Assignment 3 Flashcards
Dwelling Program and Homeowner’s insurance applies to what 4 types of buildings?
- No more than 4 apartments or family units in dwelling
- Mobile homes with no more than one apartment
- Household personal property in any apartment
- Cooperative or condo used as living quarters or rented to others
What makes the main determination of whether Dwelling Program or Homeowner’s insurance is needed?
if the building in question is the insd’s primary residence
What are the differences between HO and Dwelling insurance? (4)
- Homeowners: covers losses to owner-occupied dwelling structure, and other structures on the land, personal property, and lx to 3p who come onto premises
Dwelling: do not require that the insd property be ‘owner-occupied’
Dwelling policy (def):
covers investment properties that are rented out. Coverage for dwelling itself and liability.
Homeowners policy (def): (4)
coverage for private residential purpose of owner occupied prop of:
® 1-4 family dwellings
® Renters who occupy that type of prop
® Condo unit owners
What types of identify are excluded from HO policies? (4)
- Corp
- Partnership
- Estate
- individual if they don’t occupy the residence
Insured under policy can be (5)
- NI
- Residing spouse
- Residing relatives of either of above
- Any person under age of 21 under care of any such person
- Student away at school if:
- Related to NI
- Under age 24
- Enrolled FT student
What are the 3 main HO forms currently used?
- HO -3 - special form
- HO-4 - contents broad form (renters personal property)
- HO-6
What is HO-3?
special form - provides “all risk” coverage for AB and named peril C (more info under Homeowner’s Policy Perils section
What is HO -4 (3)
- contents broad form (renters personal property)
- Cov A doesn’t appear in this form as structure never covered under this form
- Named perils coverage: (more info under Homeowner’s Policy Perils section
What are the 3 coverage forms for the Dwelling Program?
- DP-1: Dwelling prop basic form
- DP-2: Dwelling prop broad form
- DP-3: Dwelling prop special form
What is the primary difference between the 3 dwelling program forms?
relates to coverage perils
What are the 8 exclusions for Cov C/PPUN?
- Specifically insd (scheduled) articles
- Animals, birds, fish
- Motorized veh except those used to service insd residence or designed to assist handicapped
- Tape decks/similar equip designed to be operated solely by electrical system of motor veh while that equip is in the veh
- Property of renters or other tenants, unless they are related to the isnd
- Property in an apartment that is regularly rented or available for rental to others
- Business data including electronics software media (except cost of blank records or media)
- Specifically insd articles (scheduled)
What are the exceptions under Cov E/LX (2)?
Auto or boating accidents (these would fall under stand alone or umbrella policies)
How does the limit of Cov B relate to Cov A in HO policies?
B is automatically 10% of A
How does the limit of Cov C relate to Cov A in HO policies?
C normally 50% of A
What is generally the limit for property of the insd that is not at the primary residence?
10% of Cov C, but not less than $1000
What is the special limit in HO polices for: loss of money precious metals stored value cards smart cards
$200
What is the special limit in HO policies per occurrence for:
securities
watercraft
trailers accessories and equipment
trailers not used w/watercraft
theft of Jewelry, watches, furs, precious/semi precious stones, electronics
$1500
What is the special limit under HO policies per occurrence for:
business property on res premises
theft of silverware, gold-ware, firearms/related equip
$2500
What is the standard ded for HO policies?
$500 standard
How much is the hurricane ded under HO policy?
- can be 2,5 or 10% or higher of Cov A
Is a hurricane ded per occurrence or per year?
per year (1x a year)
When can a hurricane ded be changed?
only at renewal
How are perils addressed on a HO-3 policy (name peril or all risk?)
all risk coverage for A, B, named for C
How are perils addressed on a HO-4 and HO-6 policy (named peril or all risk)
named perils
What are the nature based perils for a HO policy? (8)
- fire
- lightning
- hail
- windstorm
- smoke
- weight of ice/snow/sleet
- freezing of plumbing, heating, AC, sprinkers, appliance
- volcanic eruption
What are the “man-made” based perils for HO policy? (9)
- explosion
- riot or civil commotion
- aircraft
- vehicles
- vandalism or malicious mischief
- theft
- falling objects
- accidental discharge or overflow or water or steam from heating, AC, sprinker. household app
- sudden/accidental discharge of elec current
How are sinkholes covered in HO policy?
by endorsement offered to every FL resident
peril of catastrophic ground over collapse
What are the 7 basic exclusions under all risk coverage?
