220 - section 4 test questions - Homeowners, Dwelling and Related Coverages
Describe the coverage D subsection of coverages in a homeowner's insurance policy.
"Loss of Use" covers increases over normal living costs if damage from a covered peril make the residence unfit for occupancy.
Describe the Coverage B subsection of coverages in a homeowner's insurance policy.
"Other structures" covers private structures on the residence premises that are not attached to the main dwelling, such as a detached garage, guest house, fence, tennis court or storage building.
Describe the coverage C subsection of coverages in a homeowner's insurance policy.
"Personal property" covers personal property, wherever it is located, that is owned or used by the named insured, the named insured's relatives, and any other person under 21 who resides in the named insured's household.
Which one of the special coverage internal limits is incorrect?
$1,000 for jewelry by theft
An insured has an HO-3, no endorsements, with following limits: A - $70,000, B - $7,000, C - $35,000, D - $14,000. The policy has a $250 deductible ($500 deductible for windstorm/hurricane). What is the amount payable (if any) when: "In a fire the insured's fur coat valued at $2,000 was destroyed"?
$1,750 is payable
Which of the 'additional coverages' internal limit is incorrect under the homeowner's program?
$2,000 for landlord furnishings
If an insured had a personal articles floater, including basic coverage with no options for all available classes of property, how much (if any) would be payable in the following described loss: "For silverware, the insured had a sterling silver service scheduled for $2,000 coverage. The insured purchased some silver place settings at a cost of $700. Two weeks later, both the scheduled item and the new place settings were stolen?"
$2,000 payable; Silverware does not include automatic coverage for newly acquired property. BASIC MEANS ACV
An insured has an HO-3, no endorsements, with following limits: A - $70,000, B - $7,000, C - $35,000, D - $14,000. The policy has a $250 deductible ($500 deductible for windstorm/hurricane). What is the amount payable (if any) when: "A vacation residence in North Carolina owned by the insured burnt down. All the furniture, with an ACV of $5,000 was destroyed"?
$4,750, but for full replacement cost settlement, the insured needed not less than 80% of the full replacement value as the coverage A limit ($125,000 x 80) In the question Coverage C = $35,000 The property that was destroyed had an ACV of $5,000 The HO-3 will extend 10% of Coverage C to "property located at another residence" which is $3,500 The $3,500 is the max payout for personal property under the HO-3 for "property locate at another residence" The Deductible is $250 Damages = $5,000 Deductible = $ 250 Total Possible Payout to Insured = $4,750 Total Coverage Available = $3,500 The insured would receive a payout of $3,500; the Deductible is subtracted from the damages AND the eligible coverage is only $3,500 which is less that "total possible payout" (the damages less the deductible). The correct answer is: $3,500 is payable - $5,000 loss less $250 deductible, but the limit on property usually located at a secondary residence is limited to 10% of the Coverage C limit. - 250 deductible - 5k in damage minus deductible
Under a Personal Articles Floater, a pair of antique salt and pepper shakers is insured for $1,000. When one of the shakers is damaged by a covered peril, the remaining shaker is worth only $100. The insurer will pay:
$900
How is occupancy defined under the homeowner's program?
. For private residential purposes
Florida's homeowner's policy cancellation conditions include all the following except?
60 day notice for cancellation
The homeowner's program specifically states all of the following are eligible risks for the program except?
A 1-4 family dwelling where the owner is not an occupant
What is the standard deductible for hurricane in section I- property coverage of a homeowner's insurance policy?
A minimum of $500/maximum or 2%-5% of the policy limits applies. If loss is less than the deductible, no payment is due.
Dwelling Fire's Coverage B "Other Structures" provides coverage for which correct exposure?
A private garage rented to a neighbor for storage of his 1957 Chevy year around
Which statement does not fall within the flood definition?
A property in areas that are normally flooded on a continuous basis
A Blanket Personal Articles Floater policy covering stamps and coins for $100,000 is purchased. The insured sends stamps and two rare coins by First Class Mail, which are lost. The stamps and coins are valued $50,000. How much does the policy pay?
A. $50,000 B. $25,000 C. None Correct D. $1,000 none
Which type of risks would qualify for the dwelling program?
