State Property Exam Over Chapter 2. Personal Insurance Coverages

Harold's building has standard fire coverage, but Harold has purchased separate policies from three different companies. Each of the three companies' policy limit is $100,000. According to the pro rata liability clause, in the event of a loss how much will each company pay for the loss? A: 33 1/3% B: $100,000 C: Only the primary company will be liable D: The primary company will pay 50% of the loss, and the remaining 50% will be shared equally between the other 2 companies

A; Pro rata prevents an insured from collecting overinsurance from multiple policies. Pro rata clause limits the liability of the insurer to a portion of the loss no greater than the amount the insured bears to the whole insurance covering the property whether collected or not.

All of the following would be eligible for coverage under the dwelling policy EXCEPT? A: Up to 5 roomers or boarders B: A house that has 5 residential units C: Owner occupied, tenant occupied, or both D: A dwelling in the course of construction

B; Eligibility requires that the dwelling have not more than 4 family units

The appraisal clause of the standard fire policy allows for the process of settling disputes over the ACV of the property or the amount of loss. When disputes arise, each party (insurer and the insured) must select an impartial appraisal within? A: 45 Days B: 10 Days C: 20 Days D: 30 Days

C

Which of the following is TRUE regarding the Standard fire policy on how they will replace your home due to a loss? A: Agreed Value B: Market Value C: AVC D: Replacement Cost

C

The standard fire policy limits legal action against the insurance company to how many years? A: 1 Years B: 2 Years C: 5 Years D: 3 Years

D

Removal coverage under a standard fire policy remains in effect for? A: 5 days. B: 10 days. C: 30 days. D: 15 days.

A

When time does the Standard Fire Policy term begin, end and where at? A: 12:01am Standard Time at the location of the property involved B: 12:00pm Standard Time at the location of the insured C: 12:00am Standard time at the location of the insured D: 12:01pm Standard time at the location of the property involved

A

Which BEST describes the perils covered under a standard fire policy? A: Named perils contract B: All risks perils contract C: Basic perils contract D: Broad perils contract

A

Which of the following is NOT an excluded loss in the Standard Fire Policy? A: Government Action B: Insured's neglect to reasonably save or preserve the property C: Any loss occurring when building is vacant or unoccupied for 60 days or more D: Theft

A

Which types of losses are covered by the standard fire policy? A: Direct losses only B: Indirect losses only C: Both direct and indirect losses D: Neither

A

All of the following are duties of the insured following a loss in a standard fire policy EXCEPT? A: Notify the insurer in writing immediately following the loss B: Protect the property from further damage C: Submit a signed proof of loss within 30 days D: Furnish a complete, detailed inventory including values

C; Submit a signed proof of loss within 60 days, stating the time of loss and origin of loss, the interest of all parties in the property, if other insurance is involved and the values of each item

All of the following are options of the insurer in the loss settlement of a standard fire policy EXCEPT? A: Take possession of the damaged property B: Repair or replace the property C: Rebuild the property with material of like kind and quality D: Pay replacement cost value

D

Standard fire policies specify the time for the inception and expiration of coverage. Which of the following is the most common time? A: Noon B: Midnight C: 12:01 PM D: 12:01 AM

D

Which of the following is not a covered peril under the Standard Fire policy? A: Fire B: Removal from the premises any property endangered by a covered peril C: Lightning D: Actions of war

D