Segment A - Assignment 2
A building is insured for $200,000 under an agreed value policy. The policy has a $10,000 deductible and the agreed value of the building is $220,000. After suffering a $43,000 loss, the insurer will pay (rounded to the nearest $10) A. $29,090. B. $33,000. C. $39,090. D. $43,000.
A. $29,090.
Omega Holdings owns a building with an actual cash value of $200,000. The property is insured under a Building and Personal Property Coverage Form (BPP) with a building limit of $140,000, an 80 percent coinsurance clause, and a $1,000 deductible. The policy includes a Causes of Loss—Broad Form covering the building. The building suffers $80,000 in fire damage. Which one of the following amounts will Omega's insurer pay? A. $69,000 B. $70,000 C. $79,000 D. $80,000
A. $69,000 The insured should have carried 80% of $200,000 or $160,000. Instead the insured carried only $140,000. [($140,000/$160,000) x $80,000] - $1,000 = $69,000.
Although buildings can be classified in many ways, the system used to classify buildings for purposes of rating commercial property insurance is based on their A. Ability to resist fire. B. Market value. C. Cost of construction. D. Square footage.
A. Ability to resist fire.
According to the Common Policy Conditions used with the ISO Commercial Package Policy, if a cancellation results in a return payment, the refund would be sent to A. The first named insured. B. All named insureds, regardless of how many there are. C. The person whose countersignature appears on the declarations page. D. The producer shown on the declarations page.
A. The first named insured.
A building and its contents are insured under Building and Personal Property Coverage Form (BPP) with the agreed value option in effect. The Limit of Insurance is $1,000,000, with a $5,000 deductible. The agreed value shown in the policy is $1,500,000. How much will the insurer pay if the insured sustains a $300,000 loss by an insured peril? A. $175,000 B. $195,000 C. $200,000 D. $300,000
B. $195,000 [($1,000,000/$1,500,000) X $300,000] - $5,000
Under which one of the following provisions of the Building and Personal Property Coverage Form (BPP) must the insurer be notified within 180 days after the occurrence of loss that a claim will be made under the terms of the optional coverage in order for that optional coverage to pay the maximum benefit available? A. Extension of Replacement Cost to Personal Property of Others B. Replacement Cost C. Inflation Guard D. Agreed Value
B. Replacement Cost
Which one of the following statements is correct with regard to Loss Payment of the Building and Personal Property Coverage Form (BPP)? A. Insurers preferred settlement option is to repair, rebuild, or replace the damaged property with other property of like kind and quality because it keeps loss settlement costs down. B. The condition states that regardless of the value of the loss, the insurer will pay no more than the insured's financial interest in the covered property. C. The Loss Payment condition states that the insurer will pay the cost of repairing or replacing the damaged property, including any increased cost attributable to enforcement of ordinances or laws regulating the construction, use, or repair of the property. D. The insurer has 90 days after receiving a satisfactory proof of loss to notify the insured of its intent to either pay a claim or deny payment.
B. The condition states that regardless of the value of the loss, the insurer will pay no more than the insured's financial interest in the covered property
Who of the following can cancel the ISO Commercial Package Policy by mailing or delivering written notice of cancellation? A. The producer listed on the declarations page B. The first named insured on the declarations page C. Anyone who is listed as a first named insured D. Any "insured" as defined in the policy definitions
B. The first named insured on the declarations page
Which one of the following is correct with respect to the Inspections and Surveys common condition of the Insurance Services Office (ISO) Commercial Package Policy? A. The inspections must be made by the insurer's own personnel. B. The insurer does not make safety inspections, and does not guarantee that conditions are safe or healthful. C. The insurer must inform the insured of the results of such inspections. D. The insurer has an obligation to inspect the insured's premises and operations throughout the policy period.
B. The insurer does not make safety inspections, and does not guarantee that conditions are safe or healthful.
Peter has a Commercial Package Policy (CPP) that has a Building and Personal Property Coverage Form (BPP) with a Causes of Loss - Broad Form covering his building with a $750,000 limit. A tropical storm struck the area near Peter's building and the strong winds tore most of the shingles from the building's roof and shattered multiple windows with flying debris. An outside fixture also sustained heavy damage due to the wind. The total amount of damages was $40,000 for the windows and shingles; and $10,000 for the outside fixture. How much will Peter's insurer pay for damage to his outside fixture? A. The loss is not covered. B. $5,000 C. $10,000 D. $20,000
C. $10,000
Adjacent properties can increase the probability of loss to the insured's building and contents. When rating commercial property exposures, the term used to refer to the hazard posed by adjacent or surrounding properties is A. External rating factor. B. Contiguous hazard. C. External exposure. D. Adjacent risk.