- Wear and tear
- Rush
- Mold
- Rot
- Smog
- Industrial smoke
- Settling
What are the 4 water damage exclusions under all risk coverage?
- Flood
- Rising waters
- Backing up of sewer or drains
- Underground seepage
What are the 6 additional exclusions under all risk coverage?
- Power failure that occurs away from residence
- Neglect to use reasonable means save and preserve property at and after a loss
- War
- Nuclear hazards
- Intentional loss created by or at direction of an insd
- Governmental action
Are A & B coverages on an HO policy generally paid out on ACV or RCV?
RCV
What are five limitations on RCV w/coverage A & B on an HO policy?
- awnings
- carpeting
- appliances
- outdoor antennas
- outdoor equipment
What does FL law dictate must happen on an HO policy when RCV is offered?
carrier must pay full RCV w/out reservation regardless of whether or not insd repairs or replaces damaged property
What are the additional coverage limits/conditions for trees, shrubs and plants under HO policy cov A? (2)
Up to 5% of the limit for trees, shrubs and plants, but not more than $500 for any one tree, plant or shrub
What is the addtl cov limit for Fire Dept service charges on HO policy Cov A?
$500
What is the addtl cov limit for unauthorized use on credit cards, forgery and acceptance of counterfeit money on HO policy Cov A?
$500
What is the addtl cov limit for losses arising from building ordinances and laws on HO policy Cov A?
10% of Cov A
What is building ordinances and law coverage intended for?
In rebuilding a damaged structure, it may be necessary to make certain that it conforms to the latest building codes, which can add substantially to the cost. Ordinance or Law coverage is available to cover the additional costs.
What are the five general areas HO liability (E/F) cover?
® Cost of defense
® First aid expenses reimbursing insd for first aid to others at time of accident
® Up to $1000 for damage to property of others that is caused by an insd w/out regard to legal lx
® Up to $1000 to assessments against insd by assoc of property owners
® $10K limit on vicarious parental lx imposed by law
what does commercial property insurance cover?
Covers direct and indirect losses related to properties other than 1-4 family dwellings and farm properties
What are the general deductibles under commercial property insurance? (3)
- $500 standard for all loss or damage
2 Hurricanes
® $500 minimum
® 10% max of policy limit
What are the 8 coverage forms under commercial property insurance?
□ Building and Personal Property coverage form □ Builder's Risk coverage □ Business Income coverage □ Extra Expense coverage □ Legal Lx coverage □ Condo Assoc coverage □ Condo Commercial Unit Owners coverage □ Leasehold Interest coverage form
what are the 3 general types of property that may be covered under Building and Personal Property coverage (commercial)?
® The building
® business personal property
® Personal property of others
What is covered under commercial building coverage? (3)
® Structure described
® including additions, fixtures, outdoor fixtures, permanently installed machinery and equipment, personal property to service the premises including fire extinguishers, outdoor equipment, floor coverings, and appliances
® Includes additions under construction, including materials, equipment, supplies w/in 100 ft of premises
What coverage does business personal property include? (6)
® Furniture ® Fixtures ® Machinery ® Equipment ® Stock ® Owned personal property used in the business
what does personal property of others include (commercial)?
property owned by others but in insd’s care, custody or control, while located on premises
what is the coverage for valuable papers and records (commercial)? (2)
- $2500 coverage for cost of research for each premises
2 .To replace or restore lost info from papers and records
What six causes are suspended if a commercial building is vacant for more than 60 consecutive days?
◊ Vandalism ◊ Sprinkler leakage ◊ Building glass breakage ◊ Water damage ◊ Theft ◊ Attempted theft
If a commercial building sits vacant for more than 60 days under a covered loss, how is the limit adjusted?
amount payable is reduced by 15%
What is the vacant day limit on commercial buildings when some coverages are suspended?
