Questions & Answers: Dwelling
How much is a detached garage insured for if the garage is rented to tenants and the dwelling is insured under a DP-3 for $200,000 under Coverage A?
$20,000 Rationale: The Coverage B limit of insurance is 10% of the Coverage A limit.
An insured tenant may use up to what percentage of Coverage C to improve the premise?
10% Rationale: This additional coverage in the DP-2 and DP-3 (included in the DP-1) can also be used for alterations and additions at the insured's expense for the named insured's premises.
An insured tenant may use up to ______________ of Coverage C to cover improvements made to the insured premises.
10% Rationale: This additional coverage in the Dp-2 and Dp-3 (included in the Dp-1) is used for alterations and additions at the insured's expense for the named insured's premises.
All of the following may be eligible for coverage under the Dwelling Program, except:
A farmhouse Rationale: A farmhouse does not fit the eligibility requirements of the Dwelling Program.
Which of the following coverages is not included in the Basic Dwelling Form?
Additional Living Expenses Rationale: The Basic Dwelling Form (DP-1) provides coverage for Fair Rental Value.
All of the following are true of Dwelling Forms, except:
Antennas and awnings are covered for wind losses Rationale: Wind losses on antennas and awnings are excluded from coverage in a dwelling policy.
Which is true regarding dwelling policies?
At the insured's option, property of guests and servants is covered under Coverage C Rationale: Coverage C may be extended to cover property of guests and servants.
Choose the true statement regarding dwelling policies.
At the insured's option, property of guests and servants is covered under Coverage C Rationale: Coverage C ay be extended to cover property of guests and servants.
Choose the false statement about Dwelling Policy Form Coverage E.
Available in all Dwelling policy forms Rationale: Coverage E- Additional Living Expense is not included on the DP-1 form.
Which of the following is not true about Coverage E?
Available in all Dwelling policy forms Rationale: Coverage E- Additional Living Expense is not included on the DP-1 form.
Which DP form does not cover burglar damage?
Basic Form (DP-1) Rationale: Damage by burglars is covered only in the broader Forms DP-2 and DP-3.
Coverage D does not cover which of the following?
Cancellation of a lease Rationale: Cancellation of lease is not covered since this coverage provides fair rental value of the lost.
Collapse is defined as which of the following?
Caving in Rationale: Collapse also does not include shrinking, bulging, or expansion.
Which of the following defines "Collapse"?
Caving in Rationale: Collapse also does not include shrinking, bulging, or expansion.
Which is true of the Special Dwelling Forms?
Content are covered on an actual value basis Rationale: Cracking of walls and theft are exclusions to this policy. Furthermore, losses to the dwelling are paid on a replacement cost basis, while the contents are paid on an actual cash value basis.
Which coverage applies to the building described in the Dwelling Form policies, including materials on intended for repair or alterations?
Coverage A Rationale: Coverage A applies to the Dwelling at the described location; Coverage B, to Other Structures; Coverage C, to Personal Property; Coverage D, to Fair Value, and Coverage E to Additional Living Expenses.
Damaged household and personal property, both on premises and in transit between the insured's old and new residences, are covered by the Dwelling Policy under _____________.
Coverage C Rationale: Coverage C is the coverage for Personal Property. 10% of the Coverage C limits apply to the Insured's Personal Property away from the premises anywhere in the world.
Choose the correct answer regarding coverage of trees, shrubs or plants under the Dwelling policies.
Damage by wind, hail, weight of ice, snow or sleet is not covered Rationale: 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.
Choose the correct answer regarding coverage of trees, shrubs, or plants under the Dwelling policies.
Damage by wind, hail, weight of ice, snow or sleet is not covered Rationale: 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.
Water damage caused by which of the following is a covered loss?
Discharge caused by a plumbing failure Rationale: Water damage is also excluded if caused by surface water, tidal water, and leakage through a building, foundation, or other structure.
Water damage caused y which of the following is a covered loss?
Discharge caused by a plumbing failure Rationale: Water damage is also excluded if caused by surface water, tidal water, and leakage through a building, foundation, or other structure.
Choose the property that is not eligible to be insured under a Dwelling Policy.
Farms Rationale: The farm property exposure includes hazards not found in other residential property. Insurance companies have developed special Farm Forms for farm property insurance.
Earth movement includes landslide, mine substance, or mudflow and all are not covered is stated where in the Dwelling Policy?
General Exclusions Rationale: The perils of earth movement, landslide, mine substance, and mudflow are perils that, because of their geographic nature, are insured under Earthquake or Flood insurance policies designed specifically for these perils.
Which statement is true of a Dwelling Policy Special Form?
If an insured dies, coverage continues for the insured's legal representatives Rationale: The insured's legal representative is automatically covered in the event of the insured's death.
Which of the following coverages is not provided by the Personal Liability endorsement?
Injury a caused to a regular resident of the dwelling Rationale: Coverage does apply to expenses incurred by residence employees but not the named insured or regular residents of the named insured's household.
All of the following are true of the Dwelling Broad Form Policy, except:
It includes dwellings located on farms Rationale: Dwellings located on farms are not eligible for the Dwelling program.