C. External exposure.
Cameron has a Commercial Package Policy (CPP) that has a Building and Personal Property Coverage Form (BPP) with a Causes of Loss - Broad Form covering his building with a $750,000 limit. A tropical storm struck Cameron's building and the strong winds tore most of the shingles from the building's roof and shattered multiple windows with flying debris. The total amount of damages was $20,000 for the windows and $20,000 for the shingles. How much will Cameron's insurer pay for damage to his windows and shingles? A. The damage is not covered B. $20,000 C. $39,000 D. $40,000
D. $40,000 IncorrectIncorrect. Cameron's insurer will pay $40,000. Windstorm is a covered cause of loss for building damage, which includes the roof and windows. No exclusions apply.
Taunton Company (Taunton) has a Commercial Package Policy (CPP) that has a Building and Personal Property Coverage Form (BPP) with a Causes of Loss—Broad Form. Because the building is older and has unique architectural features, Taunton decided to insure the building on a replacement cost basis. There is a $2 million coverage limit on the building, with a 90 percent coinsurance clause and $2,000 deductible. The building was struck by lightning and a resulting fire caused substantial damage to the building. The cost to repair the damaged portion of the building with materials of like kind and quality was $500,000. At the time of the loss, the replacement cost value of the building was determined to be $2.2 million. How much would the insurer pay when the repairs are completed if the replacement cost option is activated? A. $0 B. $448,000 C. $450,000 D. $498,000
D. $498,000 $500,000 minus the $2,000 deductible. No reinsurance penalty will apply because the building was insured at a value above $1,980,000 ($2.2 million x .9).
An insured's office building is valued $500,000, contents valued $100,000 and leased computers valued $50,000. The insured wants to be certain covered property can be repaired or replaced without any coinsurance or depreciation penalties in the event of physical loss or damage. Which Limits and Optional Coverage(s) on the Building and Personal Property Coverage Form would best suit this insured's wants? Select one: A. Seek no Optional Coverages but make sure to provide the insurer a signed statement of values B. Building $500,000 with Agreed Value Optional Coverage; Contents $100,000 with Agreed Value Optional Coverage; Extension of Replacement Cost to Personal Property of Others $50,000 C. Building $480,000 with Replacement Cost Optional Coverages; Contents $80,000 with Replacement Cost and Agreed Value Optional Coverages; Extension of Replacement Cost to Personal Property of Others $40,000 D. Building $500,000 with Replacement Cost and Agreed Value Optional Coverages; Contents $100,000 with Replacement Cost and Agreed Value Optional Coverages; Extension of Replacement Cost to Personal Property of Others $50,000
D. Building $500,000 with Replacement Cost and Agreed Value Optional Coverages; Contents $100,000 with Replacement Cost and Agreed Value Optional Coverages; Extension of Replacement Cost to Personal Property of Others $50,000
The inspections and surveys condition, a common policy condition attached to the ISO Commercial Package Policy, makes it clear that the insurer has the right to inspect the insured premises and A. Will inspect books and records. B. May make safety inspections. C. Will make regular physical inspections. D. May recommend changes
D. May recommend changes
The cost to replace property with new property of like kind and quality less depreciation is referred to as the A. Actual cash value. B. Replacement cost. C. Selling price. D. Depreciated value.
A. Actual cash value.
The policy valuation approach that determines the basis for using new property of like kind and quality and adjusts for depreciation to determine the amount to be paid at the time of a loss is called A. Actual cash value. B. Agreed value. C. Replacement cost. D. Reporting value.
A. Actual cash value.
Which one of the following statements is correct with respect to the Valuation condition of the Building and Personal Property Coverage Form (BPP)? A. The valuation condition cannot be modified. B. Subject to certain exceptions, insured property is valued at its actual cash value (ACV). C. Stock sold but not delivered is valued at replacement cost. D. Improvements and betterments that are not replaced are covered for up to $2,500.
B. Subject to certain exceptions, insured property is valued at its actual cash value (ACV).
The condition of the Building and Personal Property Coverage Form (BPP) that establishes a method for the insurer and the insured to resolve disputes about the insured property's value or amount of loss is referred to as the A. Mediation condition. B. Arbitration condition. C. Appraisal condition. D. Dispute resolution condition.
