AD Banker Chapter 4 (Dwelling Policy Exam)

Of the Dwelling Policy forms, which one would cover an owned mobile home permanently affixed to a foundation? A DP-1 B DP-1, 2, or 3 C DP-2 D DP-3

A A mobile home is only eligible for coverage under the DP-1.

Coverage D of the Dwelling Policy provides coverage for: A Fair Rental Value B Trees, Shrubs, and Other Plants C Additional Living Expenses D Other Structures

A Loss of Rental Income is an indirect loss sustained by the insured when the dwelling is rendered uninhabitable by a direct loss. Coverage D provides protection for this indirect loss.

Which form would not insure against external explosion? A Unendorsed DP-1 B DP-2 C Endorsed DP-1 D DP-3

A The basic perils covered by the DP-1 form (without the extended coverage perils endorsement) are: fire, lightning, and internal explosion.

Under which form is the Coverage B limit included in the overall policy limit represented by Coverage A? A DP-1 B DP-2 C DP-3 D DP-4

A Under the DP-2 and DP-3, the Coverage B amount is paid in addition to the limits represented by Coverage A. Under the DP-1 form, the Coverage B amount is included in the limit represented by Coverage A. There is no DP-4 policy.

Which of the following is false regarding the Broad Theft Endorsement under the Dwelling policy? A It includes vandalism resulting from theft B Only on-premises coverage is available C It applies only to owner-occupied structures D It may be added to any of the Dwelling forms

B The Broad Form Theft endorsement is attached to owner-occupied Dwelling policies to provide theft coverage for the owner-occupant's Personal Property. On-premises and off-premises coverage is available.

Under which of the following circumstances would the Limited Theft Coverage endorsement be used? A Coverage is desired for off-premises property B The insured dwelling is tenant-occupied C The insured dwelling is owner-occupied D Coverage against vandalism is needed for a dwelling vacant more than 60 days

B The Limited Theft Coverage endorsement must be used if the dwelling is tenant occupied. No VMM coverage applies if the dwelling was vacant for more than 60 consecutive days immediately before the loss. There is no off-premises coverage under this endorsement.

Which of the following statements about Fire Department Service Charge coverage is not correct? A The policy deductible does not apply to this coverage B Fire Department Service Charge coverage is included under all Dwelling policy forms C The policy will pay up to $1,000 for Fire Department Service Charge coverage D Coverage does not apply if the property is located within the limits of the jurisdiction furnishing the fire department response

C A typical dwelling policy will pay up to $500 for liability assumed for fire department charges when the fire department is called to save or protect covered property from an insured peril. Coverage does not apply if the property is located within the limits of the jurisdiction furnishing the fire department response.

Which of the following is true regarding coverage of trees, shrubs or plants under the Dwelling policies? A Theft of shrubs and plants is covered B All vehicle damage to trees, shrubs, or plants is covered C Damage to plants by wind, hail, weight of ice, snow or sleet is not covered D The Limit of Liability is $1,000 for any tree, shrub, or plant

C Damage to outdoor plants by forces of nature other than lightning are so common that such damage is considered uninsurable. Coverage for certain other perils is provided, with a limit of $500 for any one tree, shrub, or plant. Only damage from vehicles unowned by the insured is covered.

All of the following are true regarding Dwelling policy eligibility, except: A Mobile homes are eligible if written on a DP-1 B Some incidental business occupancies are permitted C The dwelling must be used for seasonal or secondary purposes D Farm dwellings are not eligible

C The dwelling must be used principally for residential dwelling purposes and MAY be occupied on a seasonal or secondary basis, but it is not required.

Under the property removed coverage extension of a Dwelling Policy, which of the following is incorrect? A The property is covered against direct loss from any peril B The extension does not change the Limit of Liability that applies to the property C The policy will not provide any coverage while insured property is being removed from endangered property D Coverage applies up to 5 days under the DP-1, and up to 30 days in the DP-2 and DP-3 forms

C The function of the Property Removed extension is to reimburse the insured for any damage to the property occasioned by its removal from premises endangered by an insured peril.

Which of the following properties is ineligible to be insured under a Dwelling Policy? A Dwellings containing three apartment units B Mobile homes C Dwellings with any type of business in them D Farms

D Dwellings located on farms are not eligible. Dwellings must be used principally for residential dwelling purposes and cannot have more than 4 dwelling units. Incidental business occupancies, such as schools, studios, and offices, are permitted if the primary use of the dwelling is as a personal residence.

Which of the following is true under the Dwelling policy? A The Broad Form automatically covers contents against theft B The Basic Form covers loss to trees, shrubs and plants C The Special Form covers contents on an open perils basis D The Basic Form covers the perils of fire, lightning and internal explosion

D The Basic Form is written on a named perils basis and does not cover theft, or loss to trees, shrubs, and plants.

Which of the following is true regarding the Personal Liability Supplement? A It covers Professional Services rendered by the insured B It covers the insured's personal autos C The Limit of Liability is the same as the Coverage A amount D It provides coverage for claim expenses, first aid expenses and damage to property of others

D The Claim Expenses, First Aid Expenses, and Damage to Property of Others are Additional Coverages that supplement Coverage L, Personal Liability, and Coverage M, Medical Payments.

Under the Basic Dwelling Form, when is damage caused by vandalism included as covered peril? A When the Extended Coverage perils are added to the DP-1 B When under the unendorsed DP-1 C This coverage is not available in the Basic Dwelling Policy D When the V&MM endorsement is added to the DP-1

D The DP-1 provides coverage against three perils: fire, lightning, and internal explosion. The Vandalism and Malicious Mischief endorsement adds coverage for damage caused by vandalism.

Where in the Dwelling policy is it stated that earth movement, landslide, mine subsidence, and mudflow are not covered unless resulting from direct loss by fire or explosion? A Insuring Agreement B Other Coverages C Endorsements D General Exclusions

D The perils of earth movement, landslide, mine substance, and mudflow are perils that, because of their catastrophic nature, are not insured under the Dwelling policy.