Insurance

Alexander has covered a home he has inherited under a DP-1 form with the EC perils included. The home is situated on property that has been passed down in Alexander's family for generations and there is a fairly large family cemetery on the property. How much coverage would Alexander have under Coverage B of his policy, to cover the grave markers and mausoleums in his family cemetery?

$0

Dan insures a home for adequate limits under a DP-2. If a flood causes $1,000 in damage, what is the maximum the insurer will pay, disregarding deductibles?

$0

The insured suffered a severe storm and some of his trees, shrubs, and plants are heavily damaged by the wind. How much coverage could the insured expect to receive for his claim under his DP-3 Dwelling policy?

$0

Section I of the Homeowners forms provides up to _________ when the insured is assessed by a corporation or property owner's association for damage to property owned collectively, but only if it was damaged by a peril insured against under Coverage A of the Policy.

$1,000

If the insured carries a DP-2 Dwelling form and insures the dwelling for 80% of its replacement cost value, what will he be paid if his 30 year old roof sustains $10,000 in damages (disregarding any deductible)?

$10,000

Mary has insured her one-family home under an HO-3 form with a Coverage A limit of $100,000. If she suffered a $100,000 loss to her covered dwelling, how much coverage would be provided under Coverage B for her unattached garage on the premises?

$10,000

What is the standard minimum limit of liability for Coverage E - Personal Liability coverage on Homeowners policies?

$100,000 per occurrence

Under a standardized DP-2 or DP-3 policy, what is the maximum that would be paid for additional living expenses if Coverage A was $60,000?

$12,000

Under a DP-2 or DP-3 standardized policy what is the maximum that would be paid for one month for additional living expenses if Coverage A was $75,000?

$1250

Blake is covered by a Homeowners policy with a $50,000 Coverage C limit. Disregarding any deductibles, what is the most Blake can collect if his $1,500 boat is stolen from the insured premises?

$1500

The insured has suffered roof damage as a result of a tornado. He makes temporary repairs until permanent repairs can be made. He spends $1500 for his work. How much, if any amount, will the DP-2 Dwelling policy pay on the repairs?

$1500

True about Broad Theft coverage endorsement to a Dwelling policy

$1500 of coverage is available to theft of a watercraft, owner-occupied dwellings are covered for theft of personal property, coverage is provided both on and off premises.

The insured owns a one-family dwelling with a detached garage. The dwelling is insured for $200,000. How much coverage applies to the detached garage?

$20,000

Don is having a new home built. He has purchased a Dwelling policy to insured the home and has attached the Dwelling Under Construction endorsement. The policy limit for the completed dwelling is $200,00. Don's home is 15% complete when a covered loss occurs. How much of the coverage limit will apply to the loss?

$30,000

A standard Homeowners policy has been issued to cover a one-family structure with a coverage limit of $75,000 on the dwelling (coverage A). What is the automatic amount of insurance coverage on personal property (coverage c)?

$37,500

An insured is covered under an HO-2 form with a Coverage A limit of $125,00and a Coverage C limit of $65,000. What amount will automatically be provided for Coverage D?

$37,500

The Homeowners "additional coverages" includes coverage up to ____ for grave markers including mausoleums on or away from the residence premises by a peril insured against.

$5,000

An insured has his home covered under Dwelling policies with three different insurance companies. Company A provides 50% of the coverage, Company B provides 45% of the coverage, and Company C provides 5% of the coverage. When settling a claim for $10,000 worth of damage to the dwelling, what will Company C pay?

$500

The limit of liability for the additional coverage under the standardized Homeowners forms for "Credit Card, Electronic Fund Transfer Card or Access Device, Forgery and Counterfeit Money" is:

$500

What is NOT covered by liability coverage under a Homeowner policy?

A snowmobile in a park

What would be excluded from coverage for loss under coverage c of the homeowners policies>

A valuable baseball card collection owned by the insured's son that is covered under a separate personal articles floater

Loss settlement for personal property that is covered under Coverage C of a standard unendorsed ISO Homeowners policy is on an

Actual Cash Value basis

Under Section II of a Homeowners policy, a cemetery plot owned by the insured is considered to be

An insured location

True about debris remove coverage of the dwelling forms

Coverage A and B both include an amount for debris removal

What coverage would cover "unattached structures" under a homeowners policy?

