CIC COMMERCIAL PROPERTY EXAMINATION TEST
QUESTIONS AND SOLUTIONS 2025/2026 RATED A+
✔✔Additional property not covered endorsement CP 14 20 11 91 - ✔✔this is similar to
the additional property not covered endorsement for property, insured or insurer can
elect to list specific BPP that isn't covered
✔✔Leased property endorsement- CP 14 60 07 88 - ✔✔This is used to categorize
business personal property leased to the named insured as your business personal
property rather that categorizing it as personal property of others
✔✔Your business personal property- separation of coverage CP 19 10 06 95 - ✔✔this
endorsement can separate out and specify a limit of your insurance for any of the seven
categories of your business personal property. The your business property limit will now
not apply to the BPP that was separated and specifically listed
-commonly used for improvements and betterments where improvements and
betterments is specifically listed and the building rate applies to it rather than the BPP
rate (building rate usually lower than BPP rate)
✔✔what is personal property of others? - ✔✔Generally applies to property that has
been entrusted to the named insured:
-to work on
-on consignment
-has been sold but not delivered or
-has been leased to the named insured
this only covers the personal property of others for direct damage, not for loss of use.
✔✔17 categories of property not covered - ✔✔-accounts bills, currency, etc
-animals, unless owned by others and boarded by you, or if owned by you, only as
"stock" while inside of buildings
-automobiles held for sale
-bridges, roadways, walks, patios, or other paved surfaces
-contraband
-cost of excavations
-foundations of buildings if below the lowest basement floor, or the surface of the
ground if there is no basement
-land, water, growing crops, lawns, etc
-personal property while airborne or waterborne
-bulkheads
-property covered under another coverage form of this or any other policy
-retaining walls
-underground pipes
-electric data
-valuable papers
,-vehicles or self-propelled machines including water and air crafts that are licensed for
use on public roads or are operated principally away from the described location
(doesn't include, vehicles or machines you mfg., vehicles other than autos you hold for
sale, rowboats out of the water, trailers
-the following property while outside of buildings, grains, hay, straw, fences, radio or
television antennas
✔✔Endorsements that can modify property not covered-additional covered property -
✔✔used to buyback property coverage for property that other wise would be included in
property not covered
✔✔1.5 Learning Objective: given a scenario, recommend endorsements that modify the
definitions of building and your BPP - ✔✔go over endorsements amending the building
and BPP coverage form
✔✔1.6 Learning Objective: Compare and contrast the three methods of writing
commercial property insurance and evaluate the advantages and
disadvantages/considerations of writing a policy on a blanket basis - ✔✔
✔✔Specific Coverage defined - ✔✔applies to a specific limit to a building or personal
property at a single location. If that property is damaged or destroyed by a covered peril,
the specific limit is the most the insurer will pay to repair or replace it
✔✔Scheduled coverage defined - ✔✔when a policy shows separate limits of insurance
applied to two or more individually listed properties these are called scheduled limits of
insurance
✔✔Blanket coverage defined - ✔✔includes the value of all reported properties this total
limit is available to pay losses regardless of which property or location has suffered the
loss.
2 types of blanket
-one limit that applies to more than one type of property
-one limit that applied to more or more types of property
✔✔Blanket Coverage- Coinsurance - ✔✔there is a coinsurance requirement for blanket
coverage and it is usually 90%-100%
✔✔Advantages of blanket coverage - ✔✔1. named insured can apply insurance where
needed when more than one type of property is covered on a blanket basis
2. Blanket coverage handles fluctuating values between locations or fired-rated
divisions
3. reporting forms can be easier to handle
4. NI may have 100% insurance to value at each location, but only had to carry a
minimum of 90% insurance to value for all locations
,✔✔disadvantages to blanket coverage - ✔✔90% or 100% coinsurance required
blanket coverage may not be available due to underwriting restrictions
a statement of values must be obtained from the NI listing each item and the amount of
coverage
rates are only for one year
NI must have the same causes of loss for all covered property
when there are multiple locations all ownership interests must be listed
✔✔1.7 Learning Objective: detail how relevant endorsements will handle fluctuating
values including any reporting provisions - ✔✔go over endorsements that cover
fluctuating values issues
✔✔Endorsements that address fluctuating values- limitation on loss settlement- blanket
insurance - ✔✔this endorsement limits the maximum amount payable for any item to
the percentage shown in the schedule multiplied by the valued reported on the last
statement of values. This applies to your BPP and building . This endorsement severely
restricts the blanket concept
✔✔Endorsements that address fluctuating values- Peak season - ✔✔Allows the named
insured to increase coverage for a specified number of days to reflect predictable,
seasonal increases in BPP. It may be written for any number of periods within the policy
term, but cannot extend beyond the policy term. Additional premium is prorated for the
selected periods
specifies on what day the values increased and shows the additional amount needed
during peak season, not the total limit. Peak season cannot be written on a value
reporting form or on property written on blanket basis
✔✔Value Reporting Form - ✔✔Endorsement is designed for NI's with fluctuating
business personal property values or changing in locations. It provides a means to
