Unit 7 Checkpoint Exam

ABC Insurance company is cancelling a policy that has been in effect for 90 days due to a nonpayment of premium. How many days' notice does ABC insurance company have to give the insured? -30 days -10 days -60 days -20 days

10 days

The insurance limit for Coverage B - other structures is -30% of Coverage A -50% of Coverage A -10% of Coverage A -10% of Coverage B

10% of Coverage A

Which of the following individuals would NOT be insured in a homeowners policy? -Samantha, age 18, lives with a family and is an exchange student from Spain -Michael, age 23, lives with his parents while attending college at a local university -Allison's best friend Tiffany, age 29, is living with her family for the summer -Samuel, age 75, is ill and living with his daughter while he looks for a retirement home

Allison's best friend Tiffany, age 29, is living with her family for the summer

Which of the following additional coverages is only included in certain homeowners forms? -Property removed -collapse -fire department surcharge -trees, shrubs, and other types of plants

Collapse

Which of the following coverage applies to the personal property owned or used by an insured and is included in all homeowners policies -Coverage C -Coverage A -Coverage D -Coverage B

Coverage C

Which of the following pays all necessary medical expenses to others incurred within 3 years of an accident that causes bodily injury? -Coverage F -Coverage E -Coverage A -Coverage B

Coverage F

The insured is renting a residential condominium. If the condominium owner requires all her tenants to buy insurance, which homeowners policy would the insured purchase?

Ho-4 (renters)

Which of the following is NOT a common exclusion that applies to Coverage E & F in a homeowners policy? -Liability sustained while on an insured's premise with permission -Liability arising out of physical or mental abuse -Liability for injury or damage that is intended by the insured -Personal injury losses

Liability arising out of physical or mental abuse

What are the main advantages to the insured if the homeowners policy is a package policy? -the insured is less likely to have gaps in coverage by having property and liability insurance in one policy -The insured pays commission for one policy instead of several -The cost of the policy is more affordable -There is less paperwork than having several monoline policies

Liability sustained while on an insured's premise with permission

Josephine has a $100,000 loss to her dwelling. She has insurance greater than 80% of the replacement cost and also agrees to replace the damaged property. Which of the following explains how the insurer will pay the HO-2 claim? -The insurer will pay replacement cost minus depreciation -The insurer will pay actual cash value -The insurer will pay replacement cost -The insurer will pay market value

The insurer will pay replacement cost

Nick and Melissa bought a homeowners policy and due to their special needs they attached an endorsement to the policy. The endorsement will override any exclusions that apply to Nick's business activities conducted at their home. Which of the following endorsements did they purchase? -The home day care endorsement -the personal property replacement cost endorsement -the permitted incidental occupancies endorsement -the scheduled personal property endorsement

The permitted incidental occupancies endorsement

Which of the following losses would be 100% covered under Coverage C - personal property? -a $1,250 fur coat that was stolen from the premises -a $3,000 firearm that was stolen from the premises -a $5,000 diamond that was stolen from the premises -a $500 coin collection that was stolen from the premises

a $1,250 fur coat that was stolen from the premises

All of the following statements regarding additional coverages in all homeowners forms are correct EXCEPT: -additional coverages are included if the insured pays an additional premium -reasonable repairs additional coverage is included in all homeowners forms -debris removal additional coverage is included in all homeowners forms -additional coverages are included with no additional premium

additional coverages are included if the insured pays an additional premium

Which of the following Section II liability endorsements provides coverage for business conducted away from the residence premises? - permitted employer endorsement - business pursuits endorsement - permitted business endorsement - permitted incidental occupancies endorsement

business pursuits endorsement

When an insured adds a scheduled personal property endorsement to a homeowners policy -losses for scheduled items are paid on a replacement cost basis -separate deductibles apply to the endorsement, and are chosen by the insured prior to the effective date of coverage -coverage is provided on an open peril basis -minimum limits are established for each of the nine major categories

coverage is provided on an open peril basis

All of the following are eligible for coverage under a homeowners policy EXCEPT: -a mobile home with a mobile home endorsement -a home with three families -farm dwellings -tenants of a rental property

farm dwellings

Which of the following is NOT covered if the insured has broad peril coverage? -Falling objects -Weight of ice, sleet, or snow -Flood damage -Explosion

flood damage

Which of the following is NOT covered if the insured has basic peril coverage? -Freezing of plumbing and related systems -smoke -vandalism -fire

freezing of plumbing and related systems

Supplementary payments of the homeowners policy Section II are paid -up to the limit of liability -in addition to the actual cash value -in addition to the replacement cost -in addition to the limit of liability

in addition to the limit of liability

All of the homeowners forms provide identical -property coverage -liability coverage -exclusions -peril coverage

liability coverage

The standard mortgage clause specifies the rights and duties of the mortgagee which include -determining if the property meets the mortgagee's insurance eligibility requirements -paying the premium if the insured fails to do so -requesting cancellation of insurance if the insured fails to make mortgage payments -filing proof of loss for scheduled personal property

paying the premium if the insured fails to do so

Which of the following is the correct formula used to calculate actual cash value?

replacement cost minus depreciation cost

All of the following statements about Coverage A in a homeowners policy under Section I are true EXCEPT -property attached to the dwelling is included -tenants are covered -the HO-6 provides coverage for inside walls and floors -materials on the premise used for construction are covered

tenants are covered

Under the cancellation condition, the insurer can cancel for any reason with 10 days' written notice to the insured during -the first 180 days of a policy term -the first 365 days of a policy term -the first 60 days of a policy term -the first 90 days of a policy term

the first 60 days of a policy term

All of the following statements about Coverage E - personal liability are true EXCEPT -coverage applies for bodily injury or property damage for personal activities that occur anywhere -the insurer will provide a defense for the insured only when the insured is considered at fault -coverage applies for locations that the insured is temporarily residing -the base liability limit provider for any one occurrence is $100,000 but can be increased for an additional premium

the insurer will provide a defense for the insured only when the insured is considered at fault