Chapter 19

Which of the following endorsements covers loss or damage to a property caused by an interruption in water, communication, or power supply service? A. the utility services - direct damage coverage endorsement B. the utility services - time element coverage endorsement C. the protective safeguards endorsement D. the hired auto and nonowned auto liability endorsement

A

Mechanical breakdown coverage is A. not available in a BOP B. automatically provided in a BOP C. an optional BOP coverage D. a coverage extension of the BOP

C

The conditions that apply to an entire business owners policy are called A. common policy endorsements B. common policy exclusions C. common policy conditions D. common policy declarations

C

Which of the following is not one of the five different classes of business personal property covered? A. a tenant's improvements and betterments B. the property of others in the insured's care C. the land that the property is on D. the exterior building glass

C

Which of the following statements about a supplementary payment is not correct? A. supplementary payments do not reduce the policy limit B. supplementary payments cover up to $250 for the cost of bail bonds C. supplementary payments do not cover expenses that the insurance company incurs D. supplementary payments cover costs the insured is required to pay because of the lawsuit

C

Which of the following would not be covered under the building coverage of the business owners policy? A. additions under construction B. completed additions C. materials or equipment within 100 feet of the premises D. outdoor fences

D

Which one of the following coverages is not included in the business owners policy A. bodily injury liability B. property damage liability C. medical expense D. professional liability

D

An insured is required to have a sprinkler system and a burglar alarm installed on the premises in order to meet certain conditions of a policy endorsement. Which endorsement does the insured likely have? A. the protective safeguards endorsement B. the utility service - time element coverage endorsement C. the utility services - direct damage coverage endorsement D. the common policy conditions endorsement

A

If an insured has the preservation of property additional coverage included in their BOP, how many days does coverage apply while the property is being stored in another location? A. 30 days from the day the property was first moved B. 45 days from the day the property was first moved C. 30 days from the day the claim was filed D. 60 days from the day the claim was filed

A

The standard deductible for the business owners policy is A. $500 B. $1,000 C. $1,500 D. $2,000

A

Which of the following is an ineligible risk in the business owners policy? A. more than 100 employees B. less than 100 employees C. revenues of $6 million or less D. businesses occupying up to 35,000 square feet

A

Which of the following statements regarding the employee dishonesty optional coverage is not correct A. the insurance company will not pay for a covered loss that is discovered after 6 months from the expiration of the policy B. only a loss that occurs during the policy period is covered C. coverage of an employee is canceled immediately upon discovery the employee committed a dishonest act D. the insurance company will not pay for a covered loss that is discovered after 1 year from the expiration of the policy?

A

Medical expenses will pay reasonable expenses for first aid, medical services, and funeral services within A. 3 years of the date of the accident B. 1 year of the date of the accident C. 180 days of the date of the accident D. 90 days of the date of the accident

B

On the business owners policy declarations page, the named insured is listed as a limited liability company. In this example, all of the following individuals would be insured except A. the named insured B. the named insured's partner C. the members of the organization D. the managers of the organization

B

Personal property is covered when it is within how many feet of the premises? A. 50 B. 100 C. 200 D. 500

B

Which of the following is not excluded under business owner liability coverage? A. pollution losses caused by the insured B. liability assumed under an insured contract C. the cost of recalling the insured's product because of a suspected safety hazard D. Damage of the insured's own work

B

Which of the following losses would not be covered under the property coverage of the business owners policy? A. an insured moved inventory to another location after a tornado. 2 days later, a fire in the new location damaged that property B. a steam engine explosion at the insured's business spewed toxic chemicals onto property belonging to another company. That company's owner sued the insured for the costs to clean up the chemicals. C. when a tornado damaged a nearby business, authorities closed off the area for one week to clean up the damage. The insured lost business income during that period. D. the insured has a 5,000 square foot addition under construction when a fire starts and damages a majority of the building

B

Which of the following losses would not be excluded under the business owners policy? A. loss caused when underground water seeps through the foundation of an insured's building B. additional expense incurred when the insured's damaged building is required by a city ordinance to a completely torn down and rebuilt rather than repaired C. loss caused by a power failure that occurs on the insured's premises D. loss caused when an insured's equipment breaks down and prevents the insured from earning income

C

All of the following are common exclusions in the business owners policy except A. earth movement B. water, including flood and sewer backup C. damage caused by insects, rodents, or birds D. collapse

D

In addition to maximum floor space of 35,000, the business owners eligibility rules limit eligible risks to a maximum of A. $750,000 in annual sales B. $1.5 million in annual sales C. $3.5 million in annual sales D. $6 million in annual sales

D

There are 2 sets of conditions that apply to every policy for property coverage. These conditions are known as the property general conditions and A. the liability conditions B. the medical expense conditions C. the limits of insurance conditions D. the property loss conditions

D

Which of the following coverages are not available on the BOP? A. equipment breakdown B. business personal property C. business income D. business auto

D

Which of the following losses would be excluded under the property coverage of the BOP? A. termites damaged in an insured's building B. an employee was tricked into giving merchandise to a person who said they were there to pick up the item for the actual customer C. an error in the design specifications for an insured's building resulted in the building's collapse 6 months after construction was completed D. all of these are excluded

D