Property
Under a commercial property policy, all of the following are considered as real property and not as personal property
ladders, machinery bolted into the concrete floors, a building addition. all property used to service the premises meets the real property definition.
Moral Hazard
makes loss more likely because of the character of the insured
Coverage F of a homeowners policy, medical payments will pay which of the following injured parties
medical payments under coverage F is paid to people, other than an insured on a no-fault basis
What is the waiting period for flood insurance coverage when a current building owner decides to purchase it
must wait 30 days from the date the application has been made with the first premium payment included with the application.
wanton and willfull negligence
negligence when an insureds actions border upon almost being an intentional act
under a business owner policy is personal effects an optional coverage
no it is an extension of coverage under the BOP not an optional coverage
under a commercial property provisions loss or damage is only covered if it occurs in the coverage territory which includes
puerto rico, canada and USA
Property covered under a builders risk policy includes all of the following
Foundations, Partially completed structures, fixtures and machinery. IT DOES NOT INCLUDE bulding supplies intended to be made part of the structure being constructed must be within 100 FT of it's premises
which homeowner policy will pay loss to contents on an per perils basis
HO5 as the comprehensive coverage covers loss to both the dwelling and contents on an open paril basis
Homeowner policy that is not named perils coverage
HO5 the comprehensive coverage is open perils
Usually the owner of a single family home will select which policy
Homeowners policy
Property policy cancellation
If insured cancels policy they are entitled to all money not yet paid by the insured is refunded but is a short rate refund
Insurance
Insurance is a risk transfer in which the insurer provides coverage in exchange for premiums
Fire department service charge Maximum in a builders risk policy is
$1,000
What is the maximum dollar amount that can be collected to restore valuable papers by a business owner policy?
$10,000 are available under the personal property extension of valuable papers and records coverage to cover the cost of research and other reproduction cost. The limit is only $5000 if the papers that require restoring are not at the described premises.
Commercial building & business personal property form covers detach signs stored out in the open but within 100 feet of the premises up to
$1000
in a H03 what could the maximumloss payment be if coverage A is 150,000 and the dwelling, a detached garage and all of the personal property of the insured is a total loss?
$240,000 coverage A + coverage B plus coverage C is paid in the event of a covered loss. Coverage B is 10% and coverage C is 50% of the coverage A amount. $150,000 plus $15,000. (Coverage B at 10%) + $75,000 ( Coverage C at 50%) = $240,000
What is the standard deductible for a business owner policy?
$500
On what basis does the business owner policy cover liability loss
Liability is covered under a BOP on an per ocurrence basis
Boats of what length require Yacht coverage?
Longer than 26 feet
which items of personal property are not excluded under coverage C of the dwellimg program
Manuscripts are covered under coverage C for up to $1500 along with other valuable papers, such as securities, accounts and deeds
medical payment coverage in the section II under a business owner policy is
goodwill coverage and liability does not need to be established for the policy to pay
Law of large numbers
helps make risk more predictable for an insurer
Liability
A person who is responsible for unintentional, ask, that may cause death, or harm to a person or property
What is the best insurance for an owner-occupier of a single family home
homeowner policy
In a commercial package policy what is the only risk class that is not eligible for coverage
homeowners
According to the conditions of the homeowners policy, the insured must submit a signed proof of loss form to the insurance company within
60 days of the insurance company request to submit it
Pure risk
A chance of loss or no loss, but no chance of gain.
all risk basis
Any further damage from any cause of loss
N owns three homes in two different states. If N wanted to have one policy that covers all of the properties, N should buy:
Blanket coverage as is more than 1 property at one or more locations under one contract
if property is removed to protect it from further damage, what coverage is provided according to additional coverages in section I
Coverage is provided for up to 30 days from ghe move on an all risk basis ( any further damage from any cause of loss)
what is business income coverage?
Business income coverage is a type of Indirect coverage for loss That is a consequence of loss which is direct but is not direct loss itself.
