Insurance Licensing - Chapter 4: Dwelling Policy

The limit of insurance for the Other Coverage Trees, Shrubs, and Other Plants is provided at which percentage of the Coverage A limit? a. 5% b. 10% c. 50% d. 100%

a. 5%

An attached carport is covered under which of the following coverages? a. Coverage A b. Coverage B c. Coverage C d. Coverage D

a. Coverage A

Which is true regarding Dwelling policies? a. Coverage C applies while insured property is located at the described location b. Coverage D is considered a direct loss coverage c. Coverage C includes coverage for personal property of tenants and boarders d. Coverage B would cover an attached garage

a. Coverage C applies while insured property is located at the described location

Which of the following dwelling forms pays for losses to the dwelling on an actual cash value basis? a. DP-1 b. DP-2 c. DP-3 d. DP-4

a. DP-1

Which of the following coverages is not provided by the Personal Liability endorsement? a. Injury caused to a regular resident of the dwelling b. Defense costs c. Medical payments to others d. First aid expenses

a. Injury caused to a regular resident of the dwelling

All of the following statements are TRUE about the Broad Theft Coverage endorsement, EXCEPT? a. It does not apply to the DP-1 b. Both on- and off-premises coverage is available c. Theft and attempted theft are covered d. Resulting damage caused by malicious mischief and vandalism

a. It does not apply to the DP-1

The DP-3 insures personal property against the same perils as: a. The DP-2 Personal Property Coverage b. The DP-3 Dwelling coverage c. The DP-1 Dwelling Coverage d. The DP-1 Personal Property Coverage

a. The DP-2 Personal Property Coverage

The Limited Theft Coverage endorsement to the DP is used under which of the following circumstances? a. The insured dwelling is tenant-occupied b. The dwelling has been vacant for more than 60 days c. Coverage is desired for off-premises property d. The insured dwelling is owner-occupied

a. The insured dwelling is tenant-occupied

he Dwelling Broad Form (DP-2) insures against all of the following perils, except: a. Theft b. Breakage of glass that is a part of a building, storm door or window c. Damage caused by burglars d. Accidental discharge or overflow

a. Theft

Which of the following is correct regarding damage caused by vandalism under the Basic Dwelling Form? a. Vandalism coverage must be added by the V&MM endorsement b. It is covered as an extended coverage peril c. Vandalism of vacant buildings is automatically covered d. It is covered as a basic peril

a. Vandalism coverage must be added by the V&MM endorsement

Policyholder L has a DP-1 with a Coverage A amount of $300,000. Following a severe storm, she suffers a covered loss to the dwelling of $275,000 and a covered loss to a detached swimming pool of $30,000. How much will L's policy pay? a. $275,000 b. $300,000 c. $250,000 d. $305,000

b. $300,000

An insured tenant may use up to what percentage of Coverage C to improve the premises? a. 20% b. 10% c. 5% d. 0%

b. 10%

The Automatic Increase in Insurance endorsement typically increases Coverages A and B by which of the following? a. Flat amount b. A percentage designated on the endorsement c. $10,000 d. $23,500

b. A percentage designated on the endorsement

Which of the following does not apply to the Other Coverage Glass or Safety Glazing Material? a. Covers glass that is part of a covered structure b. Applies to all Dwelling forms c. No coverage applies if a dwelling is vacant for 60 consecutive days before the loss d. May be settled on a replacement cost basis

b. Applies to all Dwelling forms

All of the following are types of property NOT covered under Coverage C - Personal Property, except: a. A dog b. Canoes c. Motor vehicles d. Credit cards or fund transfer cards

b. Canoes

All of the following is covered under Coverage B - Other Structures, except: a. Swimming pool b. Construction materials c. Shed d. Storage building

b. Construction materials

Water damage caused by which of the following is a covered loss under the Dwelling policy? a. Water below the surface of the ground b. Discharge caused by a plumbing failure c. Leaks through a driveway d. Overflow of water from a sump pump

b. Discharge caused by a plumbing failure

The Earth Movement exclusion contains all of the following perils, except: a. Mudflow b. Explosion c. Landslide d. Earthquake

