Commercial Property Insurance

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

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

With Commercial Property insurance, how would the insured receive replacement cost loss settlement on damage (as a result of a covered peril) to the Personal Property of Others left in the insured's care custody and control? A. Request a separate replacement cost endorsement on the Personal Property of Others coverage on the policy, B. Request the Replacement Cost endorsement on Business Personal Property C. Insure the Property of Others for at least 100% of the cost to replace it. D. Send in periodic reports to the insurer on the value of the property of others left in the insured's care custody and control

A. Even if the Replacement Cost endorsement is attached to the Building and Business Personal Property coverage, a separate endorsement is necessary for replacement cost settlement on the property of others left in the insured's care custody and control.

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 Property 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 revised Commercial Property forms is: A. $500 B. $1,000 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 loss as the result of a cracked steam boiler. 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, custody and control C. Land D. Patios or other paved surfaces

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

Under the Condominium Association form, coverage is based on: A. The Commercial Property form B. The association agreement and bylaws C. The Special Cause of Loss form D. State and local ordinances

B. The coverage provided by the form will be based on the condominium association agreement and by-laws.

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 consecutive weeks C. Four consecutive weeks D. Three consecutive weeks

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

Before legal action may be taken against an insurer, an insured must have complied with all terms of the policy. Any legal action must begin within ____ following a loss. A. 6 months B. 5 years C. 2 years D. 12 months

C. Any legal action must begin within two years.

What is generally excluded on the Condominium Commercial Unit-Owners form? A. The improvements and betterments of the unit-owner B. Hostile fire damage C. Building coverage D. Inside appliances and fixtures

C. Building coverage is generally excluded on the Condominium Commercial Unit-Owners form.

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".

Volcanic action is covered under which of the following Cause of Loss forms? 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 Cause of Loss forms? 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 Cause of Loss forms? 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 covered property under a 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 correct as to what is paid under Extra Expense coverage.

The Earthquake and Volcanic Eruption endorsement provides coverage: A. Against earthquake from volcanic eruption B. For commercial buildings and other covered property when used in conjunction with another Cause of Loss forms 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 Form Cause of Loss excludes all of the following, except: A. Loss of market. B. Loss due to artificially generated electric current. C. Agricultural smudging. D. All of these are exclusions.

D. All of the responses are exclusions.

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

D. All of these are included under coverage for "business personal property."

Under the Commercial Building and Personal Property form, coverage for the "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 included as part of "building" coverage.

If both the Condominium Association form and the Condominium Unit-Owner form cover the same property, how will the loss be handled? A. Each policy will pay pro-rata B. The Association policy will be excess over the Unit-Owners C. Each policy will share equally in the loss D. The Unit-Owners policy will be excess over the Association policy

D. If both policies cover the same property, the Unit-Owners form will be excess over the Association form.

Which of the following 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 coverage must be purchased separately under a separate program.

Which of the following losses to perishable stock would be covered by the Spoilage Endorsement? A. Power outage B. Mechanical breakdown or contamination C. Changes in temperature, humidity, or contamination resulting from a power outage on or off the premises D. All of the above

D. The Spoilage endorsement would cover loss to perishable stock caused by all of these situations.

A building valued at $100,000 was insured for $80,000 with a policy containing 80% Coinsurance clause. 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.