Unit 19: Business Owners Policy - Quiz Material

In addition to maximum floor space of 25,000 the business owners eligibility rules limit eligible risk to a maximum of...

$ 3 million in annual sales

Medical expense will pay reasonable expense for first aid, medical services, and funeral services within...

1 year of the date of the accident

Personal property is covered when it is within how many feet of the premises?

100

The largest office building risk that may be eligible for a business owners policy is...

6 stories or less and 100,000 square feet

Which of the following losses would not be covered under the property coverage of the businessowners policy? A. An insured moved inventory to another location after a tornado. Two days later, a fire in the new location damaged that property. B. A steam engine explosion at the insured's business spewed toxic chemicals onto property belonging to another company. That company's owner sued the insured for the cost to clean up the chemicals. C. When a tornado damaged a nearby business, authorities closed off the area for one week to clean up the damage. The insured lost business income during that period.

A steam engine explosion at the insured's business spewed toxic chemicals onto property belonging to another company. That company's owner sued the insured for the cost to clean up the chemicals.

Which of the following losses would be excluded under the property coverage of the BOP? A. Termites damaged an insured's building B. Pianos in an insured's warehouse were damaged by dryness during an extremely cold winter. C. An error in the design specifications for an insured's building resulted in the building's collapse 6 months after construction was completed. D. All of these are excluded.

All of these are excluded

Mechanical breakdown coverage is...

An optional extension of the BOP

All of the following are common exclusions in the businessowners policy except... A. Earth Movement B. Water, including flood and sewer backup C. Damage caused by insects, rodents, or birds. D. Collapse

Collapse

Which of the following is an ineligible risk in the businessowners policy A. More than 100 employees B. Less than 100 employees C. Revenues of $3 million or less D. Business occupying up to 25,000 square feet

More than 100 employees

Which of the following would not be covered under the building coverage of the business owners policy? A. Additions Under Construction B. Completed Additions C. Materials or equipment within 100 feet of the premises D. Outdoor Fences

Outdoor Fences

Which one of the following coverages is not included in the businessowners policy? A. Bodily Injury Liability B. Property Damage Liability C. Medical Expense D. Professional Liability

Professional Liability

Which of the following statements regarding the employee dishonesty optional coverage is not correct? A. The insurance company will not pay for a covered loss that is discovered after 3 years from the expiration of the policy. B. Only a loss that occurs during the policy period is covered. C. Coverage of an employee is canceled immediately upon discovery the employee committed a dishonest act. D. The insurance company will not pay for a covered loss that is discovered after 1 year from the expiration of the policy.

The insurance company will not pay for a covered loss that is discovered after 3 years from the expiration of the policy.

Which of the following is not one of the five different classes of business personal property covered? A. A tenant's improvements and betterments B. The property of others in the insured's care C. The land that the property is on D. The exterior building glass

The land that the property is on

On the businessowners policy declarations page, the named insured is listed as a limited liability company. In this example, all of the following individuals would be insured except... A. The named insured B. The named insured's partner or spouse C. The members of the organization D. The managers of the organization

The named insured's partner or spouse

There are two sets of conditions that apply to every policy for property coverage. These conditions are known as the property general conditions and...

The property loss conditions

An insured is required to have a sprinkler system and a burglar alarm installed on the premises in order to meet certain conditions of a policy endorsement. Which endorsement does the insured likely have? A. The protective safeguards endorsement. B. The utility service - time element coverage endorsement C. The utility service - direct damage coverage endorsement D. The common policy conditions endorsement

The protective safeguards endorsement

Which of the following endorsements covers loss or damage to a property caused by an interruption in water, communication, or power supply service? A. The utility services - direct damage coverage endorsement B. The Utility services - time element coverage endorsement C. The protective safeguards endorsement D. The hired auto and nonowned auto liability.

The utility services - direct damage coverage endorsement

The standard deductible for the businessowners policy is...

$500

If an insured has the preservation of property additional coverage included in their BOP, how many days does coverage apply while the property is being stored in another location?

30 days from the day the property was first moved

The conditions that apply to an entire businessowners policy are called...

Common Policy Conditions

Which of the following is not excluded under businessowners liability coverage? A. Pollution losses caused by the insured. B. Liability assumed under an insured contract. C. The cost of recalling the insured's product because of a suspected safety hazard. D. Damage to the insured's own work.

Liability assumed under an insured contract

Which of the following is not a common exclusion under business liability coverage? A. Liability related to or or written publication that slanders a person or organization B. Liability related to liquor that was distributed by the insured. C. Liability arising from rendering professional services D. Liability for damage to property the insured owns, rents, or occupies

Liability related to oral or written publication that slanders a person or organization

Which of the following losses would not be excluded under the businessowners policy? A. Loss caused when underground water seeps through the foundation of an insured's building B. Additional expense incurred when the insured's damaged building is required by a city ordinance to be completely torn down and rebuilt rather than repaired. C. Loss caused by a power faulure that occurs on the insured's premises D. Loss caused when an insured's equipment breaks down and prevents the insured from earning income.

Loss caused by a power failure that occurs on the insured's premises

Which of the following statements about a supplementary payment is not correct? A. Supplementary payments do not reduce the policy limit. B. Supplementary payments cover up to $250 for the cost of bail bonds. C. Supplementary payments do not cover expenses that the insurance company incurs. D. Supplementary payments cover costs the insured is required to pay because of a lawsuit.

Supplementary payments do not cover exppenses that the insurance company incurs.