AD Banker PNC Chapter 9
Under the Building and Personal Property Coverage Form, what limit of insurance applies when coverage is extended to cover business personal property temporarily away from the premises? A $10,000 B $15,000 C $2,500 D $5,000
A $10,000
ABC Industries has insured a factory building for $80,000. The replacement value is $150,000. If the commercial property policy insuring the building has an 80% coinsurance clause, how much will ABC's insurer pay for a $12,000 covered loss? A $8,000 B $9,600 C $12,000 D $10,000
A $8,000
Under the Business Income Without Extra Expense Coverage Form, coverage is NOT provided for: A Relocation expenses B Net income that would have been earned if the loss had not occurred C Normal operating expenses D Payroll
A Relocation expenses
All of the following are Commercial Property Conditions of a CPP, except: A Liberalization B Premiums C No Benefit to Bailee D Control of Property
B Premiums
How much can be paid under the Business and Personal Property Coverage Form for debris removal due to a covered loss? A 15% of Coverage A B $5,000 C 25% of the loss amount D $1,000
C 25% of the loss amount
When an insured has time element coverage for loss of business income, coverage is provided during the period of restoration, which begins at what time? A Immediately after the loss B 168 hours after the loss C 72 hours after the loss D 7 days after the loss
C 72 hours after the loss
Collapse is not covered under which of the following property forms? A HO-2 B DP-3 C Causes of Loss - Basic Form D Causes of Loss - Broad Form
C Causes of Loss - Basic Form
Under the Builders Risk Coverage Form, coverage for fixtures, machinery, and equipment used to service the building is provided if: A They are intended to be located within 150 feet of the premises B The insured adds coverage by endorsement C They are rented or leased to the insured D They are intended to be permanently located in or on the described building
D They are intended to be permanently located in or on the described building
As provided by the Common Policy Conditions of a Commercial Package policy, insurers may examine and audit an insured's books and records at any time for up to how many years after policy termination? A Two years B One year C Five years D Three years
D Three years
Which of the following forms cannot be added to a Commercial Package policy? A Commercial Inland Marine B Commercial Auto C Commercial General Liability D Workers' Compensation
D Workers' Compensation
Under the Business Income Coverage Form, the period of restoration for business income coverage begins how long after the time of loss? A 72 hours B 48 hours C 24 hours D Immediately
A 72 hours
The Building and Personal Property Coverage Form considers all of the following to be covered property, except: A Automobiles held for sale B Personal property of others C Business personal property owned by the insured D Commercial buildings owned by the insured
A Automobiles held for sale
An insured uses the Building and Personal Property Coverage Form for insurance on their commercial building. Building coverage provided by the form would cover direct loss to: A Completed additions B Outdoor antennas and fences C Underground pipes, flues, and drains D Wharves or docks
A Completed additions
Which is NOT a Common Policy Condition under a Commercial Package policy? A Liberalization B Transfer of Your Rights and Duties Under This Policy C Premiums D Inspection and Surveys
A Liberalization
Which commercial property endorsement offers the best method of insuring a store's holiday inventory? A Peak Season Limit of Insurance Endorsement B Value Reporting Form Endorsement C Excess Inventory Endorsement D Fluctuating Inventory Endorsement
A Peak Season Limit of Insurance Endorsement
A commercial property is insured on a Commercial Package policy. When considering the insurability of the property for renewal, the insurer can use: A Physical inspection B Price of company stock C Lie detector test D Police records
A Physical inspection
If an insurer cancels a Commercial Package policy, the premium will be refunded on a: A Pro rata basis to the first named insured B Short-rate basis to the first named insured C Short-rate basis to any named insured D Pro rata basis to any named insured
A Pro rata basis to the first named insured
An insured owns a commercial building worth $400,000 and insures it for $350,000 on a commercial property policy written on the Building and Personal Property Coverage Form. If the insured plans to construct a new building on the premises, coverage for the newly constructed property is: A Provided by a Coverage Extension for up to $250,000 B Provided under the limit of insurance applying to the policy's building coverage C Not provided by the policy D Provided by an Additional Coverage for up to $100,000
A Provided by a Coverage Extension for up to $250,000
A commercial building and the business personal property located at the premises is covered under a Building and Personal Property Coverage Form. If the building is vacant for more than 60 consecutive days immediately before the loss, damage or loss by all of the following perils is excluded from coverage, except: A Sinkhole collapse B Sprinkler leakage C Water damage D Theft
A Sinkhole collapse
A Commercial Package policy includes the Building and Personal Property Coverage Form and business interruption coverages. The policy would include all of the following conditions as Commercial Property Conditions, except: A Transfer of Your Rights and Duties Under This Policy B Other Insurance C Transfer of Rights of Recovery Against Others to Us D Legal Action Against Us
A Transfer of Your Rights and Duties Under This Policy
A commercial property is insured on a $400,000 Building and Personal Property policy with a $1,000 deductible. A fire breaks out on the loading dock, causing $80,000 in damage and $20,000 in debris removal expenses. What is the maximum that may be received for the loss? A $100,000 B $99,000 C $400,000 D $90,000
B $99,000
Business personal property is protected by the Business and Personal Property Coverage Form if it is in or on a described building or structure, or if it is located in the open within: A 200 feet of the premises B 100 feet of the premises C The distance specified in the Declarations D 500 feet of the premises
B 100 feet of the premises
The Causes of Loss - Basic Form applicable to commercial property policies covers direct damage caused by bacteria during what period of time following policy inception? A 6 months B 12 months C 24 months D 18 months
B 12 months
