Commercial Property Insurance Review

A new definition of collapse has been included in the newer commercial property cause of loss forms that provide this coverage. The main difference is: A. The collapse can be a gradual falling down or caving in of the structure; B. The entire building must fall down or cave in.; C. The collapse must involve an abrupt falling down or caving in of the structure or a part of the structure; D. Coverage is provided if caused by hidden insect or vermin damage if the insured knew about it prior to the collapse.

C. The collapse must be an abrupt falling down or caving in of the structure and not a gradual collapse.

The insured has transported a portion of his property to an exhibition trade show. It is destroyed by a fire. What coverage would apply? A. Property off the premises is not covered; B. Fire is not covered for this exposure; C. A limit of "10,000 would apply to cover the loss; D. Special coverage would have to be purchased to cover property off the premises.

C. The policy will pay up to $10,000 for this type of claim for property "off premises".

Under the Commercial Building and Personal Property form, the term "building" includes: A. Additions and extensions to the building; B. Property used to service the building; C. A heating system; d. All of the above

D. All of these items are part of building coverage.

Earth movement is covered under which of the following Causes of Loss form? A. None B. Basic C. Broad only D. Basic and Broad

A. Earth movement is excluded unless earthquake coverage is purchased.

All of the following are excluded under the Commercial Building and Personal Property form EXCEPT: A. Furniture and fixtures; B. Petty cash and IOUs; C. A watch dog; D. The insured's panel truck

A. Furniture and fixtures are covered under the property covered provision of the building and personal form. The other items are specifically excluded from coverage.

All of the following provide an additional amount of insurance under the commercial building and personal property form EXCEPT: A. Lottery Tickets; B. Newly acquired property; C. Property off-premises; D. Outdoor property

A. Lottery tickets are not covered property.

The deductible under the new commercial property forms is: A. $500; B. $1000; C. $250; D. $750

A. The deductible is $500 under the commercial property form. It can be increased to higher deductibles with a savings in premium.

The insured has suffered a cracked steam boiler loss. What coverage would apply under the commercial property cause of loss forms? A. The loss would be covered; B. The loss is not covered; C. Only part of the loss is covered; D. Covers only the extra expense in replacing the boiler

B. A cracked steam boiler is not a covered loss under the commercial property forms. Equipment breakdown coverage would cover this claim.

The Commercial Building and Personal Property Coverage form excludes all of the following types of property except: A. Securities; B. Property of others in the insured's care; C. Land; D. Walkways adjacent to the insured premises.

B. Coverage C of the form provides coverage for property of others in the insured's care custody and control.

If the civil authority blocks access to the insured's premises because of a covered peril that has damaged a building down the street, what period of time will the business income forms pay the insured for loss of income at his/her premises? A. One week; B. Two weeks; C. Four weeks; D. Three weeks

D. After a 72-hour waiting period, the policy would pay up to three weeks.

Volcanic Action is covered under which of the following Causes of Loss form? A. None; B. Basic; C. Broad only; d. Both Basic and Broad

D. All of the cause of loss forms (basic, broad and special) cover volcanic eruption but not earthquakes as a result of a volcanic eruption. The attachment of the Earthquake and Volcanic Eruption endorsement provides this coverage.

Sprinkler leakage is covered under which of the following Causes of Loss form? A. Basic; B. Broad; C. Special; D. All of the above

D. All of the cause of loss forms cover sprinkler leakage.

Sinkhole collapse is covered under which of the following causes of loss form? A. Basic; B. Broad; C. Special; D. All of the above

D. All of the commercial property forms cover sinkhole collapse coverage.

Which of the following is not coverd property under the commercial property form? A. Accounts, bills and currency; B. Animals not held for sale; C. Cost of foundations; D. All of the above.

D. All of the items are specifically excluded from coverage.

Extra Expense insurance covers the cost of: A. Relocation; B. Temporary location; C. Research costs to replace lost information; D. All of the above.

D. All of the responses are as to what is paid under extra expense coverage.

The endorsement Earthquake and Volcanic Eruption provides coverage: A. Against earthquake from volcanic eruption; B. For commercial buildings and other covered property when used in conjunction with another causes of loss form; C. For damage caused by shocks that occur within 168-hours after policy expiration if these shocks began during the policy period.; D. All of the above.

D. All of the responses are correct.

The Special Causes of Loss form excludes all of the following EXCEPT: A. Loss of market; B. Loss due to artificially generated electric current; C. Agricultural smudging; D. None of these are exceptions.

D. All of the responses are not covered by commercial property insurance.

Under the Commercial Building and Personal Property form, the term "business personal property" includes: A. Furniture; B. Machinery; C. Stock; D. All of the above

D. All of these are covered under the term "business personal property".

Which of the followng forms cover flood and earthquake damage? A. Building and Personal Property form; B. Special Form; C. Broad Form; D. None of the above

D. Neither flood nor earthquake is covered by any of the forms. Earthquake is covered by adding an endorsement. Flood coverge must be purchased separately under a separate program.

A building valued at $100,000 was insured for $80,000 with a policy containing 80% coinsurance. Disregarding any deductibles, what would the company pay on a $20,000 loss? A. $7,500; B. $5,000; C. $15,000; D. $20,000

D. The insured has complied with the 80% coinsurance clause. Therefore the partial loss of $20,000 will be paid in full.