A. A condominium rented to others B. An owner occupied condominium C. All of the answers are correct Correct D. A single family dwelling all would apply
Which statement about DP1 Basic Form is not true?
A. All of the answers are true Correct B. Coverage C provides up to 10% for tenants betterments and alterations C. Up to 10% of Coverage A is applied to "other structures" D. Cost of removal of debris after a covered loss is covered ALL ARE TRUE
Which of the following items are listed in the general exclusions for homeowner's property section I?
A. Backing up of sewers and drains B. All of the answers are correct Correct C. Flood from rising water D. Intentional acts of the insured - ALL ARE CORRECT
Under the Flood Program, an eligible building must meet which of the following criteria?
A. Be located within an eligible community B. Have walls and a roof C. All of the answers are correct Correct D. Be principally above ground by at least 50% ALL ARE CORRECT
Which of the following perils is excluded in all cause of loss forms?
A. Power failure from an off premises loss B. Artificially generated electrical current starts a fire C. All of the answers are excluded D. Flood Incorrect all of them
Identify which items are available options under the homeowner's policy.
A. Replacement cost settlement on contents B. Theft coverage for an occasionally rented residence property C. No deductible scheduled floater for golf equipment D. All of the answers are correct Correct all are correct
Under the homeowner's program which person does not qualify as an insured under the policy?
A. Residing relative staying for only two weeks B. Spouse C. All of these qualify Correct D. An 18 year old nephew under the dwelling owner's responsibility ALL ARE CORRECT
Homeowner's Coverage C "Personal Property" exclusions include which of these items?
A. Tape decks, CB radios and equipment exclusive to an automobile B. Personal property of a non- related border C. All of the answers are correct Correct D. Jewelry coverage on an inland marine jewelry floater ALL ARE CORRECT
Which of the following statements is true about the loss settlement clause of the homeowner's policy?
A. The insured must notify the insurer of the intent to replace the property to receive replacement cost coverage B. If the dwelling is insured for 80% then replacement cost may apply C. All of the answers are correct Correct D. Section I property is usually subject to a ACV settlement all are correct
What are the limits of liability in section II of a homeowner's policy?
Basic limits of liability are $100,000 per occurrence for Coverage E and $1,000 per person for Coverage F. These limits may be increased.
A Personal Articles Floater in the Inland Marine program excludes all the following except?
C. Mysterious Disappearance
Which of the following statements about homeowner's coverage A is false?
Coverage A may be endorsed to Form 4 Tenant's coverage for betterments and alterations coverage only
Describe the Coverage A subsection of coverages in a homeowner's insurance policy.
Dwelling covers the dwelling building and structures attached; also construction materials and supplies on or adjacent to the premises.
Which type of structures does not qualify for the flood program dwelling form?
Five Unit Apartment CAN ONLY BE 4
How is occupancy defined under the homeowner's program?
For private residential purposes
Coverage B 'Other Structures' under a homeowner's policy does not cover which of the following?
Guest house regularly rented to a friend for the summer
How is the rating for the premium accomplished for a homeowner's policy?
It is based on three elements 1. the fire protection available 2. the construction of the dwelling 3. the location in the state
Which of the following is not an available endorsement under the homeowner' policy?
Jewelry $6,000 aggregate/per item option
A Personal Articles Floater in the Inland Marine program excludes all the following except?
Mysterious Disappearance
Are there any acceptable conditions in which a named insured is an entity under a homeowner's insurance policy?
No the named insured may not be an entity such as a corporation, partnership or estate Correct
An insured has an HO-3, no endorsements, with following limits: A - $70,000, B - $7,000, C - $35,000, D - $14,000. The policy has a $250 deductible ($500 deductible for windstorm/hurricane). What is the amount payable (if any) when: "Due to a flood, the insured had to move out of the residence for two weeks, and incurred $600 in additional living expense"?
Nothing is payable - the peril is generally excluded. IF THEY ENDORSED FLOOD THEY WOULD GET PAID
Homeowner's Coverage C "Personal Property" covers each of the following examples except?
Property of a guest anywhere in the world guest key word`
Which one of the following limitations is covered under the homeowner's theft peril?
Student's contents away at school subject to a 45 day prior occupancy condition
The flood policy will only cover a dwelling for replacement cost if which of the following conditions exist?