Coverage B

An insured suffer a partial fire loss to his residence. Under an HO-3 policy what insuring agreement is available to pay for temporary, alternate living quarters?

Coverage D

Homeowners policies provide personal liability coverage that follows an insured anywhere in the world under:

Coverage E

Which coverage a Homeowners policy would pay for damage to a neighbor's window caused by the insured?

Coverage E

What Dwelling forms may provide replacement cost coverage for the dwelling and other structures?

DP-2 and DP-3

The insured awoke and found that a water line on his side of the water meter has broken. Several thousand gallons of water have escaped. The water company bills the insured for the loss of the water, because the breakage in the waterline occurred on his side of the water meter. The insurance company will:

Deny the claim because water is excluded under Coverage C

Coverage A,B,C, and D of Section I of a Homeowners policy are (in order):

Dwelling; Other structures; personal property (contents); Loss of Use

What is excluded under any of the Homeowners forms?

Explosion of a hot water heater that damages carpeting

The additional coverages of the Homeowners forms pay for

Financial loss to the insured resulting from the unauthorized use of his/her credit card. Reasonable temporary repairs to property damaged due to a covered peril. Damage to glass that is part of the covered dwelling

True about perils of the Homeowners forms

Fire or lightning is a named peril for personal property under the HO-3, Riot or civil commotion is under the HO-5, Explosion is under the HP-2 form

What Homeowners forms are intended to cover the possessions of the insured who is leasing an apartment?

HO-4

Isabelle is covered under a standard HP-6 form and must vacate her condominium because an adjacent unit has suffered extensive fire damage. Isabelle will need to collect additional living expenses from Coverage D of her HO-6 form. How will this amount be calculated?

Isabelle will receive 50% of the Coverage C limit she selected when she purchased the policy

True about HO-6 Form

It covers walls, floors, and ceiling of the dwelling unit

Correct about Building Ordinance or Law endorsement to a Dwelling policy

It creates a new coverage on the DP-1 policy

The insured is covered under a standard HO-5 policy. What coverage does the insured have for personal property?

Open perils

True regarding Coverage F - Medical Payments to Others on the Homeowners policies

Pays the medical expenses of others without regard to whether or not the insured was negligent

The insured has his home insured on a HO-2 policy. Lightning has struck the home and causes a fire. The insured takes as much personal property out of the house as possible while waiting for the fire department to arrive and extinguish the fire. The insured and some of his neighbors damage some of the property while moving it to safety in the back of a pickup truck no owned by the insured. What additional coverage would cover this damage to the insured's personal property?

Property removed

True regarding "Building Additions and Alterations" additional coverage of the Homeowners forms

The "additional coverage" is only provided on the HO-4 form. This coverage is not an "additional coverage" on the HO-6 form, it is part of Coverage A. Provides up to 10% of the Coverage C limit to cover fixtures, installations and improvements made or acquired at the insured tenant's expense

True regarding the Homeowners "additional coverage" known as Landlord's Furnishings

The coverage is not additional insurance and does not increase the limits of the policy

An insured is covered under an HO-3 form. If the insured hits his own house and also damages the garage and the attached fence with his vehicle, which of the damages would be covered?

The damage to the house, garage and the fence would all be covered

If an insured covers his home with a standard unendorsed HO-5 form and purchases a Coverage A limit that meet the coinsurance requirement, which if covered on a replacement cost basis?

The dwelling, other structures, and an attached garage

Sarah purchased a 100 year old home that hasn't had significant renovations. She has contacted her insurance company and requested coverage under an HO-3 form. Her insurance company has refused to place the coverage by offered to cover the home under an HO-3 form instead. What would be a reasonable explanation for the insurance company's choice of the HO-8 form?

The insurance company can settle losses under the HO-8 at repair cost instead of the much high replacement cost settlement. Covering an older home on a form that would provide higher limit of liability than the market value of the dwelling, would created a moral hazard. To cover an older home with an HO-3 that provides replacement cost coverage on the dwelling, would require a prohibitively high premium rate.

Not covered under the HO-2 form

The insured hit and damages his fence with his car

Mary intentionally trips her neighbor while the neighbor is trespassing on the insured's property. Although the neighbor is not injured, Mary gives the neighbor $500 in cash to settle any potential liability claim. How will Mary's insurance company most likely respond in this situation?