b. Explosion

Sudden and accidental damage from artificially generated electrical current best describes a(n): a. Mechanical breakdown b. Power surge c. Power failure d. Internal explosion

b. Power surge

Which of the following perils is not covered under the Dwelling Broad Form? a. Weight of ice and snow b. Smoke damage from industrial operations c. Vehicle damage to the dwelling d. Burglary damage

b. Smoke damage from industrial operations

Which statement is true concerning Dwelling policies? a. The Basic Form pays for losses to the dwelling on a replacement cost basis b. The Special Form insures the dwelling on an open perils basis, and insures the contents against the broad form perils c. 100% of Coverage C applies to worldwide coverage d. The Special Form automatically covers the contents against the peril of theft

b. The Special Form insures the dwelling on an open perils basis, and insures the contents against the broad form perils

Which of the following statements about Fire Department Service Charge coverage is not correct? a. The policy deductible does not apply to this coverage b. The policy will pay up to $1,000 for Fire Department Service Charge coverage c. Fire Department Service Charge coverage is included under all Dwelling policy forms d. Coverage does not apply if the property is located within the limits of the jurisdiction furnishing the fire department response

b. The policy will pay up to $1,000 for Fire Department Service Charge coverage

All of the following are eligible for coverage under the Dwelling Program, except: a. A duplex b. A vacation home used as a secondary residence c. A beauty shop with a small bedroom attached d. A single-family home in the suburbs

c. A beauty shop with a small bedroom attached

The abrupt falling down or caving in of a building disallowing it to be used for its intended purpose is the definition of: a. Earth movement b. Defective planning c. Collapse d. Settling

c. Collapse

Which coverage pays for the loss of rents due to direct loss to the dwelling from a covered peril? a. Coverage B b. Coverage C c. Coverage D d. Coverage E

c. Coverage D

All of the following statements are correct regarding Coverage E, except: a. Additional living expense coverage is available if the dwelling is uninhabitable b. Additional living expenses include the boarding of pets c. Coverage E is available under all Dwelling policy forms d. Coverage applies to the extent of the insured's normal standard of living

c. Coverage E is available under all Dwelling policy forms

Which of the following dwelling program forms covers the building on an open peril basis? a. DP-1 b. DP-2 c. DP-3 d. DP-4

c. DP-3

Which of the following is not eligible for the Dwelling Program? a. Dwelling has 5 roomers b. Dwelling has 4 apartment units c. Dwelling is located on farm property d. Dwelling includes a piano school

c. Dwelling is located on farm property

Which of the following coverages is not provided by the Personal Liability endorsement? a. First aid expenses b. Defense costs c. Injury caused to a regular resident of the dwelling d. Medical payments to others

c. Injury caused to a regular resident of the dwelling

What type of power failure is excluded under all of the dwelling forms? a. Power failure that occurs on the insured premises b. Power failure that causes a fire to a neighboring property c. Power failure that occurs off the insured premises d. Power failure that causes a fire on the described location

c. Power failure that occurs off the insured premises

Which of the following is true of a Dwelling Form? a. The Basic Form covers the contents on an open perils basis b. The Basic Form covers the contents against theft c. The Special Form covers the building and other structures on an open perils basis d. The Broad Form covers the cost to repair defective plumbing

c. The Special Form covers the building and other structures on an open perils basis

Under Coverage C of the Special Dwelling Form, all of the following are included, except: a. Property of others that is in the care, custody and control of the insured b. At the insured's option, property of guests and servants c. The insured's golden retriever d. Household and personal property

c. The insured's golden retriever

Which form would not insure against external explosion? a. DP-2 b. DP-3 c. Unendorsed DP-1 d. Endorsed DP-1

c. Unendorsed DP-1

Which form would not insure against external explosion? a. DP-3 b. Endorsed DP-1 c. Unendorsed DP-1 d. DP-2

c. Unendorsed DP-1

Coverage D covers which of the following losses? a. Damage to a swimming pool b. Loss of rental income due to the cancellation of a lease c. Additional Living Expense d. Access prevented by a civil authority because of a neighboring location's direct loss by a peril covered under the insured's policy

d. Access prevented by a civil authority because of a neighboring location's direct loss by a peril covered under the insured's policy