accurately measure changing values of BPP in order to provide adequate coverage and
charge the appropriate premium
to use the value reporting form, the NI must have the willingness and the ability to make
accurate and timely required periodic reports
✔✔value reporting form- premiums - ✔✔the premium paid at the policy inception is
considered an advance premium, final premium is determined at the end of the policy
based on the average reports of value submitted. At the end of the year the different
between the advance premium and the final premium is calculated and then either paid
or returned
✔✔value reporting form- correct reporting - ✔✔if the loss exceeds the value reported for
that month the entire provisional limit of insurance which is the limit selected at the
beginning of the policy period is available when the loss follows an accurate report
, Example:
provisional limit: 700k
march-reported -500k
march 15- 700k loss
audit report- 500k for march
will use the 700k provisional because the march report was accurate
✔✔value reporting form- full reporting - ✔✔reports must be accurate, if they are
inaccurate, the coinsurance penalty
Ex: reported values of 400k in april
loss-200k
audited actual values of april- 200k
200k/400k x 200k = $100k pay out
✔✔Value reporting form- reports in excess of the limit of insurance - ✔✔reports in
excess of the limit will be used to determine final premium but in the event of a loss the
policy will not pay more than the limit of insurance
✔✔Value reporting form- failure to submit reports - ✔✔reports must be on time, if the
first report is not filed the policy will not pay more than 75% of what it would otherwise
have paid
✔✔value reporting form- subsequent late reports - ✔✔if the named insured begins
reporting but fails to file a subsequent report the policy will pay no more than the values
shown on the most recent report
✔✔1.8 learning objective: apply the six additional coverages in the building and PP
coverage form and explain how coverage applies in the event of a loss - ✔✔debris
removal
preservation of property
fire department service charges
pollutant cleanup and removal
increased cost of construction
electronic data
✔✔1.9 Learning objective: identify relevant endorsements and describe how they
modify the six additional coverages - ✔✔go over endorsements
✔✔Debris Removal - ✔✔pays to remove debris of covered property as well as some
other debris on the described premises from a covered cause of loss.
QUESTIONS AND SOLUTIONS 2025/2026 RATED A+
✔✔Additional property not covered endorsement CP 14 20 11 91 - ✔✔this is similar to
the additional property not covered endorsement for property, insured or insurer can
elect to list specific BPP that isn't covered
✔✔Leased property endorsement- CP 14 60 07 88 - ✔✔This is used to categorize
business personal property leased to the named insured as your business personal
property rather that categorizing it as personal property of others
✔✔Your business personal property- separation of coverage CP 19 10 06 95 - ✔✔this
endorsement can separate out and specify a limit of your insurance for any of the seven
categories of your business personal property. The your business property limit will now
not apply to the BPP that was separated and specifically listed
-commonly used for improvements and betterments where improvements and
betterments is specifically listed and the building rate applies to it rather than the BPP
rate (building rate usually lower than BPP rate)
✔✔what is personal property of others? - ✔✔Generally applies to property that has
been entrusted to the named insured:
-to work on
-on consignment
-has been sold but not delivered or
-has been leased to the named insured
this only covers the personal property of others for direct damage, not for loss of use.
✔✔17 categories of property not covered - ✔✔-accounts bills, currency, etc
-animals, unless owned by others and boarded by you, or if owned by you, only as
"stock" while inside of buildings
-automobiles held for sale
-bridges, roadways, walks, patios, or other paved surfaces
-contraband
-cost of excavations
-foundations of buildings if below the lowest basement floor, or the surface of the
ground if there is no basement
-land, water, growing crops, lawns, etc
-personal property while airborne or waterborne
-bulkheads
-property covered under another coverage form of this or any other policy
-retaining walls
-underground pipes
-electric data
-valuable papers
,-vehicles or self-propelled machines including water and air crafts that are licensed for
use on public roads or are operated principally away from the described location
(doesn't include, vehicles or machines you mfg., vehicles other than autos you hold for
sale, rowboats out of the water, trailers
-the following property while outside of buildings, grains, hay, straw, fences, radio or
television antennas
✔✔Endorsements that can modify property not covered-additional covered property -
✔✔used to buyback property coverage for property that other wise would be included in
property not covered
✔✔1.5 Learning Objective: given a scenario, recommend endorsements that modify the
definitions of building and your BPP - ✔✔go over endorsements amending the building
and BPP coverage form
✔✔1.6 Learning Objective: Compare and contrast the three methods of writing
commercial property insurance and evaluate the advantages and
disadvantages/considerations of writing a policy on a blanket basis - ✔✔
✔✔Specific Coverage defined - ✔✔applies to a specific limit to a building or personal
property at a single location. If that property is damaged or destroyed by a covered peril,
the specific limit is the most the insurer will pay to repair or replace it
✔✔Scheduled coverage defined - ✔✔when a policy shows separate limits of insurance
applied to two or more individually listed properties these are called scheduled limits of
insurance
✔✔Blanket coverage defined - ✔✔includes the value of all reported properties this total
limit is available to pay losses regardless of which property or location has suffered the
loss.