C. Appraisal condition.
An insured is reviewing the Commercial Package Policy (CPP) to determine which conditions apply to all coverage parts in the policy. One of those conditions states that A. The insurer will inspect the property to verify the compliance with safety regulations. B. Both the insured and insurer can cancel the policy with 30 days notice for certain reasons. C. The insurer has the right to do an on-site inspection of the insured's books and records. D. Changes can be made by the insurer or insured by verbally contacting the other
C. The insurer has the right to do an on-site inspection of the insured's books and records.
The type of activities conducted inside a building, some of which are riskier than others, is referred to as the A. Tenancy. B. Enterprise. C. Utilization. D. Occupancy.
D. Occupancy.
Which one of the following statements is correct with respect to the Concealment, Misrepresentation, or Fraud condition of the Commercial Property Conditions Form? A. Any misrepresentation, even if it is immaterial, voids coverage. B. Concealment involves an active misstatement of fact. C. A misrepresentation is a passive failure to disclose a material fact. D. The commercial property coverage part voids coverage if the insured conceals a material fact pertaining to the covered property.
D. The commercial property coverage part voids coverage if the insured conceals a material fact pertaining to the covered property.
Which one of the following common policy conditions permits the insurer to verify property and business income values necessary for premium rating purposes? A. Examination of books and records B. Inspections and surveys C. Premiums D. Changes condition
A. Examination of books and records
Which one of the following statements is correct regarding the Spoilage Coverage endorsement to the Building and Personal Property Coverage Form? A. It covers damage to perishable stock resulting from on-premises breakdown, among other causes. B. The coverage is subject to coinsurance. C. The coverage is provided under a blanket limit. D. For coverage to apply to damage resulting from a power outage, the power outage must be caused by the insured.
A. It covers damage to perishable stock resulting from on-premises breakdown, among other causes.
Which one of the following best describes the Ordinance or Law Coverage endorsement to the Building and Personal Property Coverage Form's Coverage B? A. It covers the cost to demolish the undamaged portion of a building and remove its debris when demolition is required by the building code. B. It covers damage to perishable stock resulting from power outages. C. It covers the value of the undamaged portion of a building that must be demolished. D. It covers the cost to repair or rebuild the property resulting from the enforcement of a building, zoning, or land use law.
A. It covers the cost to demolish the undamaged portion of a building and remove its debris when demolition is required by the building code.
Which one of the following statements is the purpose of the No Benefit to Bailee condition of the Commercial Property Conditions Form? A. It reinforces the insurer's right of subrogation against the bailee. B. It allows bailees to limit their liability for others' property by using contractual provisions. C. It relieves bailees of liability for damage if the damage is recoverable under insurance carried by the bailor. D. It relieves bailees of liability to bailors for any damage to the property they hold.
A. It reinforces the insurer's right of subrogation against the bailee.
The limit of insurance applicable to commercial property coverage is an important component of the final premium because A. It represents the exposure against which the applicable rate is multiplied to calculate the premium. B. As the limit increases the risk of a total loss decreases, which results in some discounting of the final premium. C. Loss costs vary inversely with the limit of insurance. D. The rate changes when the amount of insurance is increased.
A. It represents the exposure against which the applicable rate is multiplied to calculate the premium.
Which one of the following is included in the Cancellation condition of the Common Policy Conditions of an ISO Commercial Package Policy? A. Notice of cancellation for nonpayment of premium must be mailed or delivered to the insured at least ten days before the date of cancellation. B. Any insured can cancel the coverage by calling his/her agent. C. In most states, policy conditions about cancellation supersede state laws that would otherwise apply. D. The insurer must give thirty days notice for cancellation for any reason
A. Notice of cancellation for nonpayment of premium must be mailed or delivered to the insured at least ten days before the date of cancellation.
Which one of the following statements is correct with respect to the Replacement Cost optional coverage of the Building and Personal Property Coverage Form (BPP)? A. The insurer is obligated to pay the cost to replace the damaged or destroyed property with new property of like kind and quality without any deduction for depreciation or obsolescence. B. Insurers underwrite the coverage carefully because some items that can be difficult to value, such as manuscripts, works of art, antiques, and rare articles, are covered for replacement cost. C. The insurer is obligated to pay replacement cost regardless of whether or not the property has actually been repaired or replaced. D. If the insured elects to accept an ACV claim settlement, the insured is barred from later requesting payment of replacement cost.
A. The insurer is obligated to pay the cost to replace the damaged or destroyed property with new property of like kind and quality without any deduction for depreciation or obsolescence.
