Commercial Property Coverage

An explosion in the insured's office destroys a valuable jacket owned by one of the insured's employees. The jacket was valued at $3,000. Assuming that the insured has BPP coverage and there is no deductible, how much of the loss will the insurer pay?

$2,500. Personal effects and property of others coverage extension has a $2,500 limit for each location

An insured's CPP includes the Commercial Property coverage part, Commercial Auto coverage, and Commercial Crime coverage. How many Declarations must be included

1, regardless of how many lines of insurance it contains

The insured has a BPP coverage form with 100,000 of building coverage and inflation guard coverage at 6%. If a covered loss occurs when the policy has been in effect for 219 days, how much coverage will the insured have?

103,600. The amount of the increase (6,000) is X the # of days (219) and divided by 365 days

The ACV of an insured building at the time it is damaged is 100,000 with 80% coinsurance clause. There is 90,000 of coverage on the building. The amount of the loss is 20,000. How much will the insurer pay, ignoring any deductible?

20,000 - The insured carries enough insurance to meet the coinsurance requirement, so the full amount of the loss will be paid

In the CPP, the term that refers to the combination of forms and endorsements selected by the insured for a particular line of insurance is

A monoline policy is a policy that contains a single coverage part or line of insurance. The Common Policy Condition is a required part of a CPP that includes the terms that apply to the policy

Which of the following is covered under the builders risk coverage form?

A sign attached to a covered building

Which of the following is only covered under the building coverage in the BPP coverage form if no other insurance applies?

Additions in the process of being completed are only covered when no other insurance applies

Which is covered under the outdoor property coverage extension of the building and personal property coverage form?

Aircraft

What type of property may be covered under the legal liability coverage form

Any tangible property of others in the insured's care, custody or control that is described in the declarations or on a separate schedule

The builders risk renovations form, which covers only renovations under construction, is written...

As an endorsement to the builders risk coverage form

Which commercial property coverage form's limits of insurance reflect the building's increasing value during construction, as reported to the insurance company on a monthly basis?

Builders risk reporting form

Which coverage may NOT be included in a Commercial Package policy?

Businessowners

Which of the following property CANNOT be covered under a value reporting form?

Commercial buildings - BPP, stock, and personal property of others are the only classes of property that may be covered under the value reporting form

Which of the following losses is NOT covered under the water damage peril in the Broad Causes of Loss form?

Damage caused by continuous leakage from a hot water heater that occurs over a 3 week period - Water damage peril does not cover repeated damage that occurs over 14+ days

Which one of the following perils is NOT covered by the basic causes of loss form?

Failure of off-premises utility service

Which one of the following is NOT covered under the basic causes of loss form?

Falling objects

The insured's store collapses during an earthquake. Further loss occurs from a fire caused by the quake and by the theft of merchandise from the store by people who enter through the open side of the building.

Fire - Theft and earthquake are not covered under basic perils

According to the Common Policy Conditions, who is responsible for paying premiums and is permitted to make changes to the policy?

First named insured

The insured's building located on a riverbank, is insured under a BPP coverage form with the broad causes of loss form. Which of the following losses would be covered?

Interior building damage caused by water when the insured's automatic sprinkler system ruptured - Flood, water backup from a drain, and seepage of ground water through the walls are all excluded

Which one of these statements regarding coverage for prejudgment interest under the legal liability coverage form is correct?

It is paid in addition to the policy limit as a supplementary payment

Which of the following is an optional coverage that protects a unit owner against unanticipated losses to property that would normally not be covered by the condominium commercial unit-owners coverage form but for which unit owners are at risk

Miscellaneous Real Property coverage

which one of the following Commercial Property coverage forms has the covered causes of loss built into the form and does not require a separate form?

Mortgageholders Errors and Omissions coverage form

The deductible in the building and personal property coverage form applies per...

Occurrence - There is no separate deductible for each coverage

A loss is covered under the Commercial Property coverage part and another policy. The other policy is not written on the same terms as the Commercial Property Policy. In this case, the Commercial Property coverage part will pay

On an excess basis

Under the BPP form, if a covered loss occurs to someone else's property while it is in the insured's custody, who receives payment for the loss?

Payments are made to the property owner

Which additional coverage provides up to $10,000 to extract contaminants from the insured's property under certain circumstances?

Pollutant Cleanup and Removal - no more than 10,000

What is the purpose of the abandonment condition?

Prohibit the insured from turning over damaged property to the insurance company without the company's consent

Which of the following duties after a loss is only required when the insurance company requests it?

Provide the insurance company with an inventory of damaged and undamaged property

A fire started by a discarded cigarette causes drums of chemicals stored in a building to explode. The building is destroyed in the blast. What was the proximate cause?

Proximate cause is the action that produces a loss. In this case, the fire started the chain of events and made the building explode

The ACV of property is usually defined as

Replacement cost less depreciation

Under the Vacancy permit endorsement, the permit period may extend no longer than

The anniversary date of the policy

A condominium association coverage form covers BPP owned by...

The association or indivisibly by the unit owners

Which form contains conditions that apply to all commercial lines of insurance?

The common policy declarations

To insure residential condominium buildings, a condominium association would use...

The condominium association coverage form

which is not part of the coverage territory of a CPP?

The covered territory is the US, Puerto Rico, and Canada

An Insured who has made a claim for loss or damage and wishes to bring legal action against the insurance company must do so within two years after...

The date the loss occurred.

Which of the following statements concerning loss payments under the BPP coverage form is NOT correct?

The insurance company will pay losses within 5 days after the loss or damage occurs if the insured has complied with all terms of the policy

Under the terms of a value reporting form, what happens if an insured who has underreported values to the insurance company has a loss?

The insured's payment will be a proportion of what the values reported bear to the actual values on the reporting date

What is the purpose of the Pollutant Cleanup and Removal Additional Aggregate Limit of Insurance endorsement?

To establish a deductible for pollutant cleanup and removal that is equal to the coverage form's direct damage deductible

Which one of the following causes of loss is included in broad but not special?

Vandalism and sprinkler leakage are covered in both forms. Flood is not covered in either

In the BPP form, when is the insured's BPP covered while it is temporarily off the insured's premises?

While in repair shop

The special form is...

an open perils form

A cancellation changes endorsement may be required when the policy covers

buildings. This endorsement is always used when a building is covered

Under a builders risk coverage form, fixtures, machinery, and equipment used to service the building are

covered if they will become a permanent part of the building or will be located within 100 feet of the premises

A tenant's use interest in improvements and betterments is...

covered under BPP

Coverage for volcanic eruption is provided by

the earthquake and volcanic eruption endorsement

The building and personal property coverage form's limits of insurance apply

to each occurrence during the policy period