Small to medium size businesses is well served by
Business owner policy ( BOP )
A larger business with varied property and casualty insurance needs is likely to be best served by what insurance type
Commercial Package Policy
Basi form is also known as the
DP1
What form of dwelling covers the least
DP1
Broad Form is also known as the
DP2
Special Form is also known as the
DP3
What form of dwelling covers the most
DP3
Most expensive to least expensive premiums of dwelling
DP3 , DP2 , DP1
The formula to apply a coinsurance/insurance to value clause is
Divide the amount of actual insurance into the required amount of insurance and then multiply that by the loss amount
The four elements in a court law to prove negligence are
Duty, Breach of duty, actual injury, establishing proximate cause
Dwelling program coverages included in the basic form
Dwelling, Fair Rental, Other Structures. What is not included is additional living expenses or increased living expenses coverage that would need to be added by endorsement to the basic form
Obligations of the Insurance Company
Must be fair in underwriting, and pay all covered losses in a timely manner
Under the NFIP which of the following is the longer coverage binder allowed
No binders are allowed or available under the flood program
Does coverage A in a dwelling policy cover any damage or loss to the land itself
No it does not pay for any loss sustained to the land itself
Is personal property loss covered under a commercial building and business personal property ?
No it needs to be added on as an endoresement or as additional coverage
Binder
Temporary coverage that are given by agents to provide a media coverage pending future issuance of a policy
Specified peril
Only covers losses if they are specifically listed in the contract for coverage
what is the maximum payroll for a business owner policy for contractors such as painters, electricians, drywaller's, carpenters etc
Payroll cannot exceed $300,000
Duties of the insured provision
Prevent further loss, Provide immediate notice of loss and provide all statements and paperwork that would help with claim
The clause that pays up to $500 if the insured moves their mobile home out of harms way is called
Property Removed
How much coverage does coverage B provide for other structures
Provides up to 10% of the dwelling coverage amount in additional to the amount paid under coverage A
A builders risk policy is in effect while construction is taking place as long as a project has not been abandoned.
True
A saleswoman who shows customers actual product on sales calls needs a salespersons' sample floater
True
Federal law says you must own flood insurance for eligibility to receive national disaster relief benefits
True
Medical equipment that moves from side to side is covered by a physicians and surgeons equipment floater
True
Non owned detached trailers used by the insured that are in their care, custody and control are insured up to a maximum of $5,000
True
True or False The business owner policy pays business income loss during the period of restoration for up to 12 months without a dollar limit after 72 hours waiting period and payroll is limited to a 60 day.
True
True or false to be covered flooding must occur as a general condition of an area
True
additional coverage of section II of a homeowners policy offers up to $1000 for the insured's share of a loss assessment as a member of a group of property owners
True
if accounts receivables records are destroyed coverage under the account receivable floater would apply?
True
when the owner of large construction equipment sends it from worksite to worksite a contractors equipment floater covers potential losses
True
burglary
is a forcible entry or exit into or out of an insureds lock premises with felonious intent
What leads to termination of a builders risk policy?
The coverages over when the policy expires or coverage terminates automatically if the builder abandons construction and has no intention to return to finish the job or the coverage, and when the building that was constructed, it's accepted by the purchaser
Will special form pay for a loss cause accidentally by the insurer to their own personal property
Yes they will pay for that loss. In a HO3 policy as well as an HO5 policy they pay for losses cause accidently by the insurer to their own personal property
Under mortgagee rights
The lender gets advance, written notice of policy cancellation
Subrogation
The process by which an insurer can, after it has paid a loss under the policy, recover the amount paid from any party (other than the insured) who caused the loss or is otherwise legally liable for the loss.
The main goal of extra expense coverage is to
The purpose of extra expense insurance is to allow a business that has suffered a direct loss to continue normal business operation with little or no downtime due to the direct loss suffered
Which of the following homeowners forms will cover structures on an open peril basis, but will cover personal property on a named peril basis
The special form HO3 covers only the dwelling and detached structures on a named perils basis while the contents are covered by the broad form perils found in HO2
Risk
The uncertainty or chance of a loss occurring.