The Building and Personal Property Coverage Form is used to insure property belonging to ABC Company, with a building limit of $1 million and an 80% coinsurance requirement. After a major fire loss, the company incurs expenses to remove debris. The limit of insurance available to cover debris removal expenses is equal to what percentage of the amount of the direct fire loss? A 10% B 25% C 5% D Debris removal coverage is not provided by the form
B 25%
Coverage provided by the Builders Risk Coverage Form automatically ends at the earliest of all of the following, except: A Policy expires B 60 days after construction is complete C Property is sold D Property is abandoned
B 60 days after construction is complete
Under the Building and Personal Property Coverage Form on a Commercial Package policy, all of the following are eligible for coverage, except: A Animals held for sale that are located inside a building B Accounts, bills, money, or securities C Completed additions D Personal property owned by the insured and used to service and maintain the building
B Accounts, bills, money, or securities
Under commercial property policies, debris removal and fire department service charge coverages are examples of: A Exclusions B Additional Coverages C Endorsements D Optional Coverages
B Additional Coverages
Which commercial property coverage form provides coverage for an indirect loss? A Building and Personal Property Coverage Form B Business Income Coverage Form C Legal Liability Coverage Form D Builders Risk Coverage Form
B Business Income Coverage Form
Unlike other Causes of Loss forms applicable to commercial property policies, the Special Form covers: A Wear and tear B Chemical damage to glass C Delay or loss of use D Rust
B Chemical damage to glass
The Causes of Loss - Broad Form attached to a commercial property policy insures against: A Damage caused by a landslide B Damage caused by civil commotion, such as employees on strike C Damaged caused by a backed up sump pump D Additional expenses incurred as a result of a construction ordinance or law
B Damage caused by civil commotion, such as employees on strike
Endorsements that coordinate Commercial Package policy coverage parts to avoid duplication are called: A Mediating B Interline C Coordinating D Special
B Interline
Which of the following is not included in the Personal Effects and Property of Others Coverage Extension available under the Building and Personal Property Coverage Form? A Personal effects owned by the insured B Loss by theft of personal effects C Personal effects owned by any partner or member of the insured D Personal property of others in the insured's care
B Loss by theft of personal effects
An insured has a Commercial Package policy with the Building and Personal Property Coverage Form. After a covered loss to a commercial building, the insured incurs increased expenses to repair the building due to the enforcement of an ordinance regulating repair. These increased costs of construction are covered by: A The Causes of Loss - Special Form only B An endorsement that must be added to the policy C An Additional Coverage D All three Causes of Loss forms
C An Additional Coverage
DEF, Inc. is a large retailer that is insured on a Commercial Package policy. The policy includes the Building and Personal Property Coverage Form with the Causes of Loss - Basic Form. If the policy does not include endorsements, the Basic Form will exclude coverage for losses caused by: A Smoke B Sprinkler leakage C Earth movement D Sinkhole collapse
C Earth movement
An insured rents a commercial unit for their business and has commercial property coverage under the Building and Personal Property Coverage Form. The unit is considered vacant when: A Less than 31% of its usual stock is contained in the unit B Less than 31% of the total square footage is used for normal operations C It does not contain enough business personal property to conduct customary operations D The insured has not visited the property in 60 days
C It does not contain enough business personal property to conduct customary operations
Under the Business and Personal Property Coverage Form, a commercial building owned by the insured is considered vacant unless at least what percentage of the building's total square footage is rented or used to conduct customary operations? A 26% B 10% C 20% D 31%
D 31%
Under the Causes of Loss - Basic Form of a commercial property policy, all of the following perils are excluded from coverage, except: A Off-premises power failure B Governmental action C Power surge D Aircraft or vehicles
D Aircraft or vehicles
Which of the following is not an Optional Coverage on the Business Income and Extra Expense Coverage Form? A Business Income Agreed Value B Monthly Limit of Indemnity C Maximum Period of Indemnity D Extra Expenses Stated Value
D Extra Expenses Stated Value
The Common Policy Conditions of a Commercial Package policy include all of the following, except: A Changes B Transfer of Your Rights and Duties Under This Policy C Inspections and Surveys D Fire Department Service Charge
D Fire Department Service Charge
Which of the following would be included in the definition of business personal property under the Building and Personal Property Coverage Form? A Business personal property of others, rented to the insured B Property used to service the premises C Accounts, bills, and currency the insured received from sales D Furniture and machinery owned by the insured Good Job!
D Furniture and machinery owned by the insured
In a Commercial Package policy, what may be added to prevent duplication of coverage? A Common Policy Conditions B Common Policy Declarations C One or more coverage parts D Interline endorsements
D Interline endorsements
When ordered by a building, zoning, or land use law, the Ordinance or Law Coverage Endorsement covers all of the following losses, except: A Demolition of the undamaged parts of a building B Increased cost of repairing damaged parts of the building C Clearance of the undamaged parts of a building D Loss of value in the damaged portion of the building
D Loss of value in the damaged portion of the building
An insured owns a commercial building and business personal property, insured on the Business and Personal Property Coverage Form with the Replacement Cost Optional Coverage. After a total loss to the building, the insured chooses to rebuild at a different location. Which of the following best describes the insurer's liability? A Because the building is in a new location, the insurer will pay up to $100,000 for the rebuilding cost B The insurer will pay the actual cash value of the building in the new location C The insurer will not provide coverage for building at a new location D The insurer will pay the amount that would have been incurred if the building was rebuilt at the original location
D The insurer will pay the amount that would have been incurred if the building was rebuilt at the original location