The dwelling is lived in at least 80% of the time
Which dwelling fire underwriting guideline is true?
The insured may select any limit for the dwelling coverages
Under a personal articles floater a man and his wife had an individually scheduled ring covered for $75,000. They later purchased a ring for $150,000 and did not report the purchase to the insurer for two days. Before the purchase was reported, the $150,000 ring was stolen. How would the claim be settled?
The insurer would pay $10,000 (25% of the current coverage, maximum of $10,000)`
Define a named insured under a homeowner's insurance policy.
The person named in the policy
Under the dwelling fire program, extended coverage does not include which peril?
Theft
Section II personal liability of the homeowner's policy covers all of the following locations except?
Vacant land upon which the insured grows grain
Dwelling fire's Coverage C "Personal Property" excludes which items specifically?
Valuable papers
Which additional peril does the Broad Cause of Loss form not provide?
Water damage from discharge from an A/C handler outside the building
Will an insured be permitted to cover their home while it is under construction under the homeowner's program?
Yes they may BUILDERS RISK
Which of the following is not a named insured under a homeowner's policy?
corporation
Which of the following perils cannot be covered under the Basic Cause of Loss form (DP1)?
falling objects
If an insured had a personal articles floater, including basic coverage with no options for all available classes of property, how much (if any) would be payable in the following described loss: "A ring, scheduled for $1,500, was stolen from the glove compartment of the insured's unlocked car. The ring could be replaced for $1,200."
$1,200 payable - Loss in not excluded and coverage is for the lesser of ACV or cost to repair or replace.
If an insured had a personal articles floater, including basic coverage with no options for all available classes of property, how much (if any) would be payable in the following described loss: A camera was included in the blanket coverage for $500. While in the insured's car, it was caught in a flash flood and was a total loss. The company found it could be replaced for $350?"
$350 payable; Loss is not excluded and coverage is for the lesser of ACV, cost to repair or replace or the limit specified for coverage. basic meaning ACV - camera cost $350 insurance carrier replaced it for that amount
If an insured had a personal articles floater, including basic coverage with no options for all available classes of property, how much (if any) would be payable in the following described loss:" 'The insured had a large home electric organ scheduled for $4,000. It had been removed to a shop for repairs, and the repair shop burned down. The lowest cost for a reasonable replacement was $5,000'"
$4,000 payable; Loss is not excluded and coverage is for the lesser of ACV or cost to repair or replace.
If a flood is confined to a single premise, how many acres does it have to cover?
2 acres
Which one of these watercraft exposures is not covered by Section II personal liability?
26 HP outboard motorboat owned by the insured at inception of the policy
An insured has an HO-3, no endorsements, with following limits: A - $70,000, B - $7,000, C - $35,000, D - $14,000. The policy has a $250 deductible ($500 deductible for windstorm/hurricane). What is the amount payable (if any) when: "A windstorm caused extensive damage to the roof of the insured's residence, requiring replacement of a portion. Cost to replace was $5,000. Taking depreciation into account, the actual cash value was $3,000. Coverage is written on a replacement cost basis. At the time of the loss, the replacement value of the dwelling was $125,000"?
3,500 is payable. For replacement cost settlement, the insured needed 80% of the replacement value ($125,000 x 80%=$100,000)
What is the standard deductible of section I-property coverage of a homeowner's insurance policy?
A section I standard deductible which applies to the insured's loss in each occurrence is $500 for all perils other than hurricane
What is the standard deductible of section I-property coverage of a homeowner's insurance policy?
A section I standard deductible which applies to the insured's loss in each occurrence is $500 for all perils other than hurricane.
An insured has an HO-3, no endorsements, with following limits: A - $70,000, B - $7,000, C - $35,000, D - $14,000. The policy has a $250 deductible ($500 deductible for windstorm/hurricane). What is the amount payable (if any) when: "In a fire the insured's fur coat valued at $2,000 was destroyed"?
A. $1,750 is payable
If an insured had a personal articles floater, including basic coverage with no options for all available classes of property, how much (if any) would be payable in the following described loss: "For silverware, the insured had a sterling silver service scheduled for $2,000 coverage. The insured purchased some silver place settings at a cost of $700. Two weeks later, both the scheduled item and the new place settings were stolen?"