Justin has a Commercial Package Policy (CPP) that has a Building and Personal Property Coverage Form (BPP) with a Causes of Loss—Broad Form covering his building with a $750,000 limit. A tropical storm struck Justin's building and the strong winds tore most of the shingles from the building's roof and shattered multiple windows on the 5th floor of the building. The rain from the storm caused water to enter Justin's building through the foundation, which caused significant damage to the first and second floors. Justin had equipment stored in closets on the first and second floors which were rendered inoperable due to the water damage. The total amount of damages was $40,000 for the windows and shingles; $110,000 for water damage to the first and second floors; $9,000 for the equipment on the second floor; and $7,000 for the equipment on the first floor. How much will Justin's insurer pay for damage to the first and second floors, including the equipment? A. The losses are not covered. B. $110,000 C. $126,000 D. $166,000
A. The losses are not covered.
Which one of the following statements is correct with respect to the condition Duties in the Event of Loss or Damage of the Building and Personal Property Coverage Form (BPP)? A. The insured is required to give the insurer notice of the loss, including a description of the property damaged, within 24 hours. B. If the insured fails to perform any of them, the insurer may not have to pay for the loss. C. To prevent insurance fraud, the insurer is obliged to notify the police of all losses reported. D. The claims adjuster is required to take all reasonable steps to protect the property from further loss, prepare an inventory and set the damaged property aside.
B. If the insured fails to perform any of them, the insurer may not have to pay for the loss.
Which one of the following is correct with respect to how the covered causes of loss affect commercial property insurance premiums? A. The rate for the Causes Of Loss—Basic Form consists of a Group II rate for fire, lightning, explosion, vandalism, and sprinkler leakage. B. If the policy provides Broad Form coverage, an additional rate is added to the Basic Form rates for the cost of covering the additional perils of the Broad Form. C. If the policy provides Broad Form coverage, a Group II rate is added for vandalism and sprinkler leakage. D. If the policy provides Special Form coverage, no additional rate is added to the Broad Form rates; instead a surcharge is added to the premium.
B. If the policy provides Broad Form coverage, an additional rate is added to the Basic Form rates for the cost of covering the additional perils of the Broad Form.
Which one of the following statements is correct with respect to the Control of Property condition of the Commercial Property Conditions Form? A. It states that a violation of a policy condition at one location will suspend coverage at all locations. B. It states that coverage under the policy will not be affected by acts or omissions of persons other than the insured, if the others are not acting under the direction or control of the insured. C. It requires the insured to give the insurer access to the premises in order to make inspections and to review the insured's accounting and other records. D. It prohibits the insured from abandoning damaged property to the insurer.
B. It states that coverage under the policy will not be affected by acts or omissions of persons other than the insured, if the others are not acting under the direction or control of the insured.
Which one of the following statements is correct with respect to the Insurance Under Two or More Coverages condition of the Commercial Property Conditions Form? Select one: A. It explains how to apportion the loss among multiple policies for the purpose of developing rates. B. It states that the total payment under all applicable coverage parts is limited to the actual amount of the loss. C. It is necessary because some property might be covered under two or more commercial package policies. D. It states that duplication, or "stacking," of the all applicable limits is allowed in the case of a loss.
B. It states that the total payment under all applicable coverage parts is limited to the actual amount of the loss.
One Common Policy Condition in the Commercial Package Policy (CPP) is the examination of books and records. The intent of this policy condition is to A. Protect the right of the insured to inspect the insured's premises. B. Reserve the right of an insurer to inspect and audit the insured's books and records. C. Ensure that the premium charged by the insurer has state approval. D. Prevent the insured from concealing hazardous conditions unacceptable to the insurer
B. Reserve the right of an insurer to inspect and audit the insured's books and records.
An insured chooses the "Agreed Value" option for its Building and Personal Property Coverage Form (BPP). The agreed value for the property is $100,000 and the limit of insurance is $120,000. The building is totally destroyed by a covered cause of loss. At the time of the loss, the value of the building was $130,000. Ignoring any deductible and rounded to the nearest $1,000, the insurer would pay A. $100,000. B. $108,000. C. $120,000. D. $130,000.
C. $120,000. The insurer will pay $120,000, the limit of insurance. Because the limit exceeds the agreed value, there is no penalty.
Agreed Value optional coverage is often elected by risk averse firms in order to A. Allow the firm to insure their building and contents for an amount greater than replacement cost. B. Waive any insurance to value requirements in most commercial leases. C. Alleviate the risk of not complying with the Coinsurance condition. D. Avoid the application of multiple deductibles in the event of several losses resulting from a single occurrence.
