Commercial Property Insurance

Pollutant cleanup and removal: This coverage is subject to a $_____ limit per policy period that applies in addition to the policy limit. The expenses must be reported to the insurer in writing within ____ days of the loss

$10,000 180

The basic form also includes the limited coverage for fungus, wet rot, dry rot, and bacteria additional coverage. Coverage is limited to $_____ for all lost or damage arising out of all occurrences of covered causes of loss that take place in a 12-month period, regardless of the number of claims.

$15,000

Commercial property insurance only covers outdoor signs attached to the building and is subject to a $____ per sign limit.

$2,500

How much coverage is available for signs attached to a building?

$2,500

The most that will be paid until electronic data coverage is $_____ for all loss or damage sustained in any one policy year.

$2,500

Suppose a tornado strikes the insured's business, resulting in $75,000 in damages to the building and $25,000 in debris removal expenses. The building is insured for $200,000 with a $5,000 deductible. The insured will receive $______ for the debris removal.

$23,750 (75,000 x 25% = 18.750 - 5,000= 23,750

New acquired or constructed property coverage extension applies to Coverage A and Coverage B. Up to $______ for each new building may be extended to cover new buildings being constructed at the same location.

$250,000

The maximum period of indemnity optional coverage limits reimbursement for extra expenses or loss of business income to no more than the amount of loss incurred during the first ____ days following the direct loss.

120

Which of the following policies became known as a "floater" since the property to which coverage was originally extended was literally "floating"?

B. Inland marine insurance

A bailee's customer policy covers A. the bailor for damage to the property when it leaves the bailor's custody B. the customer for loss to customers' property, regardless of liability C. only the bailee's legal liability for damage to customers' property D. the bailor for damage to property left in the custody of another

B. the customer for loss to customers' property, regardless of liability

All of the following statements about collapse additional coverage are true EXCEPT A. the collapse is covered if it was caused by falling objects B. the loss or damage is covered even if the insured knew about it before the collapse occurred C. collapse is defined as an abrupt falling down or caving in of the building or part of the building that results in the building being unusable D. the collapse is covered if it was caused by the weight of snow, ice, or sleet

B. the loss or damage is covered even if the insured knew about it before the collapse occurred

Sally left her fur coat at a dry cleaner to have it cleaned and returned to her. This is an example of bailment. In this example, which of the following is the bailee? A. Sally B. the fur coat C. the dry cleaner D. the insurance company

C. the dry cleaner

Coverage for the loss of business income over a period of time that results from a direct physical loss is also known as A. business loss coverage B. extra expense coverage C. time element coverage D. suspension

C. time element coverage

The _______ condition states that when the insured's amount of coverage at the time of loss does not meet the required coinsurance percentage, the company reduces the payment it would otherwise make in the same proportion as the insurance carried bears to the insurance required.

Coinsurance Coinsurance = Loss x Did Carry/Should Carry

There are two coverages available for buildings under constructions. What are they?

Completed Value Form Builders Risk Reporting Form

Which of these losses would NOT be covered under the signs coverage form? A. the insured's neon sign is damaged when vandals throw rocks at it B. a sign attached to a building is damaged when a tree falls during a thunderstorm C. the electric sign above the insured's business is destroyed in a thunderstorm D. during installation, several tubes in the insured's fluorescent sign are damaged

D. during installation, several tubes in the insured's fluorescent sign are damaged

Which of the following is NOT covered in the jewelers block coverage form? A. precious metals and alloys B. property sold but not delivered C. stock in trade D. property worn by the insured

D. property worn by the insured

Which of the following is covered under the builders risk coverage form? A. Signs not attached to the building B. Trees shrubs or plants C land D. the foundation

D. the foundation

____ ____ coverage is a coverage that reimburses the insured for expenses incurred to keep a business going after a loss caused by a covered peril. This coverage is for a business that must continue at all costs (ex. newspaper or bank)

Extra Expense

True or False: Signs not attached to the building are covered under commercial property insurance.

