1
State Farm Fire Independent Policy
Exam Questions and Correct Answers
Select the false statement listed below: In the HO-3
policy, the ALE payments will be made only for:
Select the single best answer:
A. The shortest time necessary to repair or replace the
damaged property, but not to exceed 24 months.
B. If the insured does not rebuild, the time necessary
for the insured to relocate in permanent living quarters,
but not to exceed 24 months.
C. ALE payments can run beyond the expiration of the
policy.
D. ALE payments are limited to incurred costs for the
shorte Answer: E. ALE payments will not exceed 20%
of Coverage A limits.
Pretest - Stuvia US
,2
The insured has a HO-3 policy in force. All of the losses
are covered except:
Select the single best answer:
A. Shed rented to a tenant, to store furniture
B. Detached garage used to operate a lawnmower
repair shop
C. Garage rented to the neighbor to store an antique
automobile
D. Basement used as an office for insured's
bookkeeping business
E. Garage (attached) rented to tenant to store fishing
boat Answer: B. Detached garage used to operate a
lawnmower repair shop
Pretest - Stuvia US
,3
Jennifer Marco has a HO-3 policy, with a Coverage B
limit of $75,000, a $500 deductible, and no Option AI,
ID, FA or JF. Which of the following statements is true
concerning her personal property?
Select the single best answer:
A. Coverage for personal property applies for perils
listed under Section I - Losses Insured, Coverage B -
Personal Property and Section I - Additional Coverages.
B. Coverage B applies only for items Jennifer owns,
while anywhere in the world.
C. The limit of liability Answer: A. Coverage for
personal property applies for perils listed under Section
I - Losses Insured, Coverage B - Personal Property and
Section I - Additional Coverages.
Under an HO-3 policy, deductibles apply to which of the
following type(s) of losses.
Pretest - Stuvia US
, 4
Select the single best answer:
A. Credit Card, Bank Fund Transfer Card, Forgery and
Counterfeit Money
B. Fire Department Service Charges
C. Rekey locks after keys are stolen
D. Debris Removal Charges Answer: B. Fire
Department Service Charges
In the HO-3 policy, Coverage C consists of three
coverages:
Additional Living Expense
Fair Rental Value
Property Removed
Pretest - Stuvia US
State Farm Fire Independent Policy
Exam Questions and Correct Answers
Select the false statement listed below: In the HO-3
policy, the ALE payments will be made only for:
Select the single best answer:
A. The shortest time necessary to repair or replace the
damaged property, but not to exceed 24 months.
B. If the insured does not rebuild, the time necessary
for the insured to relocate in permanent living quarters,
but not to exceed 24 months.
C. ALE payments can run beyond the expiration of the
policy.
D. ALE payments are limited to incurred costs for the
shorte Answer: E. ALE payments will not exceed 20%
of Coverage A limits.
Pretest - Stuvia US
,2
The insured has a HO-3 policy in force. All of the losses
are covered except:
Select the single best answer:
A. Shed rented to a tenant, to store furniture
B. Detached garage used to operate a lawnmower
repair shop
C. Garage rented to the neighbor to store an antique
automobile
D. Basement used as an office for insured's
bookkeeping business
E. Garage (attached) rented to tenant to store fishing
boat Answer: B. Detached garage used to operate a
lawnmower repair shop
Pretest - Stuvia US
,3
Jennifer Marco has a HO-3 policy, with a Coverage B
limit of $75,000, a $500 deductible, and no Option AI,
ID, FA or JF. Which of the following statements is true
concerning her personal property?
Select the single best answer:
A. Coverage for personal property applies for perils
listed under Section I - Losses Insured, Coverage B -
Personal Property and Section I - Additional Coverages.
B. Coverage B applies only for items Jennifer owns,
while anywhere in the world.
C. The limit of liability Answer: A. Coverage for
personal property applies for perils listed under Section
I - Losses Insured, Coverage B - Personal Property and
Section I - Additional Coverages.
Under an HO-3 policy, deductibles apply to which of the
following type(s) of losses.
Pretest - Stuvia US
, 4
Select the single best answer:
A. Credit Card, Bank Fund Transfer Card, Forgery and
Counterfeit Money
B. Fire Department Service Charges
C. Rekey locks after keys are stolen
D. Debris Removal Charges Answer: B. Fire
Department Service Charges
In the HO-3 policy, Coverage C consists of three
coverages:
Additional Living Expense
Fair Rental Value
Property Removed
Pretest - Stuvia US