A. $2,000 payable; Silverware does not include automatic coverage for newly acquired property.
The homeowner's policy Section II personal liability section offers an optional coverage known as 'personal injury liability' which covers which of the following perils?
A. All of the answers are correct B. Wrongful entry Incorrect C. Malicious prosecution D. False arrest ALL ARE CORRECT
Which optional coverages are available with dwelling fire policies?
A. All of the answers are correct Correct B. Condominium loss assessments C. Building ordinance and law D. Business personal property all are correct
What are the general conditions in section II of a homeowner's policy?
A. All of the answers are correct Correct B. They provide for various details such as assignments C. They provide for various details such as changes D. They provide for various details such as subrogation and death of the insured ALL ARE CORRECT
Dwelling fire policies exclude all the following types of losses except?
A. All of the answers are excluded Correct B. Building ordinance & law enforcement C. Power interruption due to off premises damage D. Backing up of sewers and drains all are excluded
Describe section II, liability coverage in a homeowner's policy.
A. Coverage E - Liability protects the insured from legal liability for bodily injury or property damage to others. B. Both answers are correct Correct C. Neither answer is correct D. Coverage F - Medical Payments to Others pays for medical and other related expenses for members of the public.
Which of the following statements is false?
A. DP3 policy covers the building on an 'all risk' basis B. All of the answers are correct Incorrect C. DP2 policy covers both building and contents at replacement cost D. DP1 policy covers both Dwelling & Contents at Actual Cash Value c - is incorrect
Who is eligible for the homeowner's program?
A. Eligibility is limited to owner-occupants of 1-4 family dwellings B. Both answers are correct Correct C. The program is designed for the personal non-business risk D. Neither answer is correct BOTH ARE CORRECT
How do the 6 homeowner forms apply in a homeowner's insurance policy?
A. HO-4 applies for renters, or those who occupy a residence in an ineligible building B. All of the answers are correct Correct C. HO-6 is for condominium unit-owners and cooperative apartment dwellers D. Forms HO-2, 3, 5 and 8 apply only for owner-occupants of one to four family dwellings ALL ARE CORRECT
What form will be issued in a homeowner's insurance policy if the two owner occupants jointly own a two family dwelling?
A. HO-4 may be issued to the other co-owner. B. Neither answer is correct C. Both answers are correct Correct D. HO-2, HO-3, HO-5 or HO-8 may be issued in the name of one co-owner (with the interest of the other co-owner in the dwelling included) both are correct
How are dwellings defined under Property Insurance?
A. Household personal property in any apartment, cooperative or condominium used as living quarters or rented to others B. Single family either owner occupied or leased by the owner C. All of the answers are correct Correct D. 1 to a maximum 4 apartment or family units ALL ARE CORRECT
Which of the following items will the dwelling fire policy's declaration page identify?
A. Limits and premiums B. Insured and insured location C. All of the answers are correct Correct D. Policy period and policy number all are correct
Identify which homeowner' additional coverages limit is incorrect?
A. Loss assessment with a $1,000 limit B. All of the answers are correct C. Unlimited defense costs for claim expense Incorrect D. Unlimited first aid expense all are correct
The homeowner's policy Section II personal liability section offers an optional coverage known as 'personal injury liability' which covers which of the following perils?
A. Malicious prosecution B. All of the answers are correct Correct C. False arrest D. Wrongful entry ALL ARE CORRECT
Homeowner's Coverage C "Personal Property" exclusions include which of these items?
A. Personal property of a non- related border B. All of the answers are correct C. Tape decks, CB radios and equipment exclusive to an automobile Incorrect D. Jewelry coverage on an inland marine jewelry floater ALL ARE CORRECT
What are the exclusions in section II of a homeowner's policy?
A. The policy limits coverage as to business or professional activities B. The policy limits coverage as to watercraft C. All of the answers are correct Correct D. The policy limits coverage as to motorized land conveyances ALL ARE CORRECT
What are the exclusions in section II of a homeowner's policy?
A. The policy limits coverage as to watercraft B. The policy limits coverage as to business or professional activities C. All of the answers are correct Correct D. The policy limits coverage as to motorized land conveyances ALL ARE CORRECT