2 types of blanket
-one limit that applies to more than one type of property
-one limit that applied to more or more types of property
✔✔Blanket Coverage- Coinsurance - ✔✔there is a coinsurance requirement for blanket
coverage and it is usually 90%-100%
✔✔Advantages of blanket coverage - ✔✔1. named insured can apply insurance where
needed when more than one type of property is covered on a blanket basis
2. Blanket coverage handles fluctuating values between locations or fired-rated
divisions
3. reporting forms can be easier to handle
4. NI may have 100% insurance to value at each location, but only had to carry a
minimum of 90% insurance to value for all locations
,✔✔disadvantages to blanket coverage - ✔✔90% or 100% coinsurance required
blanket coverage may not be available due to underwriting restrictions
a statement of values must be obtained from the NI listing each item and the amount of
coverage
rates are only for one year
NI must have the same causes of loss for all covered property
when there are multiple locations all ownership interests must be listed
✔✔1.7 Learning Objective: detail how relevant endorsements will handle fluctuating
values including any reporting provisions - ✔✔go over endorsements that cover
fluctuating values issues
✔✔Endorsements that address fluctuating values- limitation on loss settlement- blanket
insurance - ✔✔this endorsement limits the maximum amount payable for any item to
the percentage shown in the schedule multiplied by the valued reported on the last
statement of values. This applies to your BPP and building . This endorsement severely
restricts the blanket concept
✔✔Endorsements that address fluctuating values- Peak season - ✔✔Allows the named
insured to increase coverage for a specified number of days to reflect predictable,
seasonal increases in BPP. It may be written for any number of periods within the policy
term, but cannot extend beyond the policy term. Additional premium is prorated for the
selected periods
specifies on what day the values increased and shows the additional amount needed
during peak season, not the total limit. Peak season cannot be written on a value
reporting form or on property written on blanket basis
✔✔Value Reporting Form - ✔✔Endorsement is designed for NI's with fluctuating
business personal property values or changing in locations. It provides a means to
accurately measure changing values of BPP in order to provide adequate coverage and
charge the appropriate premium
to use the value reporting form, the NI must have the willingness and the ability to make
accurate and timely required periodic reports
✔✔value reporting form- premiums - ✔✔the premium paid at the policy inception is
considered an advance premium, final premium is determined at the end of the policy
based on the average reports of value submitted. At the end of the year the different
between the advance premium and the final premium is calculated and then either paid
or returned
✔✔value reporting form- correct reporting - ✔✔if the loss exceeds the value reported for
that month the entire provisional limit of insurance which is the limit selected at the
beginning of the policy period is available when the loss follows an accurate report
, Example:
provisional limit: 700k
march-reported -500k
march 15- 700k loss
audit report- 500k for march
will use the 700k provisional because the march report was accurate
✔✔value reporting form- full reporting - ✔✔reports must be accurate, if they are
inaccurate, the coinsurance penalty
Ex: reported values of 400k in april
loss-200k
audited actual values of april- 200k
200k/400k x 200k = $100k pay out
✔✔Value reporting form- reports in excess of the limit of insurance - ✔✔reports in
excess of the limit will be used to determine final premium but in the event of a loss the
policy will not pay more than the limit of insurance
✔✔Value reporting form- failure to submit reports - ✔✔reports must be on time, if the
first report is not filed the policy will not pay more than 75% of what it would otherwise
have paid
✔✔value reporting form- subsequent late reports - ✔✔if the named insured begins
reporting but fails to file a subsequent report the policy will pay no more than the values
shown on the most recent report
✔✔1.8 learning objective: apply the six additional coverages in the building and PP
coverage form and explain how coverage applies in the event of a loss - ✔✔debris
removal
preservation of property
fire department service charges
pollutant cleanup and removal
increased cost of construction
electronic data
✔✔1.9 Learning objective: identify relevant endorsements and describe how they
modify the six additional coverages - ✔✔go over endorsements
✔✔Debris Removal - ✔✔pays to remove debris of covered property as well as some
other debris on the described premises from a covered cause of loss.