C. Alleviate the risk of not complying with the Coinsurance condition.
Which one of the following statements is correct regarding the Additional Covered Property endorsement to the Building and Personal Property Coverage Form, also referred to as the BPP? A. The current edition of the endorsement provides a limited list of the types of property that can be added under the endorsement. B. The endorsement provides coverage for the increased cost to repair or rebuild property resulting from the enforcement of a building, zoning, or land use law. C. Almost all types of property that are excluded in the BPP can be insured. D. For the most part, requests to add excluded items pose underwriting challenges for insurers.
C. Almost all types of property that are excluded in the BPP can be insured.
The Limited Coverage for Unmanned Aircraft (Scheduled and/or Blanket Coverage) endorsement Select one: A. Covers physical damage to the drone or related covered property if the drone is carrying or delivering goods or merchandise to others. B. Provides coverage when drones are used for racing, when drones are rented or loaned to others, and for damage to the drone caused by mechanical breakdown. C. Can be added to the Building and Personal Property Coverage Form and a few other commercial property coverage forms to cover physical loss to covered drones. D. Provides coverage only on a scheduled basis, with an individual limit of insurance for each drone.
C. Can be added to the Building and Personal Property Coverage Form and a few other commercial property coverage forms to cover physical loss to covered drones.
Omicron Incorporated is insured under an ISO commercial property policy and an ISO equipment breakdown policy. Both policies include the Other Insurance provision. In the case of a loss for which both policies provide coverage under the same plan, terms, and conditions, which one of the following statements is correct? A. The ISO commercial property policy becomes primary and the equipment breakdown policy becomes excess. B. Omicron can collect the full amount of the loss under both policies. C. Each policy pays in relation to all applicable policies. D. The policy that has been in force the longest becomes primary and the other policy becomes excess.
C. Each policy pays in relation to all applicable policies.
Which one of the following statements is correct? A. Sprinklered buildings are charged higher premiums than non-sprinklered buildings because of the risk of sprinkler leakage. B. Buildings that have certain fire hazards (such as unsafe heating or cooking devices or inadequate electrical wiring) are considered uninsurable. C. For rating purposes, external fire protection is graded on a scale of one to ten, indicating the availability of fire-fighting personnel and equipment. D. The presence or absence of internal fire protection systems has no effect on property insurance premiums.
C. For rating purposes, external fire protection is graded on a scale of one to ten, indicating the availability of fire-fighting personnel and equipment.
Insurers underwrite Agreed Value optional coverage carefully for which one of the following reasons? A. If the Agreed Value coverage option is not renewed, the coinsurance condition cannot be reinstated. B. Claims settlements under agreed value policies are typically higher than those under policies that include an 80 percent coinsurance clause. C. Insureds are often tempted to underinsure, knowing they will not suffer a coinsurance penalty when the agreed value option is in effect. D. The insurer is obliged to pay the ACV of the damaged property, regardless of the limit of insurance purchased.
C. Insureds are often tempted to underinsure, knowing they will not suffer a coinsurance penalty when the agreed value option is in effect.
Which one of the following statements is correct with regard to the Building and Personal Property Coverage Form (BPP)? A. Insureds cannot obtain any coverage under the BPP or its optional coverages for leased photocopiers, computers, phone systems, and other equipment. B. Under the extension of replacement cost to personal property of others, the amount of a loss is calculated according to a formula included in the additional coverage wording. C. Insureds who have selected the replacement cost option may also elect to have the personal property of others valued at replacement cost. D. If an insured extends replacement cost to the personal property of others, the amount of a loss is calculated as the replacement cost of that property, even if that amount exceeds the applicable limit of insurance.
C. Insureds who have selected the replacement cost option may also elect to have the personal property of others valued at replacement cost.
Under an ISO Commercial Package Policy, the insurer reserves the right to examine and audit the insured's books and records related to the policy at any time during the policy period and for up to how many years after the termination of the policy? A. One B. Two C. Three D. Four
C. Three
When an insured is choosing between replacement cost and actual cash value on a policy, the insured should A. Add actual cash value if it wants to waive the coinsurance condition. B. Choose replacement cost if it wants to include contents at the owner's residence. C. Evaluate the age of the building and, if it is over 50 years old, choose the replacement cost option. D. Determine if the policy limits is adequate for replacement cost.