Coverage D covers which of the following losses? a. Loss of rental income due to the cancellation of a lease b. Damage to a swimming pool c. Additional Living Expense d. Access prevented by a civil authority because of a neighboring location's direct loss by a peril covered under the insured's policy

d. Access prevented by a civil authority because of a neighboring location's direct loss by a peril covered under the insured's policy

Which DP form does not cover burglar damage? a. Broad Form (DP-2) b. None of the Dwelling Policies cover damage done by burglars c. Special Form (DP-3) d. Basic Form (DP-1)

d. Basic Form (DP-1)

All of the following are true of Dwelling Special Form, except: a. Losses to the dwelling are paid on a replacement cost basis b. The dwelling must be used principally for residential dwelling purposes c. Mobile homes are not eligible d. Both the dwelling and contents are covered on an open perils basis

d. Both the dwelling and contents are covered on an open perils basis

Which is true of the Dwelling policy Special Form? a. Losses to the dwelling are paid on an actual cash value basis b. The form will cover the theft of contents c. The form will cover the cracking of walls d. Contents are covered on an actual cash value basis

d. Contents are covered on an actual cash value basis

Which is true regarding Dwelling policies? a. Coverage C includes coverage for personal property of tenants and boarders b. Coverage B would cover an attached garage c. Coverage D is considered a direct loss coverage d. Coverage C applies while insured property is located at the described location

d. Coverage C applies while insured property is located at the described location

The Personal Liability endorsement includes each of the following additional coverages, except: a. First aid expenses b. Damage to the property of others c. Claims expenses d. Debris removal

d. Debris removal

Which of the following properties is ineligible to be insured under a Dwelling Policy? a. Dwellings containing three apartment units b. Dwellings with any type of business in them c. Mobile homes d. Farms

d. Farms

Which of the following coverages is not provided by the Personal Liability endorsement? a. First aid expenses b. Medical payments to others c. Defense costs d. Injury caused to a regular resident of the dwelling

d. Injury caused to a regular resident of the dwelling

Which of the following is NOT true about coverage for Property Removed? a. Property is covered while being removed from the premises to avoid a covered loss b. Coverage applies under the DP-3 form for 30 days while the property is removed c. Coverage does not increase the limit of insurance that applies to the property removed d. Property coverage applies under the DP-1 policy for 30 days while the property is removed

d. Property coverage applies under the DP-1 policy for 30 days while the property is removed

Which of the following describes the loss settlement basis for a fire damage claim to a dwelling insured under a DP-3 policy? a. Replacement cost up to the Coverage B limit b. Actual cash value of the dwelling up to the Coverage B limit c. Actual cash value of the dwelling up to the Coverage A limit d. Replacement cost up to the Coverage A limit

d. Replacement cost up to the Coverage A limit

Which of the following is true under the Dwelling policy? a. The Basic Form covers loss to trees, shrubs and plants b. The Broad Form automatically covers contents against theft c. The Special Form covers contents on an open perils basis d. The Basic Form covers the perils of fire, lightning and internal explosion

d. The Basic Form covers the perils of fire, lightning and internal explosion

Which of the following statements about the DP-3 Policy is false? a. Losses to the dwelling are paid on a replacement cost basis b. The insured dwelling must be used principally for dwelling purposes c. Mobile homes are not eligible d. The dwelling and contents are both covered on an open perils basis

d. The dwelling and contents are both covered on an open perils basis

All of the following are true regarding Dwelling policy eligibility, except: a. Mobile homes are eligible if written on a DP-1 b. Farm dwellings are not eligible c. Some incidental business occupancies are permitted d. The dwelling must be used for seasonal or secondary purposes

d. The dwelling must be used for seasonal or secondary purposes

All of the following are covered perils under the Extended Coverage Endorsement to the DP-1, except: a. Vehicles b. Volcanic eruption c. Windstorm d. Weight of ice, snow or sleet

d. Weight of ice, snow or sleet