False Signs not attached are not covered

Inland marine insurance policies became known as "______".

Floaters

_____ _____ insurance indemnifies loss to movable or specialized types of property, historically developing as an outgrowth of ocean marine insurance.

Inland marine

The _____ _____ condition states that the insurance company will give the insured notice of how it intends to value loss within ___ days after it receives insured's sworn statement of loss.

Loss Payment 30

_____ insurance provides coverage against loss or damage to a ship.

Marine

The ____ ____ condition promises to pay losses to any mortgage or lien holders named in the declarations as their interstate's may appear.

Mortgage Holder

The ____ ____ with extra expense coverage form includes an extra expense coverage that reimburses the insured for money spent to avoid or minimize a business shutdown.

business income

The ____ ___ _____ conditions states that an act of neglect of a person beyond the insured's direction or control will not affect the insurance.

control of property

Fire department service charge pays up to $______ for a fire department service chard.

$1,000

Property off-premises extends up to $______ in coverage for covered property that is away from the described premises.

$10,000

Personal effects and property of others provides up to $______ of coverage for personal effects of the names insured, partners, and employees and personal property of others.

$2,500

Valuable papers and records -- other than electronic data pays up to $_____ to replace or restore information on damaged valuable papers and records.

$2,500

If removal casts are more than that amount or the actual loss plus the debris removal is more than the limit of the policy, then an additional $________ per occurrence is available.

$25,000

Which of the following perils/additional coverages are NOT included in the causes of loss - broad form? A. weight of ice, snow, or sleet B. nuclear hazard C. collapse D. water damage

B. nuclear hazard

The insured's accounting records are destroyed in a fire. Which of the following losses would NOT be covered under the insured's accounts receivable coverage form? A. interest on a short-term loan the insured obtains to stay in business while collections are impaired B. fees charged by the collection agency the insured hired to collect payments C. a loss that required an audit of records to prove its existence D. bill payments the insured cannot collect from customers because of damage to the records

C. a loss that required an audit of records to prove its existence

Which business income coverage form covers expenses that the insured incurs to reduce loss? A. builders risk coverage B. Personal effect and property of others coverage C. Business income without extra expense coverage D. business income with extra expense coverage

C. business income without extra expense coverage

Which of the following is covered in the equipment dealers coverage form? A. Furniture B. Automobiles C. construction equipment D. motorcycles

C. construction equipment

Which of the following is NOT a category that represents eligible risks for commercial inland marine insurance? A. commercial floater risk B. instrumentalalities of transportation or communication C. exports D. domestic shipments

C. exports

Which of the following statements about commercial inland marine insurance coverages is NOT correct? A. they are often called floaters because the insurance moves with the property as it moves. B. they usually do not require the property to be at a specific location when a loss occurs. C. they are usually written open peril instead of named peril D. they are never included in a commercial package policy

D. they are never included in a commercial package policy

A stated value, usually ___% of the amount of the loss plus the deductible, is what the policy will pay toward debris removal after a covered loss.

25%

In commercial articles coverage form additional acquired property is automatically covered for up to ___ days if it is a type of property already covered by the form. In the event of loss, the insurer will pay the lesser amount of ____% of the policy limit or $10,000.

30 days 25%

In the extra expense coverage form limits are applied to recovery depending on the period of restoration. For instance, limits might be stated in the declarations as ___%,___%, ___%. This means that if the period of restoration was: 30 days or less, ____% of the full amount of insurance would be paid 31-60 Days, ____% of the full amount of insurance would be paid Over 60 Days, ____% of the full amount of insurance would be paid

40% 80% 100%

Extended business income coverage pays for loss of business income, even after operations have been resumed, until the business has been restored, but for no more than ___ days from the date business is resumed.

