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IA&B PC Insurance > Chapter 5: Homeowners Concepts > Flashcards

Chapter 5: Homeowners Concepts Flashcards

1
Q

What are the eligibility requirements for Homeowners Policy

A

Owner occupied
1-4 family dwelling
incidental business occupancies
2 roomers/boarders per unit
Dwelling under construction
Trusts
No mobile homes

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2
Q

Homeowners 2: Broad Form- what perils are covered

A

Dwelling and personal property
broad named peril basis

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3
Q

Homeowners 3: Special Form- what perils are NOT covered

A

residence and other structures
open perils basis and coverage for personal property on a broad named perils basis

*Theft to dwelling under construction, vandalism if vacant 60+ days, wear/tear/mechanical breakdown/pollution, birds/insects/animals, smoke

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4
Q

Homeowners 4: Contents Broad Form- what perils & specific situation
*renters and tenants

A

broad named peril basis; lack of COV A&B because insured does not own the dwelling or other structures

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5
Q

Homeowners 5: Comprehensive Form- what perils NOT covered

A

dwelling, other structures, personal property on open perils basis

*Theft to dwelling under construction, vandalism if vacant 60+ days, wear/tear/mechanical breakdown/pollution, birds/insects/animals, smoke

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6
Q

How does the HO-3 differ from HO-5

A

HO-5 adds open perils coverage to the personal property; where HO-3 only covers personal property on broad named perils basis

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7
Q

Homeowners 6: Unit Owners Form- what perils are NOT covered
*Residential Condo Form

A

insure individual residential condominium units on a broad named peril basis
insures the dwelling and personal property of the owner-occupant

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8
Q

Homeowners 8: Modified Coverage Form- what perils are NOT covered & when is it used

A

Most limited coverage; limited to ten basic perils
Used if dwelling is older and lower in value and there is a vast difference between replacement value and market value

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9
Q

HO-2,3,5,6: loss settlement

A

COV A&B- RC
COV C- ACV

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10
Q

HO-4: loss settlement

A

COV A&B- none
COV C- ACV

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11
Q

HO-8: loss settlement

A

COV A&B- FRC
COV C- ACV

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12
Q

Functional Replacement Cost (FRC)

A

repair or replace within 180 days, will be paid or the limit of insurance (whichever is less)

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13
Q

Aircraft, Hovercraft, Motor vehicle, Watercraft Liability

A

bodily injury or property damage arising out of ownership liability resulting from described craft

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14
Q

Bodily injury

A

bodily harm, sickness, or disease including care, loss of services and death that result

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15
Q

Occurance

A

accident (continuous/repeated exposure) which results in bodily injury or property damage

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16
Q

Residence Employee

A

employee of an insured

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17
Q

Residence Premises

A

one family dwelling where you reside
2-4 family dwelling where you reside in at least one of the units
the part of any other building where you reside, shown in dec pages

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18
Q

HO-2: Percentage of coverage for each section

A

COV A- selected
COV B- 10% of COV A
COV C- 50% of COV A
COV D- 30% of COV A

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19
Q

HO-3: Percentage of coverage for each section

A

COV A- selected
COV B- 10% of COV A
COV C- 50% of COV A
COV D- 30% of COV A

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20
Q

HO-4: Percentage of coverage for each section

A

COV A- none
COV B- none
COV C- selected
COV D- 30% of COV A

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21
Q

HO-5: Percentage of coverage for each section

A

COV A- selected
COV B- 10% of COV A
COV C- 50% of COV A
COV D- 30% of COV A

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22
Q

HO-6: Percentage of coverage for each section

A

COV A- 5,000 automatically, can purchase additional
COV B- none
COV C- selected
COV D- 50% of COV A

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23
Q

HO-8: Percentage of coverage for each section

A

COV A- selected
COV B- 10% of COV A
COV C- 50% of COV A
COV D- 10% of COV A

24
Q

Reduced amount on HO-2,3,5,8 (3 or 4 family)

A

5% on 3-4 family dwelling

25
Q

Reduced amount on HO-2,3,5,8 (3 is different from 4 family)

A

30% on 3 family dwelling
25% on 4 family dwelling

26
Q

COV A- Dwelling

A

residence on dec pages
structures attached to building
material/supplies next to residence premises
NO COV FOR LAND
*HO-4 no COV A
*up to 10% of the COV C limit (additional cov)

27
Q

COV B- Other Structures (direct loss coverage)

A

anything constructed on the residence premises and separated from dwelling
EX) detached garages and sheds, fences, pools
*1-2 family additional amount of insurance for COV B is 10% of COV A amount/blanket limit
*no COV B in HO-6

28
Q

What are the two exceptions for Business Use under COV B

A

If the structure is rented as a private garage
If the structure is used to store business property of the insured or tenant of the dwelling

29
Q

COV C- Personal Property (direct loss coverage)

A

personal property owned/used by insured anywhere in world
Personal property owned by others while that property is on the resident premises occupied by an insured (eliminates roomers/boarders)
Personal Property of a guest/resident employee while the property is located in any residence occupied by an insured (ex: nanny who travels with insured)

30
Q

What are the limitations for personal property off premises

A

10% of personal property limit

31
Q

What two exceptions for personal property off premise

A

-if personal property is moved from residence b/c being replaced or renovated and not fit to live
-if insured moves to new home coverage at both locations for 30 days

32
Q

11 types of personal property not covered

A

Motor vehicles, unless riding lawn mower or motorized wheelchair
Renters, tenants
Credit cards
business data