D. Determine if the policy limits is adequate for replacement cost.
Which one of the following statements is correct with respect to the effect optional coverages of the Building and Personal Property Coverage Form (BPP) have on premiums? A. Adding optional coverages increases an insurer's policy processing costs and so an administration fee is charged. B. The charge for a coverage option always involves a separate additional rate applied to the amount of insurance. C. Replacement cost insurance requires a higher rate than ACV coverage. D. In some cases, the limit of insurance must be increased to cover the additional property values being insured.
D. In some cases, the limit of insurance must be increased to cover the additional property values being insured.
Which one of the following statements is correct with respect to deductibles used in commercial property policies? Select one: A. Because deductible amounts are generally small, they have no significant impact on loss costs and, therefore, do not affect property rates. B. Commercial property rates are developed with the assumption that the policy will be subject to a $5,000 deductible. C. Reducing a deductible from $500 to $250 represents too small a reduction in loss payments to generate any reduction in premiums. D. Rates are reduced in return for the insured's acceptance of a higher deductible.
D. Rates are reduced in return for the insured's acceptance of a higher deductible.
Which one of the following statements is correct with respect to coinsurance used with commercial property policies? Select one: A. When a policy requires a coinsurance percentage higher than 80 percent, the 80 percent coinsurance rate remains the same. B. When the coinsurance requirement is less than 80 percent, the rate is decreased. C. The rates ordinarily used for insuring buildings and personal property are calculated with the assumption that they will be used with a 100 percent coinsurance clause. D. The 80 percent coinsurance rate is reduced when a policy requires a higher coinsurance percentage.
D. The 80 percent coinsurance rate is reduced when a policy requires a higher coinsurance percentage.
Which one of the following is correct with respect to the Vacancy condition of the Building and Personal Property Coverage Form (BPP)? A. If the building has been vacant for more than one year, loss payments for all covered causes of loss are reduced by 50 percent. B. If the building has been vacant for more than ten consecutive days, the insurer will pay only for loss caused by vandalism. C. Buildings under construction or renovation are considered to be vacant. D. The conditions under which a building is considered to be vacant are different for a tenant than for an owner
D. The conditions under which a building is considered to be vacant are different for a tenant than for an owner
Which one of the following statements is correct with respect to the Recovered Property condition of the Building and Personal Property Coverage Form (BPP)? A. If property is recovered, the insured must accept the recovered property and refund the loss payment, less the cost of recovering and repairing the property, to the insurer. B. Recovered property is returned to the insured, who has no obligation to return the loss payment to the insurer. C. When property is recovered, the insurer need not notify the insured and may dispose of the property as it sees fit. D. The insured has the option of taking the recovered property and refunding the loss payment to the insurer
D. The insured has the option of taking the recovered property and refunding the loss payment to the insurer
Which one of the following statements is correct with respect to the Mortgageholder condition of the Building and Personal Property Coverage Form (BPP)? A. A mortgageholder is prohibited from paying any premium due, submitting a proof of loss, or notifying the insurer of any change in ownership or occupancy. B. If the insurer cancels or does not renew the policy it need not notify the mortgageholder. C. A loss payment check or draft is usually made payable to the insured who is then responsible for reimbursing the mortgageholder. D. The insurer is sometimes obligated to make a loss payment to the mortgageholder even though it has denied coverage, for example, to an insured who has committed arson.
D. The insurer is sometimes obligated to make a loss payment to the mortgageholder even though it has denied coverage, for example, to an insured who has committed arson.
Under the Legal Action Against Us condition of the Commercial Property Conditions Form, if the insured wishes to bring legal action against the insurer, he or she must do so within which one of the following timeframes? A. Sixty days after the insurer denies coverage for a loss B. One year from the date on which the insured notifies the insurer of his or her intention to sue C. Three years after the insurer's action that has given rise to the suit D. Two years after the date on which the direct physical loss occurred
D. Two years after the date on which the direct physical loss occurred
Which one of the following is correct with respect to the Transfer of Rights of Recovery Against Others to Us condition of the Commercial Property Conditions Form? A. Any waiver given by the insured, either before or after the loss, impairs the insured's right to collect from the insurer for the loss. B. The insured is prohibited from waiving recovery against any other party. C. Waiver of recovery against any other party may be given by the insured before or after the loss, provided the waiver is made in writing. D. Waiver of recovery against any other party may be given by the insured, provided the waiver is made in writing before the loss occurs
D. Waiver of recovery against any other party may be given by the insured, provided the waiver is made in writing before the loss occurs
