Chapter 15A - Property Insurance Flashcards

1
Q

Actual Cash Value

A

Policy pays for the replacement cost of item minus depreciation

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2
Q

Deductible

A

The amount the insured must pay on each loss

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3
Q

Direct Loss

A

Happens suddenly due to a covered peril

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4
Q

Indirect Loss

A

Occurs as a consequence of a direct loss - EX: rental income lost due to a fire

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5
Q

Liability

A

Coverage in case of a lawsuit filed by another claiming bodily injury or damage to property

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6
Q

Liability Insurance

A

Insurance that covers an individual for financial losses arising out of liability issues.

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7
Q

Monoline Policy

A

One line - covers real estate and personal property.

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8
Q

Mortgage Cause

A

Added to policy by lenders - protects their interest in the preservation and reconstruction of property after a loss, covers cost of loan value in a covered loss

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9
Q

Package Policy

A

Real estate and personal property, plus liability and theft.

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10
Q

Peril

A

1) fire
2) aircraft
3) smoke
4) sinkhole collapse
5) sprinkler leakage
6) lightning
7) explosion
8) wind/hail
9) volcano
10) riot/civil commotion
11) damage done by others’ vehicles

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11
Q

Property Insurance

A

Coverage that indemnifies a person with an interest in the property for a loss cause to property by a covered peril

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12
Q

Replacement Cost Basis

A

Policy pays the replacement cost for lost items.

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13
Q

Umbrella Policy

A

Provide very high limits of liability

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14
Q

Basic Form 1

A

11 perils

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15
Q

Basic Form 2

A

11 perils + weight of ice and snow, water damage from plumbing, damage from falling objects, freezing plumbing

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16
Q

Special Form 3

A

Same has Basic Form 2 plus 3 levels of coverage. A - principal dwelling, B - other structures on property (pool houses, barn, garage), C - personal property.

17
Q

Homeowner 1 - 3

A

Basic 1 -2 and Special Form 3 plus liability and theft

18
Q

Homeowner 4

A

Rental and coop insurance

19
Q

Homeowner 6

A

Condo - covers interior space but not building structure or common areas (covered by building policy)

20
Q

Homeowner 8

A

Modified form for older/ornate homes where replacement cost exceeds market value.