? | The dwelling and other structures, as well as contents and personal property |
| In general, what do Homeowners policies cover? | Dwellings used primarily as private residences |
| When can an insured cancel a Businessowners policy? | At any time by mailing a written notice of cancellation |
| An insured’s house becomes uninhabitable due to damage by a fire. As a result, the insured has to rent an apartment until repairs are made. Which type of coverage under the dwelling policy will pay for the expense of renting the apartment? | Coverage E – Additional Living Expenses |
| When would theft of property of guests and residence employees be covered under the HO-8 form? | Only while on the insured premises |
| What HO form covers condominium unit owners? | HO-6 (condominium unit owners) |
| What is the purpose of the National Flood Insurance Program (NFIP)? | To fill the gap in flood coverage left by private insurers |
| Which dwelling form is called the Broad form? | DP-2 |
| What would be considered a single accident in Equipment Breakdown coverage? | All accidents at a single location, at the same time, by the same cause |
| Under what conditions can broad theft coverage be added to a dwelling policy? | If the insured is the owner-occupant of the dwelling |
| Why does the HO-4 form not provide dwelling coverage? | HO-4 is written for a tenant residing in a rented dwelling; the tenant does not own the dwelling. |
| DP-3 (Special) is an open-peril form. What does that mean? | All perils are insured unless specifically excluded. |
| How are the dwelling and other structures covered in an HO-3 policy form? | On an open-peril basis |
| A basic dwelling policy automatically provides coverage against what? | Fire, lightning, and internal explosion |
| When other insurance is written on the same basis as a Commercial Property policy, what is the insurer obligated to cover? | A share of the loss |
| Assuming the insurer and the insured agree on the amount payable for a loss covered under a dwelling policy, how soon after receiving the proof of loss must the insurer pay the claim? | 60 days |
| In dwelling policies, within how many years of a loss may an insured bring a lawsuit against the insurer? | 2 years |
| What type of policy is a Businessowners policy? | Prepackaged, stand-alone policy |
| According to the liberalization condition, if an insurer makes a change to broaden coverage in newly issued dwelling policies, how will that change affect policies already in force? | The change will apply automatically. |
| Which dwelling policy coverage will provide protection for contents damaged by fire in an insured dwelling? | Coverage C - Personal Property |
| Which of the 3 DP forms provides the most limited coverage? | DP-1 (Basic) |
| What are extended covered perils on a basic Dwelling policy? | Windstorm or hail, explosion, smoke, aircraft and vehicles, riot or civil commotion, volcanic eruption, and vandalism and malicious mischief |
| What is the name for policy endorsements that may apply to more than one coverage part? | Interline endorsements |
| When a dwelling policy is cancelled for nonpayment of premium, the insurer must give notice within how many days of the cancellation? | 10 days |
| What is the limit that the insurer will pay for all losses that occur during a policy period? | Aggregate limit |
Created by:
Chase1life
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