Homeowners Insurance Practice Exam Answers

Homeowners Insurance Practice Exam Answers

 

What is a homeowners policy?

 

multi-line policies with six different policy forms, only significant difference is the perils.

 

 

What is Section I of the homeowners policy?

 

Property

 

What is Section II of the homeowners policy?

 

Casualty aka Liability

 

 

What is Section I-Property Coverage A?

 

Dwelling

 

 

What is Section I- Property Coverage B?

 

Other Structures

 

 

What is Section I- Property Coverage C?

 

Personal Property

 

 

What is Section I- Property Coverage D?

 

Loss of Use

 

 

What is Section II- Casualty Coverage E?

 

Personal Liability

 

 

What is Section II- Casualty Coverage F?

 

Medical Payments to Others

 

 

What is the Homeowners Tenants form?

 

HO-4

 

 

Coverage A or B will not be on what homeowners policy form?

 

Tenant form HO-4

 

 

There is only enough coverage of A and B to offset betterment’s and improvements on what form?

 

The Condominium Owners form HO-6

 

Coverage A-Dwelling in the homeowners policies insures what?

 

the building in which you live and any permanently attached property such as water heaters, furnaces, central units and carpeting.

 

 

Coverage B-Other Structures in the homeowners policies insures what?

 

protects structures on your property other than your house, such as sheds, detached garages, and swimming pool

 

How is Coverage B calculated?

 

10% of Coverage A

 

 

Coverage C-Personal Property in the homeowners policies insures what?

 

Covers your stuff on and off the residence premises…anywhere on earth.

 

 

How is Coverage C calculated?

 

50% of Coverage A but can be raised

 

 

What are some exclusions on Coverage C?

 

Property insured elsewhere, animals, electronics designed to be operated from a motor vehicle and tapes, property of tenants, business data on paper

 

 

Coverage C Limited Property will give how much for money, gold or silver?

 

$200

 

 

Coverage C Limited Property will give how much for securities?

 

$1500

 

 

Coverage C Limited Property will give how much for boats including trailer, outboard motor and equipment?

 

$1500

 

 

Coverage C Limited Property will give how much for other trailers?

 

$1500

 

Coverage C Limited Property will give how much for on-premises business property?

 

$2500

 

 

Coverage C Limited Property will give how much for off-premises business property?

 

$500

 

 

Coverage C Limited Property will give how much for electronics whil in a moter vehicle?

 

$2500

 

 

Coverage C Limited Property will give how much in the event of theft of jewelry, watches, or furs?

$1500

 

 

Coverage C Limited Property will give how much in the event of theft of silverware or goldware?

 

$2500

 

 

Coverage C Limited Property will give how much in the event of theft of firearms?

 

$2500

 

 

All homeowners have what?

 

Theft

 

 

What are the covered perils under the Homeowners Basic Form?

 

Fire
Lightning
Explosion
Wind and Hail
Riot and Civil Commotion
Vandalism
Volcanic Action
Vehicles and Aircraft
Smoke
Theft

 

 

What are the covered perils under the Homeowners Broad Form?

 

The basic perils
PLUS
Plumbing
Falling Objects
Weight of Snow, Ice, or Sleet
PLUS
the additional coverage of Collapse

 

What are the covered perils under the Homeowners Special Form?

 

Covers all Risk aka Open Perils

 

Explain HO-8.

 

Coverages A,B,C are Basic forms, mainly for older homes

 

 

Explain HO-2

 

Coverages A,B,C are Broad forms

 

 

Explain HO-3

 

Coverages A,B are Special Form and Coverage C is Broad Form

 

 

Explain HO-5

 

Coverages A,B,C are Special Forms

 

 

Explain HO-4

 

No Coverage A or B, Coverage C is Broad Form

 

 

Explain HO-6

 

Coverages A,B,C are Broad Forms

 

Is ACV or RC used for Coverage C losses?

 

ACV

 

 

Is ACV or RC used for Coverage A and B losses?

 

RC

 

 

What is the structural overview of the Homeowners Policies?

 

DICE
Declarations
Insuring Clause
Conditions
Exclusions

 

 

What will you find on a Declarations page?

 

Name, address, peril power, endorsements, deductible, and liability limits

 

What will you find on an Insuring Clause?

 

Basically says the company agrees to provide all the benefits described in the policy subject to the limitations and exclusions noted.

 

 

How many sets of conditions and exclusions are in the Homeowners Policy?

 

2, Section I Property and Section II Casualty

 

What are some additional (free) coverages in Section I?

 

Debris Removal $500
Reasonable Repairs to protect property
Trees, Shrubs and Plants
Fire Department Service Charge $500
Removal
Forgery $500
Loss Assessment
Glass
Ordinance of Law
Landlord Furnishings
Building Improvements

 

 

What are the exclusions in a basic, broad, and special homeowners policy?

 

War
Nuclear
Flood
Earth Movement
Neglect
Intentional
Government Action
Off Premises Power Failure
Concurrent Causation
Sewer Back up and Sump Pump Failure
Building Ordinance

 

What are the exclusions found only in the Special Cause of Loss Form?

 

Damage caused by your own animals
Pollution
Wear and Tear
Hidden mold or dry rot
Settling of patios, foundations, floors or walls
Vandalism after 60 consecutive days of vacancy
Theft to house under construction
Freezing or ice damage to pavement, patio, fence or foundation
Freezing of plumbing if heat is not maintained in the building

 

 

What is the standard Section I Property Deductible?

 

$250

 

 

What is the standard Section I Property Deductible for HO-8?

 

$100

 

 

What is the basic Coverage F- Med Pay limit amount?

 

$1000/person

 

 

How many years will Med Pay cover medical treatment?

 

3 years from the date of the accident

 

 

What is the intent of Med Pay?

 

to avoid lawsuits

 

What are the additional (free) coverages found in Section II?

 

Defense Costs
First Aid to Others
Damage to the property of others

 

 

Does a sailboat have coverage under the liabilty?

 

Yes as long as the sailboat is under 26 feet

 

 

Does motor boats owned by the insure have any coverage?

 

Yes as long as they are under 25 horsepower

 

 

Does rental boats have any coverage?

 

Yes up to 50 horsepower

 

 

The Mobilehome Endorsement can be added to what policies?

 

HO-2 and HO-3

 

 

After the Mobilehome Endorsement is added what is the framework of the contract?

 

Coverage A- the value of the mobilehome
Coverage B- 10% of A
Coverage C- 40% of A
Coverage D-30% of A

 

 

DP-1 =

 

Basic Perils

 

 

DP-2 =

 

Broad Form Perils

 

 

DP-3 =

 

Special Cause of Loss on Dwelling, Broad Form on Contents