Property Ins. Mod B

Hamish has covered his antique automobile with a loss settlement amount that is stated in the policy of $55,000. The ACV of the vehicle is $32,000, but Hamish insured it for more because of his emotional attachment to the car. The policy deductible is $1,000. Hamish is driving his beloved automobile to an antiques car show one afternoon, when he is distracted by another antique vehicle and crashes into a brick retaining wall. Hamish's antique car is a total loss. Which of the following is the amount he should receive for his claim? A. $31,000. B. $23,000 C. $55,000. D. $32,000.

A. $31,000. With a loss settlement that is a "stated amount" the insured will collect the value stated in the policy or the ACV, whichever is less, minus the deductible. Therefore, the correct answer would be $31,000.

Monique's house is covered in brick veneer. Monique's house is which of the following types of construction? A. Frame. B. Joisted masonry. C. Non-Combustible. D. Masonry Non-Combustible.

A. Frame. Brick or any other type of veneer is placed over "frame" construction.

Aiden is reimbursed by his insurance company for the cost of a new sofa, after a 10-year-old sofa is destroyed by fire. Which of the following best describes the loss settlement method used in this situation? A. Replacement cost value. B. Agreed value. C. Actual cash value. D. Stated value.

A. Replacement cost value.

The purpose of the appraisal clause in a property insurance policy is to: A. Settle disputes concerning the amount of a loss. B. Determine who is liable for damages. C. Deny coverage. D. Obtain facts prior to filing a lawsuit.

A. Settle disputes concerning the amount of a loss. The appraisal clause is used when the insured and the insurer cannot agree on the value of the loss. Either party can demand an appraisal of the loss.

When the loss settlement condition under a property insurance policy indicates that the claim will be settled at the "agreed value", which of the following is TRUE? A. The insurer will pay the value that was agreed upon and scheduled in the policy. B. The insurer will pay the different between the replacement cost value of the property and the ACV. C. The insurer will pay either the value agreed upon in the policy or the ACV, whichever is less. D. The insurer will pay the value agreed upon by the two appraisers selected by the insured and the insurer.

A. The insurer will pay the value that was agreed upon and scheduled in the policy.

Following the payment of a claim, the salvaged property becomes the property of: A. The insurer. B. The insured. C. A third party salvage company contracted by the insurer. D. The state.

A. The insurer.

Dana lives in a state that has passed a Valued Policy Law (VPL). This means that insurers issuing property policies in the state: A. Must pay the full replacement cost value of the property, scheduled on the Declarations page, in the event of a partial loss. B. Must pay the full limit of the policy, stated on the Declarations page, in the event of a total loss. C. Must indicate on the Declarations page, a specific amount of coverage that the insured must carry to meet the coinsurance requirement. D. Must pay the actual cash value (ACV) of the property in the event of a total loss.

B. Must pay the full limit of the policy, stated on the Declarations page, in the event of a total loss.

Which of the following statements defines a "bailee"? A. A property owner who willingly entrusts the property to another person. B. Someone, other than the insured, to whom the insured temporarily entrusts their property. C. A property owner who is in the business of renting property to others. D. Someone to whom property is sold on an installment basis.

B. Someone, other than the insured, to whom the insured temporarily entrusts their property

A dwelling or building constructed of modified fire resistive materials has a fire resistance rating of: A. At least 3 hours. B. At least 1/2 hour. C. At least 1 hour. D. At least 2 hours.

C. At least 1 hour.

A method of replacing damaged property with something not exactly like the damaged item, but will perform in a similar fashion is known as: A. Agreed replacement value. B. Stated amount value. C. Functional replacement cost. D. Replacement cost.

C. Functional replacement cost.