Dwelling Policy Practice Questions And
Answers Latest Update | Solved
Which statement concerning the Dwelling Special Form is true?
a. Contents are provided Open Perils coverage on an Actual Cash Value basis
b. Contents are provided Open Perils coverage on a Replacement Cost basis
c. Coverages A through D are provided Open Perils coverage on an Actual Cash Value
basis
d. The Dwelling and other structures are provided Open Perils coverage on a
Replacement Cost basis CORRECT ANSWERS D. The Dwelling and other structures
are provided Open Perils coverage on a Replacement Cost basis
Explanation
Under the Special Form, the dwelling and other structures are covered against open
perils on a replacement cost basis, while personal property is covered against the broad
perils on an actual cash value basis.
Under the Basic Dwelling Form, is damage caused by vandalism automatically
included?
a. It is included in the Extended Coverage Perils
b. It is not available in the Basic Dwelling Policy
c. No, it must be added by endorsement
d. It is included as Basic Peril CORRECT ANSWERS C. No, it must be added by
endorsement
Explanation
The Basic Dwelling Form is designed to provide coverage at a minimum cost. If the
insured desires vandalism coverage, attaching a Vandalism Coverage endorsement
and charging a premium for the endorsement provides it.
Which statement is true concerning dwelling policies?
a. 100% of Coverage C applies to worldwide coverage
b. The Special Form automatically covers the contents against the peril of theft
c. The Special Form insures the dwelling on an open perils basis, and insures the
contents against the broad form perils
d. The Basic Form pays for losses to the dwelling on a replacement cost basis
CORRECT ANSWERS C. The Special Form insures the dwelling on an open perils
basis, and insures the contents against the broad form perils
Explanation
The Special Form insures the dwelling on an open perils basis, and insures the contents
against the broad form perils. Theft is excluded. The Basic Form settles losses to the
dwelling on an ACV basis. Up to 10% of the Coverage C limit may be applied to
covered property anywhere in the world.
, Which of the following is true regarding the Personal Liability Supplement?
a. It provides coverage for claim expenses, first aid expenses and damage to property
of others
b. It covers the insured's personal auto
c. It covers Professional Services rendered by the insured
d. The Limit of Liability is the same as the Coverage A amount CORRECT ANSWERS
A. It provides coverage for claim expenses, first aid expenses and damage to property
of others
Explanation
The Claim Expenses, First Aid Expenses, and Damage to Property of Others are
Additional Coverages that supplement Coverage L, Personal Liability, and Coverage M,
Medical Payments.
Under Dwelling Policies, which of the following require the policy to be written to at least
80% of the full replacement cost of the dwelling at the time of loss to provide
replacement cost coverage?
a. The DP-1 and the DP-2
b. The DP-2 and the DP-3
c. The DP-1
d. The DP-4 CORRECT ANSWERS B. The DP-2 and the DP-3
Explanation
The DP-2 (Broad) and DP-3 (Special) Dwelling policies provide replacement cost
coverage, provided, that the insured insures the property to at least 80% of its
replacement cost. The DP-1 (Basic) provides only Actual Cash Value coverage.
Which is correct regarding the Automatic Increase in Insurance Endorsement?
a. The endorsement does not apply if the Coverage Limits are otherwise adjusted
during the policy term
b. The adjustment is made to the deductible, as well as to the limit of insurance
c. The endorsement applies to Coverages A, B, and C
d. The endorsement will automatically raise the limits of insurance at periodic intervals
CORRECT ANSWERS D. The endorsement will automatically raise the limits of
insurance at periodic intervals
Explanation
The function of the Automatic Increase in Insurance endorsement is to protect
adequately the insured when the property increases in value because of inflation.
All of the following perils are included under the Dwelling Broad Form, except:
a. Smoke damage from industrial operations
b. Falling Objects
c. Volcanic Eruption
Answers Latest Update | Solved
Which statement concerning the Dwelling Special Form is true?
a. Contents are provided Open Perils coverage on an Actual Cash Value basis
b. Contents are provided Open Perils coverage on a Replacement Cost basis
c. Coverages A through D are provided Open Perils coverage on an Actual Cash Value
basis
d. The Dwelling and other structures are provided Open Perils coverage on a
Replacement Cost basis CORRECT ANSWERS D. The Dwelling and other structures
are provided Open Perils coverage on a Replacement Cost basis
Explanation
Under the Special Form, the dwelling and other structures are covered against open
perils on a replacement cost basis, while personal property is covered against the broad
perils on an actual cash value basis.
Under the Basic Dwelling Form, is damage caused by vandalism automatically
included?
a. It is included in the Extended Coverage Perils
b. It is not available in the Basic Dwelling Policy
c. No, it must be added by endorsement
d. It is included as Basic Peril CORRECT ANSWERS C. No, it must be added by
endorsement
Explanation
The Basic Dwelling Form is designed to provide coverage at a minimum cost. If the
insured desires vandalism coverage, attaching a Vandalism Coverage endorsement
and charging a premium for the endorsement provides it.
Which statement is true concerning dwelling policies?
a. 100% of Coverage C applies to worldwide coverage
b. The Special Form automatically covers the contents against the peril of theft
c. The Special Form insures the dwelling on an open perils basis, and insures the
contents against the broad form perils
d. The Basic Form pays for losses to the dwelling on a replacement cost basis
CORRECT ANSWERS C. The Special Form insures the dwelling on an open perils
basis, and insures the contents against the broad form perils
Explanation
The Special Form insures the dwelling on an open perils basis, and insures the contents
against the broad form perils. Theft is excluded. The Basic Form settles losses to the
dwelling on an ACV basis. Up to 10% of the Coverage C limit may be applied to
covered property anywhere in the world.
, Which of the following is true regarding the Personal Liability Supplement?
a. It provides coverage for claim expenses, first aid expenses and damage to property
of others
b. It covers the insured's personal auto
c. It covers Professional Services rendered by the insured
d. The Limit of Liability is the same as the Coverage A amount CORRECT ANSWERS
A. It provides coverage for claim expenses, first aid expenses and damage to property
of others
Explanation
The Claim Expenses, First Aid Expenses, and Damage to Property of Others are
Additional Coverages that supplement Coverage L, Personal Liability, and Coverage M,
Medical Payments.
Under Dwelling Policies, which of the following require the policy to be written to at least
80% of the full replacement cost of the dwelling at the time of loss to provide
replacement cost coverage?
a. The DP-1 and the DP-2
b. The DP-2 and the DP-3
c. The DP-1
d. The DP-4 CORRECT ANSWERS B. The DP-2 and the DP-3
Explanation
The DP-2 (Broad) and DP-3 (Special) Dwelling policies provide replacement cost
coverage, provided, that the insured insures the property to at least 80% of its
replacement cost. The DP-1 (Basic) provides only Actual Cash Value coverage.
Which is correct regarding the Automatic Increase in Insurance Endorsement?
a. The endorsement does not apply if the Coverage Limits are otherwise adjusted
during the policy term
b. The adjustment is made to the deductible, as well as to the limit of insurance
c. The endorsement applies to Coverages A, B, and C
d. The endorsement will automatically raise the limits of insurance at periodic intervals
CORRECT ANSWERS D. The endorsement will automatically raise the limits of
insurance at periodic intervals
Explanation
The function of the Automatic Increase in Insurance endorsement is to protect
adequately the insured when the property increases in value because of inflation.
All of the following perils are included under the Dwelling Broad Form, except:
a. Smoke damage from industrial operations
b. Falling Objects
c. Volcanic Eruption