33
Q

Perils insured against are different depending on whose tree it is- what perils is a tree covered for if:

A

Insured’s Tree: SWISH (snow, wind, ice, sleet, hail)
Neighbor’s Tree: COV C Perils
Coverage limits for fallen trees: pay up to $1,000 for removal but no more than $500 for any one tree

34
Q

3 coverages included in COV D-Loss of use

A

Additional Living Expenses
Fair Rental Value
Civil Authority Prohibits use

35
Q

Trees, Shrubs, and other plants are also covered as an additional coverage, however only for certain perils- what are they (FLAVVERT)

A

Fire
Lightning
Aircraft
Vehicles
Vandalism
Explosion
Riot or Civil Commotion
Theft

36
Q

COV E- Personal Liability

A

when an insured is legally liable or because of an occurrence that is covered within the scope of the policy
*pay up to the limit of liability for damages

37
Q

COV F- Medical Payments to Others
*How does it differ from COV E; for how long; what are the exclusions

A

pays for medical bills for accidents regardless of fault, no legal liability; expenses within 3 years from the date of the accident; does not apply to insured/resident of the household, except residence employees

38
Q

4 Additional Coverages under Section 2-Liability

A

*paid in addition to limit of liability
Claim Expenses
First Aid Expenses
Damage to Property of Others
Loss Assessment

39
Q

What 4 types of motor vehicles are covered for liability?

A

motorized lawn mower and wheelchair, solely used to service the resident’s premises
Golf cart- 4 person not over 25 miles per hour
Battery powered toy vehicle
Motor vehicles in dead storage at insured’s location

40
Q

What watercraft is not covered for lability

A

Inboard and Inboard/Outdrive- owned

41
Q

What are the duties after a loss under a HO Policy (PINES)

A

Protect from further damage
Inventory the damaged personal property
Notify
Exhibit damaged property to insurance company
Submit signed/sworn proof of loss w/n 60 days after request

42
Q

Explain how losses are settled for COV A,B,C under Section 1-Property
*losses & what’s covered

A
  1. Is it ACV or RC
  2. If ACV and insured less than 80% of RC for COV A, B, C, coinsurance applies
    *coinsurance- did/should x loss = payment
    *COV C, awnings, gravestones, household appl., antenna
  3. If RC and insured at least 80% of full RC, COV A&B, are paid at full replacement value
  4. If RC, and insured less than 80% then coinsurance applies to loss payment
43
Q

Special Provisions

A

How ACV is calculated
Replace the intentional loss exclusions- give back coverage to an innocent insured

44
Q

Purpose & Coverage for limited water back up and sump discharge or overflow discharge

A

Provides coverage for property covered under Section 1
*originates from within the dwelling and backs up through sewers/drains
*overflows/discharge from sump, sump pump, related equipment
*basic limit is $5,000 can be increased to $25,000

45
Q

Purpose & Coverage for Limited Fungi, Wet/Dry Rot, Bacteria

A

liability & property
limits coverage (tearing out, replacing, or remediation)
coverage applies to hidden mold as accidental discharge of water

46
Q

Purpose & Coverage for Permitted Incidental Occupancy

A

Additional coverage for building used to conduct a business
full COV C limit, liability limit of HO applies, no off premise liability

47
Q

Identity Fraud Expense Coverage

A

pays up to $15,000 for expenses to correct/repair individuals credit

48
Q

Scheduled Personal Property

A

special coverage for high value items (jewelry, furs, cameras, silverware)
open perils

49
Q

Scheduled Personal Property-Agreed Value

A

special coverage for high value items; paid on agreed value

50
Q

Home Day Care

A

-adds property/liability coverage for Home Day Care Business
-gives other structure coverage
-liability exclusions: sexual abuse, corporal punishment, aircraft, watercraft, injury to nonresident employee
-premium based upon # of kids

51
Q

Personal Property Replacement Cost

A

Additional coverage for COV C at RC
*schedule high value items

52
Q

Business Pursuits

A

liability coverage for employees who conduct business out of house, but work for someone else (salesperson, clerical)

53
Q

Watercraft

A

adds coverage for scheduled watercraft, inboard motors and outboard motors in excess of 25hp or sailboat in excess of 26ft
Exclusions: racing, bodily injury to employee or while carrying people for charge

54
Q

Personal Injury

A

broaden liability, includes injury from one of the following…
-false arrest
-malicious prosecution
-wrongful conviction/entry to dwelling
-slander/libel
- oral or publication that violates rights of privacy

55
Q

9 Property exclusions in Section 1- HO

A

Ordinance or Law
Earth movement
water damage
power failure off premise
neglect
war
nuclear hazard
intentional loss
governmental action, except when attempting to stop fire

56
Q

What are the additional open perils excluded in the HO-3 and HO-5

A

Collapse, freezing of plumbing, HVAC system
weight of ice that damages fence, patio, pool, retaining wall or foundation
theft to dwelling under construction or theft to building materials used for dwelling
mold or fungus- unless hidden in walls and caused by discharge of water
vandalism/mischief
vacant dwelling more than 60 days
wear and tear
mechanical breakdown
smoke
pollution unless release of pollutant is caused by one of 16 broad named perils
settling, cracking of foundation or roof
birds, rodents, insects
nesting/infestation of animal
animals owned by insured

57
Q

Exclusions under Section 2-Liability
*sections E&F, E only and F only

A

see pgs. 38-41

IA&B PC Insurance (21 decks)

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