Chap 4 Homeowners Insurance Flashcards
3 levels of homeowners insurance coverage
1) basic/standard policy
2) broad coverage
3) comprehensive coverage
Homeowners insurance
It is designed to provide protection from a financial loss in the event of a fire, flood, earthquake etc… And liability coverage if claims are made against the owner for damages or injuries incurred on the property
Homeowners insurance/ basic or standard policy
It is a named peril policy, only perils listed such as fire, vandalism, and falling objects are covered
Homeowners policy/ broad coverage
Provides all risk coverage on the building and named perils on the content
Homeowners insurance/ comprehensive coverage
Covers building and content for all risks
Coinsurance requirement for homeowners insurance
It is the requirement that the property be insured for a min amount to receive full coverage. It can be from 80 to 100%
Homeowners insurance/ actual cash value
Puts the home back to the condition it was in at the time of the loss, including depreciation
Homeowners insurance/ guaranteed replacement cost
Pays the full cost to repair or replace the home and content with similar quality material even if it more than the policy limit as long as the property is insured 100%
Homeowners insurance/8 categories that determine insurance premiums
1) type of structure
2) detached semi-detached or row house
3) proximity of a fire hydrant
4) owner occupied or rented
5) type of heat
6) size of the deductible
7) personal history with insurance company
8) credit history
Homeowners insurance/ redlining
Denying coverage in an area based on geographical location
Homeowners insurance/ endorsement
Amendments to the original policy that adds subtracts or alters coverage. Folater for a property that moves from one location to another
Homeowners insurance 4 sections of insurance policy
1: declaration page
Section 1: insurance on your property
Section 2: insurance liability
Section 3: conditions
Homeowners insurance section 1: insurance on your property /coverage A
principal dwelling, attached structures and equipment against named perils
Homeowners insurance section 1: insurance on your property /coverage B
Additional buildings and other structures
Homeowners insurance section 1: insurance on your property /coverage C
Personal property. It details property and content coverage that will be provided