ExamFX : Types of Property Policies Chapter Questions With Complete Solutions

Dwelling ('02) Policy correct answer: Is used to insure 1-4 unit residential dwellings that are not eligible for coverage under the regular homeowners program because of age, location, value, or other factors. 3 Coverage Forms (Dwelling Program) correct answer: 1.DP 00 01- Basic 2.DP 00 02-Broad 3.DP 00 03-Special Basic Form correct answer: Is a named peril coverage form and provides the most limited coverage of the 3 forms. Losses under this form will be paid on ACV basis. Basic Form Insures Against correct answer: 1. Fire 2.Lightning 3.Internal Explosion 4. Windstorm or Hail 5.Explosion 6.Smoke- Loss or damage 7.Aircraft and vehicles- loss or damage 8.Riot or civil commotion 9.Volcanic Eruption WHARVES correct answer: Can be used to remember extended coverage perils: Windstorm Hail Aircraft/vehicle Riot/civil commotion Volcanic eruption Explosion Smoke W.C SHAVER correct answer: Can be used to remember extended coverage perils: Windstorm, Civil commotion ,Smoke Hail, Aircraft, Vehicle and volcano, Explosion and Riots. Vandalism and Malicious Mischief (VMM) correct answer: Protects property against damage or loss caused by vandals. May be added by Endorsement to the DP-1 Basic Form; included coverage in many other Property forms. There is no coverage if proceeding the loss , the insureds premisies have been vacant for more than 60 consecutive days under (DP '02) Broad Form correct answer: Losses to the dwelling are covered on a replacement cost basis as long as the insured maintains a minimum amount of coverage equal to 80% of the dwelling replacement cost. This form expands the cause of loss insured under the basic form. There are 7 additional perils insured in the broad form-extended coverage perils, vandalism and malicious mischief. Broad Form Insures Against correct answer: All Basic Form Perils + 1.Burglary damage 2.Falling Objects- Loss or Damage 3.Weight of Ice, Snow, Sleet- Loss or Damage 4.Tearing apart, cracking, burning, or bulging 5.Accidental Discharge or Overflow of water or Steam 6.Freezing of Plumbing