Exam 13: Multirisk Management Contracts: Homeowners

Suppose that at the time of a $40,000 loss, your home has a replacement value of $200,000.And suppose you have $140,000 worth of insurance on it.Calculate the amount that you would receive from the insurer.

Actual cash value of the loss is replacement cost minus _____.

Redlining allegations have the potential to tarnish an insurer's reputation

Paying an extra premium amount to have the main policy's limit for a particular category of personal property increased leaves your coverage on an open perils basis rather than changing it to named-perils.

The insuring agreement for this coverage includes two promises by the insurer: to pay damages for which the insured is legally liable and to "provide a defense at our expense by counsel of our choice, even if the suit is groundless, false, or fraudulent." Identify this coverage in a homeowners policy.

Flood insurance can be purchased through any licensed property or casualty insurance agent or from some direct writing insurers.Some insurers actually issue the flood insurance policies, in partnership with the federal government, as a service and convenience for their policyholders.In those instances, the insurer handles the premium billing and collection, policy issuance, and loss adjustment on behalf of the federal government.Identify these insurers.

Insurers are responding to the _____ doctrine by excluding weather conditions; acts or decisions of governmental bodies; and faulty, inadequate, or defective planning, zoning, development, surveying, design, specifications, workmanship, repair, construction, renovation, remodeling, grading, compaction, and the like.

An important characteristic of coverage D is that it covers only _____.

Identify the correct statement about umbrella policies.

_____ coverage requires that there be loss of property from a known place in such a fashion that theft is the likely cause.

The insuring agreements, exclusions, and conditions for Section II of the declarations page in a homeowners policy are the same for all forms.

Assume that the law in your city provides that a building that does not comply with the building code is permitted to stand, but if it is damaged by fire or other peril to the extent of 50 percent of its value, it must be demolished.Now, your garage does not meet building code requirements and is damaged by fire to such an extent that it must be razed.Identify the situation that follows.

The basic amount for Section II (coverages E and F) is the same for all forms and cannot be increased with the payment of additional premium.

Anything permanently attached to a building is considered to be part of the building.But the phrase "whether or not attached to buildings" makes carpeting, domestic appliances, awnings, outdoor antennas, and outdoor equipment _____ losses.

_____ expenses are those associated with bodily injury liability as covered under the policy and therefore are not limited to the conditions required for medical payments to apply, but they do require the possibility of an insured's liability.

Which of the following is covered under 'Coverage C-Personal Property' of the homeowners policy?

Why are flood risk excluded in homeowners policies? How can you insure against flood?

The "other insurance clause" in homeowners policy Section II conditions makes coverage E "_____," meaning the policy pays only after another coverage is exhausted.

Homeowners policies differ from automobile policies in that they combine several types of coverage into one policy.

Under the _____ of Coverage C of homeowners policy, dollar limits are placed on some property for loss caused by any peril, and on other property for loss caused by theft.