60 consecutive days
What is builder’s risk coverage?
□ Used to cover bldgs in process of construction
What limit is generally set for builder’s risk coverage?
100% of expected completed value
what are the 6 main covered perils for builder’s risk policies?
® Fire ® Explosion ® Hurricane ® Fire ® Flood ® Vandalism ® Other perils Most policies of this type written as "All Peril". Losses generally covered unless specifically excluded
Are builder’s risk policies usually all peril or named risk?
“All Peril”. Losses generally covered unless specifically excluded
What is business income coverage?
□ Covers loss of income for a covered property for a covered loss
How is business income calculated for business income coverage?
□ Business income = net profit or loss, before income taxes that would have resulted, plus continuing normal operating expenses that would have incurred during restoration period
When does the period of restoration generally begin for business income coverage?
□ Period of restoration begins 72 hours after date of direct damage
In what two scenarios does coverage end for business income coverage?
Whichever comes first:
® Date when building could be repaired, rebuilt or replaced w/reasonable speed
® Date the business resumes operations at new, perm location
What is extra expense coverage for commercial?
Reimburses insd for extraordinary expenses incurred to maintain uninterrupted ops while property is being repaired or replaced
What is a legal LX coverage form for in commercial?
□ Covers insd for negligently damaging others’ property while in insd’s care, custody or control
What are the two condo coverage forms that apply in FL?
- Condo Association Coverage Form
2. Condo Commercial Unit Owners coverage Form
What does Condo Association Coverage Form cover? (2)
- Covers building and certain types of property contained w/in unit, if Assoc agreement requires the Assoc to insure it
- ® Because of this, may be times where both Assoc and unit owner policies provide coverage
Assoc would be primary, Unit owner would be exces
What does FL law require for □ Condo Commercial Unit Owners coverage Forms issued/renewed after 01/01/09
must provide primary coverage for
® All portions of condo prop as originally installed or replacement of like kind/quality, accordance to orig plans/spec
® all alterations or adds made to condo prop or assoc prop pursuant to FS 718.113 (2)
What does the 2010 FL statute require for residential condo unite owner coverage (5)
□ 2010 statute requires residential condo unit owner coverage must include $2000 for prop loss assessment coverage
® For all assessments, with no # limit that are related to the same loss
® Must be owned by collective all owners
® Deductible of $250 per directly loss applies
Coverage relates to prop owner’s share of loss to property owned in common by all members of a property owners association
How is flood defined in a flood insurance policy? (6)
□ General and temp condition of partial or complete coverage of:
◊ two or more acres of normally dry land
◊ OR two or more properties, at least one of which is your property due to
® Overflow of inland or tidal waters
® Unusual or rapid accum or runoff of surface water from any source
® Muflow
□ Collapse or subsidence of land along shore of lake/similar body of water as result of erosion or undermining caused by waves or currents of water resulting in flood as defined above
How can a community gain admittance to the NFIP? (4)
□ Study produces flood hazard boundary map
□ Then detailed study leading flood ins rate map
□ Community must then pass ordinances, bldg construct codes and zoning designed to lessen or eliminate future flooding
□ Once above requirements met, the community is admitted to the regular program
What is an eligible structure for a flood policy?
§ Eligible building: structure w/two or more outside rigid walls & fully secured roof built on a perm site w/50% or more of value above ground level and located w/in eligible community
How are eligible contents defined for a flood policy?
§ Eligible contents: must be located in fully enclosed building or secured to prevent flotation out of bldg
What are the resident limits for flood coverage (4)
□ Regular program single-family dwelling:
® $250,000 dwelling
® $100,000 contents
◊ If insd lives in dwell 80% of time, and dwell insd for at least 80% of replace cost, then RCV applies to single-family bldg losses for insd’s principal residence
◊ All other losses are settled at ACV
What are the non-resident limits for flood coverage (2)
$500,000 building
$500,000 contents