60

Which of the following perils are covered in the causes of loss - basic form? A. explosion B. collapse C. volcanic eruption D. weight of snow, ice, or sleet

A. Explosion

Which additional coverage pays for the loss of business income, even after operations have been resumed, until the business has been restored, but for no more than 60 days from the date the business is resumed? A. Extended business income coverage B. Order of civil authority coverage C. Alterations and new buildings coverage D. Extended period of indemnity coverage

A. Extended business income coverage

All of the following are examples of instrumentalities of communication EXCEPT A. bailment B. tunnels C. bridges D. cell phone towers

A. bailment

Which of the following has special loss valuation requirements under the building and personal property coverage form? A. glass B. furniture and fixtures C. exterior signs D. buildings

A. glass

The builders risk reporting form requires a report of value that must be reported to the insurer every A. month B. week C. four months D. two months

A. month

The form that covers commercial, residential or farm buildings that are under construction is called A. the builders risk coverage form B. the mortgage holder form C. the newly acquired or constructed property form D. the construction coverage form

A. the builders risk coverage form

Which of the following statements regarding additional coverages in the building and personal property coverage form is NOT correct? A. The fire department service charge pays up to $500 B. Extraction of pollutants from land and water is covered C. The debris removal coverage pays up to 25% of the amount paid for direct loss to the covered property, plus the deductible D. Preservation of property pays if the loss occurs within 30 days after the property was removed

A. the fire department service charge pays up to $500

Airborne volcanic blasts or shockwaves, ash, dust, particulate matter, and lava flow is best described as A. volcanic eruption B. lava action C. volcanic explosion D. volcanic action

A. volcanic eruption

Most losses are paid at _____ _____ _____. However, if the coinsurance conditions are met and costs are $______ or less, the policy will pay the cost of the building repair or replacement without taking depreciation into account.

Actual Cash Value $2,500

The insured's business sustains $25,000 damage in a fire. The fire department that was called to the scene billed the insured $1,000. The business is insured under the building and property coverage form for $500,000 with a $5,000 deductible. How much will the insurance company pay for the loss? A. $20,000 B. $21,000 C. $26,000 D. $27,500

B. $21,000

An insured with an extra expense coverage form will be paid how much of the lost business income if the restoration period was over 60 days? A. 80% B. 100% C. 60% D. 40%

B. 100%

In the commercial articles coverage form, additional acquired property is automatically covered if it is a type of property already covered by the form for up to A. 90 days B. 30 days C. 60 days D. 45 days

B. 30 days

All of the following statements about the earthquake cause of loss form are true EXCEPT A. all earthquake shocks or volcanic eruptions that occur within any 168-hour period constitute a single earthquake or volcanic eruption B. the expiration of the policy does reduce the 168-hour period to 24 hours C. volcanic eruption means the eruption, explosion, or pouring forth of a volcano D. this endorsement must be used in conjunction with the one of the cause of loss forms

B. B. the expiration of the policy does reduce the 168-hour period to 24 hours

The insured buys as office building next door to her insured business. Is the new building covered under her existing building and personal property coverage form? A. Yes, up to $100,000 coverage is available B. Yes, up to $250,000 coverage is available C. Yes, up to $500,000 coverage is available D. No, the insured must purchase a separate policy for the new building

B. Yes, up to $250,000 coverage is available

An inland marine coverage that insures against loss to machinery, equipment, building materials, and supplies in transit to or being used with or during the course of installation, testing, building, renovating, or repair is also known as A. bailee's customer policy B. an installation policy C. contract equipment floater D. electronic data processing equipment floater

B. an installation policy

____ is the delivery of property by the owner to someone else to be held for a special purpose, and then to be returned to the owner.

