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Level One > Ch7: Commercial Property Insurance > Flashcards

Ch7: Commercial Property Insurance Flashcards

1
Q

define commercial property

A

owned/used by business while on premises

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2
Q

List the Commercial property Listed perils (FSWILLER)

A

Fire
Smoke damage
Windstorm/Hail
Impact by Vehicles
Lightning
Leakage
Explosion: of natural or manufactured gas, coal boilers and pressure vessels
Riot

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3
Q

List the Broad Form risks (commercial)

A

Vehicle Impact
Theft (& attempted)
Water damage
Collapse of a building
Smoke (all sources)

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4
Q

What is the fire rate?

A

basic rate to cover fire, lightning, and explosion

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5
Q

What are the factors that effect fire rate?

A

CCOPE

Construction of building
Claims History
Occupancy
Protection (Public & Private)
Exposure (Location)

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6
Q

Define total rate

A

Fire rate + Loading

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7
Q

Define Premium

A

total rate x building value

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8
Q

What information is on the declaration page

A

building described including…
1. Fixed Structures
2. Permanent Fixtures
3. Additions and Extensions
4. Materials and Equipment on-premises
5. Decorative Indoor Plants

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9
Q

Define Stock (Commercial)

A

merchandise usual to the business
1. packing/advertising materials
2. similar property of others

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10
Q

Define Equipment (Commercial)

A

contents usual to the business + similar property of others + tenant improvements.

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11
Q

What is the Co-Insurance Clause?

A

the minimum limit of insurance based on a percentage of values

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12
Q

What is the Waiver of Coinsurance

A

it applies only to partial losses greater than the lesser amount of 2% the amount of insurance or $5000

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13
Q

What does the adjuster determine?

A
  1. ACV of property
  2. Amount of Loss & Limit Purchased
  3. Coinsurance Percentage
  4. Amount of settlement
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14
Q

The Amount of Settlement is…..

A

Penalized if it doesn’t meet the Co-Insurance requirement

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15
Q

What is the Minimum Co-Insurance Amount Formula

A

Value x Co-Insurance Percentage

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16
Q

What is the Settlement Formula used?

A

(Did/Should) x Loss

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17
Q

How is the insured loss payment calculated?

A

Settlement - Loss Amount

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18
Q

The Subrogation Clause

A

Allows the insurance companies to sure the responsible party to recover any claims that have been paid to the insured.

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19
Q

The Reinstatement Clause

A

original amount of insurance is reinstated after loss is paid.

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20
Q

Debris Removal

A

Uses the remainder of the limit (after rebuilding) to pay for removal of debris

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21
Q

Property Protection Systems…

A

get discounts if alarm, sprinklers etc. are installed

22
Q

Conditions of Property Protection Systems

A

insured must notify insurer immediately of any known interruption/defect of protection system & of any cancellation of monitoring maintenance & police services.

23
Q

If conditions are breached the insured can

A
  1. Reduce Coverage
  2. Charge an Additional Premium
  3. Cancel the Policy
24
Q

The In-Transit property form covers you

A

Locked from start to finish including accidental stops

25
What are the terms of Locked-Vehicle Warranty
- Common carriers are excluded - Violation voids all coverage
26
The Temporary Locations form covers
property in care, custody and control of a bailee for hire at a location not controlled by insured
27
Define a Bailee for Hire
repair, service, storage or at a carrier’s department
28
Glass Insurance covers...
accidental damage by anyone
29
Valuable Paper Coverage
covers cost to recreate if stored properly when not in use
30
Boiler and Machinery...
covers equipment breakdown (mechanical breakdown)
31
The policy period on contractors insurance
ends when occupied or unattended for more than 30 consecutive days
32
What does builders risk broad form cover
1. materials owned and insured and forming part of the finished project 2. landscaping and temporary buildings
33
What are the exclusions to builders risk broad form coverage
tools ad equipment or cost of making good faulty materials, workmanship or a design
34
Define Limit of Insurance
completed value of the construction
35
What is the Contractors Equipment Floater
covers moveable equipment owned by the insured
36
Installation Floater for Specialized Contractors covers property...
1. in transit to job site 2. at job site awaiting installation 3. during installation until accepted or insured interest ceases
37
Installation Floater for Specialized Contractors excludes...
tools and equipment or cost of making good improper
38
List 3 types of crime insurance
1. Burglary 2. Robbery 3. Theft
39
What are the two types of Burglary
Mercantile and Safe
40
Mercantile burglary covers
theft from closed premises if visible signs of force used
41
Safe burglary covers
theft to valuable property from safe if force was used to enter the safe - or removal from premises
42
What does robbery cover?
money, securities, or valuable property
43
When is robbery insured
1. taken by actual or threatened force to custodian 2. custodian witnessed property being taken 3. taken from a custodian killed or rendered unconcouis
44
Define a custodian?
someone allowed to have control over the property
45
Define theft
taking without the owners consent
46
what does theft cover?
theft of stock and equipment (money & securities must be added)
47
What does the money and securities policy cover?
1. Actual destruction – by fire 2. Disappearance – not attributable to theft 3. Wrongful abstraction – any unlawful taking of money and securities
48
What is business interruption insurance?
restores lost income if caused by insured perils up to the level the business would have earned if the loss hadn’t occurred.
49
When does business interruption insurance begin?
on the date of loss for up to 12 months
50
What does business interruption insurance pay for?
Pays: loss net profits + expenses that continue during a business interruption
51
What are the three types of interruption insurance
Earnings Form: pay until property repaired or 12 months Profits Form: pay until income restored or 12 months Extra Expenses Insurance: pay extra expenses needed to maintain normal business

Level One (14 decks)

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