The insurer will deny liability coverage because Mary's action was intentional

An insured does not carry enough insurance to comply with the coinsurance clause of his Homeowners policy. If the insured would have a loss to his covered home, how ill the insurer settle the loss?

The insurer will either settle the loss at ACV, or pay the proportion of the cost to repair or replace the part of the building that was damaged, based on the amount of insurance the insured carried

Sebastian puts a roast in the oven and decides to go to the movies, thinking that he has plenty of time before roast will be fully cooked. After the movie, he is caught behind a car accident and it takes him several hours to get home. When Sebastian finally arrives home, the roast is completely blackened and the contents of his home are thoroughly covered in soot from the smoke. How would this claim be handled under a Homeowners policy?

The loss would be covered under the peril of smoke

The insured is wearing a diamond ring while on vacation in Europe. Her ring is valued at $1500 is stolen. What coverage would apply under her Homeowners policy?

The policy will pay the loss less the deductible

If an insured is covered an HO-2 policy, damage caused by wind to his/her personal property would be covered if:

The wind created an opening in the structure, allowing the wind to damage the personal property inside

Tom rents half of a duplex. During a severe storm, lightning strikes a tree in the front yard and it falls, causing damage on Tom's side of the duplex. What losses will be covered by Tom's HO-4 policy?

Tom's TV and entertainment system that were damaged when the tree fell through the roof

What is covered under basic form peril of the homeowners policies?

Volcanic eruption

An insured has her dwelling covered by an HO-3, with a $500,000 limit of liability for Coverage A. A fire breaks out and the dwelling is a total loss. The entire $500,000 limit is used to cover the direct physical damage to the dwelling. However, there is a large amount of debris from the burned structure covering the insured's property that will need to be removed. In this situation, how ill the cost of the debris removal be paid?

When the entire Coverage A limit is used to cover the direct physical damage to the dwelling, an additional 5% of the Coverage A limit will be added to cover debris removal

Loss to insured property caused by self-propelled missiles is covered under which perils of the homeowners form?

aircraft

The definition of "collapse" as defined in t\he additional coverage of the Homeowners forms includes:

an abrupt falling down or caving in of the structure or a part of the structure.

Section I of Homeowners policies cover

locations owned by the named insured that are not described on the declarations page of the policy

Because a Homeowners policy provides both property and liability coverage in a single policy, the policy is called

multi-line policy

True about Sections of a homeowners policy

section I coverages vary greatly between the different HO forms

Not on an open peril exclusions of the HO-3 and HP-5 form

theft

What is eligible to be named insured under a Homeowners policy?

trust

Items that have a special limit of liability for Coverage C of the Homeowners forms

watercraft, securities, gold

Martika is covered undrsed, standard HO-3 policy and suffers a loss to an awning that covers her desk. The cost to purchase a new awning is $900, however the awning can be repaired for $300. The actual cash of the awning is $750. How will this claim will settled with the insurance company?

will pay $300 for the awning

Under Coverage F - Medical Payments in Section II of the standard Homeowners policies, medical expenses for the injured party will be paid as long as the claim is submitted:

within three years of the date of the accident

An insured has received actual cash value payment from the adjuster for a covered loss. At the time he is satisfied with the payment. He later changes his mind and wants the full replacement value. How many days does he have to submit the receipts to get the replacement cost payment under HO-3 form?

180 days

The standardized dwelling forms allow the insured to bring legal action against the insurer if they have complied with all policy provisions and the actions is brought within:

2 years after the date of the loss

Not eligible for coverage under any of the Homeowners forms?

a residence located on a farm

Not Covered under Coverage B of a Homeowners policy

a roof of a covered dwelling

The peril insured against by a Homeowners policy are contained within the:

insuring agreements

Coverage D- Loss of Use on the Homeowners forms provides coverage for "Civil Authority Prohibits Use" for:

no more than 2 weeks

A Homeowners policy is a personal package policy. Advantages of a personal package policy?

package policies simplify the billing process for insurance companies, fewer gaps in coverage exist with package policies, insureds enjoy lower premiums with package policies

The standard deductible in Section I of the Homeowners forms is:

$500

When an HO-3 is issued with a $75,000 Coverage A limit on a one-family dwelling, what is the automatic amount of insurance for coverage B?

