BOP Insurance Questions with Correct Answers

All are true about a BOP EXCEPT: Correct Answer Answer: 100% coinsurance is required True: Vandalism is not covered after 60 days vacancy,Liability coverage is excess over any other insurance that applies,Advance notice must be sent on cancellation or non-renewal Explanation: The BOP does contain replacement cost coverage, but with an 80% coinsurance requirement. The policy contains an automatic inflation guard feature, so coinsurance penalties are rare. On a BOP, hired and non-owned auto coverage applies when: Correct Answer Answer: An employee damages property of others while operating a non-owned car Explanation: Although the liability section of a BOP (which is a CGL) does not provide auto liability for owned autos, the insured may be concerned about liability that may result when an employee drives a non-owned or hired car on company business. To solve this problem, they can add an endorsement known as hired and non-owned auto coverage. All are true about an unendorsed BOP EXCEPT: Correct Answer Answer: It is named perils Explanation: The BOP is all-risk. All of the following are true regarding medical coverage on a BOP EXCEPT: Correct Answer Answer: It covers injury to the named insured and employees Explanation: Like an HO, medical coverage on the liability section of a BOP is to others, not to the insured or to employees, who are required to be covered under workers' compensation. The standard deductible on a BOP is: Correct Answer Answer: $500 Explanation: Although the standard deductible on a BOP is $500, insureds may choose deductibles of either $250, $1,000 or $2,500. The higher the deductible, the lower the premium. Which of the following small businesses would be eligible for a BOP? Correct Answer Answer: A retail store