Bailment

The loss payment conditions states that the insurance company will give the insured notice of how it intends to value the loss within how many days after it receives the insured's sworn statement of loss? A. 10 B. 90 C. 30 D. 45

C. 30

If the insurance company requests a proof of loss on a commercial inland marine claim, the insured must submit it within A. 30 days B. 10 days C. 60 days D. 90 days

C. 60 days

Which of the following properties is excluded from coverage in the building and personal property coverage form? A. Outdoor fixtures B. Completed additions C. Underground pipes D. Outdoor furniture

C. Underground Pipes

Which of the following commercial property cause of loss form does NOT cover collapse? A. special B. broad C. basic D. limited

C. basic

Domestic shipments inland marine transportation forms cover shipments traveling by all of the following EXCEPT A. air B. train C. car D. mail

C. car

All of the following are one of the 11 covered perils on the basic form EXCEPT A. vandalism B. volcanic action C. mechanical breakdown D. smok

C. mechanical breakdown

Which of the following is NOT an example of a category of risk in commercial inland marine insurance? A. instrumentalities B. commercial floater risks C. personal inland marine insurance D. domestic shipments

C. personal inland marine insurance

The condominium association coverage form insures a condominium assoctiation against a direct physical loss of damage to all of the following EXCEPT A. business personal property B. personal property owned, used, or controlled by a unit owner C. personal property of others in the care, custody, or control of the association while it is at the premises D. buildings

C. personal property of others in the care, custody, or control of the association while it is at the premises

The bailee policy pays A. the insurer B. the business C. the customer D. the insured

C. the customer

Which type of coverage provides insurance for professional photographers and musicians?

Commercial Articles Coverage Form

What is the inland marine transportation form that protects all of the insured's incoming or outgoing shipments during the year against loss while in transit? A. motor truck cargo policy B. trip transit policy C. motor truck cargo-shipper's policy D. annual transit policy

D annual transit policy

A loss is covered under a commercial inland marine form and another policy. Both policies are written on the same basis. The commercial inland marine form will A. pay on an excess basis B. not pay anything on the loss C. pay 50% of a pro rata basis and 50% of an excess basis D. pay on a pro rata basis

D pay on a pro rata basis

Business personal property is covered while it is in the actual building, outside the building or in a vehicle within how many feet of the premises? A. 180 B. 30 C. 60 D. 100

D. 100

Under the earthquake and volcanic eruption endorsement, all earthquake shocks or volcanic eruptions that occur within a certain number of hours constitute a single earthquake or volcanic eruption. What is that period? A. 24 hours B. 40 hours C. 72 hours D. 168 hours

D. 168 hours

Insureds who depend on a particular business as the primary buyer for their products are covered under what form if the direct physical loss causes their earnings to suffer? A. Manufacturing location B. Leader location C. Contributing location D. Recipient location

D. Recipient location

Which cause of loss form provides open peril coverage? A. limted B. basic C. broad D. Special

D. Special

Loss caused by sprinkler leakage is covered under which commercial property causes of loss form? A. broad B. special C. basic D. all of these

D. all of these

Which of the following properties would NOT be excluded under the building and personal property coverage form? A. cost of excavation B. driveway C. lawn D. animals held for sale

D. animals held for sale

Which of the following commercial inland marine coverage forms CANNOT be included in the commercial package policy? A. film B. physician's and surgeons equipment C. accounts receivable D. bailee's customer

D. bailee's customer

Which inland marine transportation form protects the truck carrier for liability arising out of the transportation of cargo? A. annual transit policy B. trip transit policy C. motor truck cargo-shipper's policy D. motor truck cargo policy

D. motor truck cargo policy

What are the 6 categories of eligible marine risks?

Imports Exports Personal Floaters Domestic shipments Instrumentalities of transportation or communication Commercial property floater risks

The ____ ____ condition states that when there is other insurance written on the same basis, the policy pro rates with other policies.

Other Insurance

The ____ condition describes how losses will be settled.

Valuation

What does electronic data include?

information facts computer programs

The _____ conditions states that any revision that broadens coverage without requiring additional premium will automatically apply to the coverage part if the revision is adopted by the insurer during the policy period or within ____ days of the policy effective date.

liberalization 45

The ______ condition states that if a building has been vacant for more than ___ days before the loss, the insurer will not pay for a loss due to vandalism, water damage, theft or attempted theft, building glass breakage, or sprinkler leakage.

vacancy 60