PROPERTY AND CASUALTY - TYPES OF PROPERTY POLICIES EXAM PREP QUESTIONS AND ANSWERS

What type of policy consists of the declarations, conditions, endorsements, and other attachments applicable to a single line of insurance? Monoline What are the coverage parts that may be included in a Commercial Package Policy (CPP) Commercial property, general liability, crime, equipment breakdown, auto, inland marine, and farm When can an insured cancel a Businessowners policy? At any time by mailing a written notice of cancellation When other insurance is written on the same basis as a Commercial Property Policy, what is the insurer obligated to cover? A share of the loss If 3 volcanic eruptions happen within 48 hours, and each contributes to property damage, how many deductibles will apply in the dwelling policy? 1 deductible (all instance of volcanic eruptions that occur within a 72-hour period are considered 1 occurrence) Losses caused by vandalism and malicious mischief are excluded from coverage if a dwelling has been vacant for how many days? 60 Days Assuming the insurer and the insured agree on the amount payable for a loss covered under a dwelling policy, how soon after recieving the proof of loss must the insurer pay the claim? 60 Days What is mysterious disappearance? Misplacement or loss of property without knowledge as to the location, time and cause of the loss. What is the purpose of the National Flood Insurance Program (NFIP) To the gap in flood coverage left by private insurers A businessowners policy is sold as a package. What does that mean? Coverage includes both property and liability What is the maximum number of units in residential dwellings insured by a Dwelling Policy? Up to 4 units What type of policy is a businessowners policy? Prepackaged, stand-alone policy In order for forms HO-2, HO-3, and HO-5 to provide coverage, a dwelling must be insured for at least what percentage of replacement cost? 80% How many owner-occupied residences per covered home are allowed by homeowners policies? An HO policy may insure a property that has 1 - to 4 - family owner occupied residences What do dwelling policies insure? Dwelling only, contents only, or both dwelling and contents What Homeowners policy form is known as a special form? HO-3 special form What is the name for policy endorsements that may apply to more than one coverage part? Interline endorsements IN dwelling policies, any volcanic activity will be considered part of one occurrence if it all happens within how many hours? 72 hours Which dwelling form provides open peril coverage on the building? DP-3 (Special) What HO form covers a historic home with replacement cost more than the market value? HO-8 (modified homeowners) What would be considered a single accident in Equipment Breakdown coverage? All accidents at a single location, at the same time, by the same cause In dwelling policies, within how many years of a loss may an insured bring a lawsuit against the insurer? 2 years Under Coverage C - Personal Property in the dwelling policy, when will a guest's property be covered? Only when the property is at the insured location In Commercial Inland Marine policies, who transports the property of anyone who hires them? Common Carriers What some of the exclusions from coverage in all of the homeowners forms? Land, structures used for business purposes, animals/birds/fish, aircraft, rented property, electronic data, and motor vehicles. What type of property can be covered under Inland Marine Insurance? Any type of property that is portable on land, as well as means of transportation and communication A basic dwelling policy automatically provides coverage against what? Fire, lightning and internal explosion What components make up a Commercial Policy? Policy cover; policy declarations; interlines endorsements; lines of insurance declaration pages; lines of insurance coverage forms; common policy conditions; lines of insurance conditions; causes of loss forms; and endorsements When will damage to the interior of the building be covered under the falling objects peril in the broad form of the dwelling policy? Only if the interior damage is a direct result of exterior damage from a falling object What is the limit that the insurer will pay for all losses that occur during a policy period? Aggregate limit When a dwelling policy is cancelled for nonpayment of premium, the insurer must give notice within how many days of the cancellation? 10 days Replacement cost coverage is provided in both broad and special form dwelling policies when the amount of insurance on the dwelling is what percentage? At least 80% of the replacement cost