CIC Property Exam Questions with Complete Solutions

Business Income Co-Insurance Formula - Answer-Co-insurance x {net income + operating expenses (that would have been earned or incurred for the 12 months following the inception date)} Differentiate between ACV and Replacement Cost - Answer-ACV = Replacement cost less depreciation of damaged or stolen property at the time of a loss. Replacement cost = Cost to replace the property with property of like, kind, & quality with no deduction for depreciation. Name the coverage extensions in the Building and Personal Property Coverage Form - Answer-Newly acquired or constructed property - Bldgs $250,000 (must be built on the premises or acquired at other location for the similar use or warehouse) BPP $100,000; BPP temporarily in portable storage units $10,000 (must be within 100 feet of described premises for max of 90 days); Non-owned detached trailers $5,000 (trailer must be in insured's care custody & control, must be contractual responsibility to pay for loss or damage to the trailer; Valuable papers and records $2,500 (no electronic data and only for named causes of loss); Outdoor property (outdoor fences, radio & TV antennas, trees, shrubs & plants) $1,000 but no more than $250 for any one tree, shrub or plant); Property of Others $2500 (no theft cov for employees, owners, officers, partners); Property off premises $10,000 (temp at location not owned, leased or rented by insd) Name the additional coverages in the Building and Personal Property Coverage Form - Answer-Fire Dept Service Charge $1,000; Increased Cost of Construction $10,000 or 5% of the loss whichever is less; Preservation of property 30 days; Pollutant clean up $10,000 (premise only); EDP $2,500; Debris Removal 25% of paid loss plus $25,000 if debris removal costs exceed 25% of the paid loss Windstorm or Hail Percentage Deductible (CP 03 21) - Answer-Choose 1%, 2% or 5% of the Limit of Insurance for the deductible for wind and hail Multiple Deductible Form (CP 03 20) - Answer-Allows the selection of different deductibles by location and cause of loss Named Storm Percentage Deductible (CP 03 25) - Answer-Choose 1%, 2%, or 5% of the Limit of Insurance for the deductible for a storm named by the National Hurricane Center or Central Pacific Hurricane Center of the National Weather Service. Deductible applies separately to each building and to each BPP location. Additional Covered Property (CP 14 10) - Answer-Modifies Building and Personal Property Coverage Form CP 00 10 to add back certain excluded property