Which of the following is false regarding the Dwelling Broad Form Policy?
It includes dwellings located on farms Rationale: Dwellings located on farms are not eligible for the Dwelling program.
Choose the correct statement regarding the Personal Liability Supplement.
It provides coverage for claim expenses Rationale: Besides 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 Payment.
The DP-3 provides what percentage of coverage for damage to the insured's dwelling when a storm caused a black-out at the utility works building for 24 hours?
No coverage Rationale: Damage from power failure that takes place away from the insured premises is excluded under the dwelling forms.
Choose the incorrect answer regarding the Broad Theft Coverage Endorsement on a Dwelling policy.
Only on-premises coverage is available Rationale: The Broad Form Theft endorsement is attached to owner-occupant's Personal Property. On- premises and off-premises coverage is available.
An insured tenant may use up to what percentage of Coverage C to improve the premises?
Rationale: 10% Rationale: This additional coverage in the DP-2 and DP-3 ( included in the DP-1) can also be used for alterations and additions at the insured's expense for the named insured's premises.
Which of the following would a claims adjuster use to settle a fire damage claim to a dwelling insured under a DP-3 policy?
Replacement cost up to Coverage A Rationale: Losses to the dwelling and other structures are paid on a replacement cost basis, and losses to personal property are paid on an actual cash value basis.
Choose the peril that is not covered under the Dwelling Broad Form.
Smoke damage from industrial operations Rationale: Smoke damage is a cover peril of the Dwelling Broad Form; however, the description of the peril specifically excludes smoke from agricultural smudging or industrial operations.
Which of the following statements is true regarding the Dwelling Form?
The Basic Form covers the peril of fire Rationale: The Basic Form without endorsement covers only three perils. All other answers are false.
All of the following are false of the Dwelling Forms, except:
The Basic Form covers the perils of fire, lightning and internal explosion Rationale: The Basic Form is written on a named peril basis and does not cover theft, or loss to trees, shrubs, and plants.
Select the true statement concerning the Dwelling Special Form.
The Dwelling and other structures are provided Open Perils coverage on a Replacement Cost basis Rationale: In the Dwelling Special Form, the dwelling and other structures are provided Open Perils coverage on a replacement cost basis, but the Personal Property coverage remains as Broad Perils coverage on an Actual Cash Value basis.
Which statement is true concerning dwelling policies?
The Special Form covers the dwelling for the open perils and the contents for the broad form perils Rationale: The Special Form covers the dwelling for open perils, and the contents for broad form perils.
All of the following are true of Dwelling Special Forms, except:
The dwelling and contents are both covered on an open peril basis Rationale: Only the dwelling is covered on an open peril basis.
Choose the false statement among the following statements about the DP-3 Policy.
The dwelling and contents are both covered on an open peril basis Rationale: Only the dwelling is covered on an open peril basis.
The Limited Theft Coverage endorsement is used under which of the following circumstance?
The insured dwelling is tenant occupied Rationale: The Limited Theft Coverage endorsement must be used if the dwelling is tenant occupied.
The Limited theft Coverage endorsements is used under which of the following circumstances?
The insured dwelling is tenant occupied Rationale: The Limited Theft Coverage endorsement must be used if the dwelling is tenant occupied.
Under Coverage C of the Special Dwelling Form, all of the following are included, except:
The insured's golden retriever Rationale: The policy does not cover animals or pets.
Which of the following property is not covered under Coverage A of a Dwelling Policy?
The land on which the dwelling is located Rationale: Coverage A stipulates, " We do not cover land, including land on which the dwelling is located."
Which of the following statements about the Fire Department Service Charge is not correct?
The policy will pay up to $1,000 Rationale: Under each of the dwelling forms, the policy will pay up to $500 for liability assumed for fire department charges when the fire department is called to save or project covered property from an insured peril.
The Dwelling Broad Form (DP-2) includes coverage for all of the following, except:
Theft Rationale: There is no theft coverage in a dwelling policy.
An insured tenant may use up to _________________ of Coverage C to cover improvements made to the insured premises.
This additional coverage in the DP-2 and DP-3 (included in the DP-1) is used for alterations and additions at the insured's expense for the named insured's premises.
All of the following are true of dwelling policies, except:
Trees, shrubs and plants are covered for up to $1,000 total Rationale: The limit for trees, shrubs and plants is $500 for any 1 item or 5% of Coverage A.
Choose the claim that is covered under the DP-3.
VMM to a dwelling vacant for 30 days before the loss Rationale: Vandalism and malicious mischief and any ensuing loss is excluded if the dwelling has been vacant for more than 60 consecutive days immediately before a loss.
Choose the claim that is covered under under the DP-3.
VMM to a dwelling vacant for 30 days before the loss Rationale: Vandalism and malicious mischief and any ensuing loss is excluded if the dwelling has been vacant for more than 60 consecutive days immediately before a loss.
All of the following are covered perils under the Extended Coverage Endorsement to the DP-1, except:
Weight of ice, snow or sleet Rationale: Weight of ice, snow or sleet is not part of the Extended Coverage perils.