$7,500

Homeowner policies cover:

A dwelling owned by a life estate, owner-occupied residence with up to 2 boarders permitted, incidental business occupancies

Lightning strikes a 50-foot oak tree in an insured's yard splitting the tree in half. The tree falls hitting several small trees causing extensive damage to the trees and scattering debris in the yard. The HO-2 Homeowners Policy will pay:

A maximum of $500 per tree

A standardized homeowners policy is best described as:

A package policy that provides both property and liability insurance

The "automatic Increase in Insurance" endorsement to a dwelling policy provides an increase in coverage

Annually

What Dwelling forms provide broad perils coverage for personal property?

DP-2 and DP-3 Only

Which is not an additional coverage under Homeowners liability - section II coverage?

Damage to "property owned by the insured"

True regarding the peril of theft under the Homeowners policies

The HO-8 form specifies a limit of $1,000 for theft

True about Windstorm or Hail endorsement to the Dwelling Policy form

The amount of coverage available for purchase and the deductible amount is determined by the area within a state the covered dwelling is located, The amount of coverage that can be provided by this endorsement is set by state statute, The deductible amount on the endorsement is set by state statute.

True about Dwelling Under Construction endorsement to a Dwelling policy

The available policy limit of the endorsement increases as construction of the dwelling progresses, the endorsement must be purchased by the intended occupant of the dwelling when it is complete, the intended occupant of the dwelling under construction must be the named insured on the dwelling policy

and insured under an unendorsed Homeowners policy can be

a 14 year old of whom the named insured has custody, the spouse of the named insured who is also a resident of the insured location, the named insured's 22 year old daughter who is a full time graduate student

Sam's home is located in a rural area and is covered by standardized a DP-2 Dwelling form with a $500 deductible form attached. He experiences a fire at his home and has to call the local volunteer fire department to extinguish the fire. He receives a bill from the fire department in the amount of $800. How much of the bill will Sam's DP-2 form cover?

$500

A standard Homeowners policy has been issued with a $300,00 limit to cover a four-family dwelling. What is the automatic amount that will be provided for Coverage C?

$75,000

Jeremy's home is valued at $950,000. How much insurance does he need to carry on his home, in order to comply with the coinsurance requirement of a Homeowners insurance policy?

$760,000

If an insured carries Coverage C under a Dwelling policy, how much coverage applies off the insured premises (world-wide basis)?

10% of the Coverage C limit

Personal property normally kept at other residences owned or rented to the insured is covered under the Homeowners forms for:

10% of the Coverage C limit or $1,000, whichever amount is larger

How would coverage would be provided for trees, shrubs, or other plants under the additional coverages of the standard Homeowners policies?

A neighbor, driving his own vehicle, accidentally runs over the insured's holly tree when he runs off his own driveway and into the insured's yard

what dwelling types would be eligible for the Limited Theft coverage endorsement to their Dwelling policy?

A non-owner-occupied one-family dwelling

A deductible applies to all additional coverages under the standard Homeowners forms except:

Fire Department Service Charge

What is considered an "incidental occupancy" under a Homeowners policy?

an art studio in the named insured's home, where she also hold occasional painting classes

Flora designs and makes custom dresses out of a small room at the back of the home she owns. She has the home covered by a Dwelling policy with the Permitted Incidental Occupancies endorsement attached. She has boxed up several dresses and stored them in the back room to be shipped out later when fire breaks out and burns them up. How much coverage will Flora's endorsed Dwelling policy provide?

up to $10,000

Correct about coverage endorsement for grave markers under a Dwelling policy

up to $5,000 coverage is provided for grave markers and mausoleums on the covered premises described in the policy

Under an HO-6 form, the additional coverage for damage to trees, shrubs and other plants is provided at:

10% of the Coverage C limit, or a maximum of $500 for any one tree, shrub, or other plant.

Not covered under Coverage B of the Homeowners forms

a separate building on the insured premises used for business

Another person may be listed as an "insured" on a Dwelling policy by attaching the "additional insured" endorsement. The additional person listed on the endorsement must:

have insurable insurable interest in the premises covered by the Dwelling Policy

Perry has his home covered under an HO-5 policy. He borrows a friend's expensive camera and takes it on vacation, where it is stolen. Coverage for the stolen camera is:

included anywhere in the world

Under a standard HO-3, the limit for Coverage C-Personal Property for a one or two-family dwelling:

is set at 50% of Coverage A