NFIP Deductibles
There is a deductible applied to the building and another to the contents under both the emergency and regular programs
J owns a business and hires V to build the structure. When does J have the financial responsibility for the structure that V is building
When J accepts the property from V
What is the fire department service charge amount paid by a homeowners policy
When fire department service charges are valid the homeowners policy will pay up to $500 without the requirement of a deductible
Is additional and increased expenses coverage included in Broad and Special form
Yes
is money, coins, precious metals and bank notes covered under coverage C
Yes as it is personal property and it is covered for up to $200 under coverage C
Are businesses allowed in a single family house insured by a dwelling policy
Yes as long as it is not incidental
Does earthquake coverage need to be added on as an endorsement to the commercial building and business personal property?
Yes because it is not a form of coverage that is available under a commercial building and business personal property policy
Will a homeowner that has an HO3 policy with no endorsements cover an earth movement that causes the gas pipe in his house to split and an ensuing fire burns down the home
Yes direct loss caused by fire, explosion or theft caused by the earthquake, including mudslides, landslides, mine subsidence, and sinkhole, and any other land movement, or shifting is covered
Does coverage E in a homeowners policy, cover bodily injury and property damage arising out of the negligent acts of the insured
Yes it does it is not excluded from the policy
Does tenant broad form offer personal property and loss of use coverage
Yes it does it just doesn't offer dwelling or other detached structures coverage
In a HO6 homeowners policy in Coverage C is Content loss paid as ACV?
Yes since there is minimal to no coverage A in the condo policy ( HO6 ) personal property is insured on a stated value basis and loss is paid as actual cash value and not a replacement cost
if an insured drops an expensive couch and destroys it while moving it to do some painting in their home. will this be covered under an HO5 policy?
Yes the comprehensive form insurance, both the dwelling and contents on an open peril basis and if an insured damages their own personal property accidentally it is covered because it is not excluded
Vicarious Liability
employee/employer when one person is legally responsible for the actions of another individual
what structure is not eligible for a dwelling property policy
farm house they need be insured under a farm policy
For the equipment breakdown policy, which of the following would not need the definition of breakdown
a leaking valve. breakdown does not mean or include leakage at any valve, fitting, shaft seal, gland packing, joint, or connection.
Additional insured
a person or party who is added to the named insured's policy by an endorsement
Physical Hazard
a physical condition that increases the chance of loss
A Warranty is defined as
a sworn statement of truth, guaranteed to be true.
Absolute Liability
an insured has a hazardous condition, present, such as harboring, a wild animal, or having a swimming pool there is no negligence to be proven to establish who is responsible for loss
The commercial building and business personal property form includes the following coverages
buildings permanently affixed to the land or furniture owned and used by the business or personal property of others in the care of the insured or anything located inside of an insureds business buildings
Morale Hazard
carelessness or indifference to a loss because of the existence of insurance
J has a policy and wants to know what his rights and duties of the policy will be and what duties and rights the insurer has. J should read the
conditions
Coverage A in a dwelling policy provides all of the following coverages
covers all structures attached to the dwelling and it covers any supplies or materials in the dwelling intended to be used for construction and also covers any supplies or materials in the dwelling intended to be used for repair of the dwelling
When is a commercial package policy needed?
for larger company's or businesses to suit all of their business needs. NOT small to medium businesses
The federal emergency management agency
sets the flood control measures that must be adopted for eligibility for flood insurance
Which of the following homeowners coverage forms will pay for loss caused accidentally by the insured to their own personal property
special form and it is covered on an HO3 and HO5 policy
what is the main purpose of the national flood insurance program NFIP
to make flood insurance available to businesses and individuals, who otherwise would be unable to procure such coverage
An unoccupancy is a contract provision that can be defined as a structure
without people but with contents
A vacancy is a contract provision that can bd defined as a structure
without people or contents
