Chapter 7 - Miscellaneous Personal Lines Coverage

Question 1

BOATOWNERS POLICY

Answer 1

is a package policy that provides both property and liability coverage and is used to insure boats that can be towed by a car.

FOR ME: similar to homeowners and PAP, Section 1`-open perils, ACV. Section II-watercraft liab, med payments for pass, UIM but no personal injury liability

7.2

Question 2

COVERAGE NDER A PERSONAL ARTICLES FLOATER

Answer 2

is covered on an open perils basis, and claims are settled on an actual cash value basis with some exceptions.

7.1

Question 3

CROP, HAIL, AND WINDSTROM INSURANCE

Answer 3

specialized policy that protects the insured against reduced yield because of a covered loss to crops before they are harvested

Named perils coverage

typically written with deductibles

coverage ceases when crop is harvested (1 growing season)

Question 4

DIFFERENCE IN CONDITIONS (DIC) INSURANCE

Answer 4

is an open perils policy with a high Deductible. It is used to fill coverage gaps in a property policy such as the perils of earthquake, flood, collapse, and subsidence.

There is no standard policy form

Excludes perils on a standard prop form like fire lightning windstorm hail, etc

No coinsurance or prorata clause

7.3

Question 5

EARTHQUAKE ENDORSEMENT

Answer 5

Can be endorsed except Cali you can have it’s own policy

covers earth movement that is excluded on virtually all property policies, and in some jurisdictions may also be purchased as a separate policy. The Earthquake Endorsement covers the perils of earthquake, earth movement, land shock waves or tremors, landslide, mudslide, mudflow, sinkhole, and the rising, sinking, or shifting of the earth.

All earth movements occurring within a 72-hour period are considered a single occurrence of earth movement.

7.4

Question 6

EMERGENCY PROGRAM

Answer 6

applies when a community is in its earliest stage of participation in the NFIP.

Each loss to property is subject to a $500 deductible, which applies separately to the building and to personal property, including any appurtenant structure and debris removal expense.

7.5

Question 7

EXCLUSIONS IN A PERSONAL ARTICLES FLOATER

Answer 7

include wear and tear, insects or vermin, intentional loss, and war. Specific classes of property also have additional exclusions. Valuation of property under a Personal Articles Floater is on a valued or actual cash value basis, depending upon the type of property

7.1

Question 8

FAIR PLAN

FAIR ACCESS TO INSURANCE REQUIREMENTS PROGRAM

Answer 8

provides basic property insurance to property owners who are unable to secure coverage in the standard property marketplace. Reasons for ineligibility in the standard market include loss history or the failure of the client or property to meet other underwriting guidelines of an insurer.

For risk that are uninsurable.

State run

No farms

Not bound through agencies

7.6

Question 9

FINE ARTS FLOATER

Answer 9

Coverage on a Valued or Agreed value basis

Question 10

FLOOD

Answer 10

is a general and temporary condition of partial or complete inundation of at least 2 acres of normally dry land. It involves the overflow of inland or tidal waters, unusual and rapid accumulation or runoff of surface waters, mudflow, or collapse or destabilization of land from erosion or the effect of waves or water currents exceeding normal, cyclical levels.

7.5

Question 11

FLOOD CONTROL PROGRAM

Answer 11

Communities in flood-prone areas must have established an approved flood control program in order to participate in the NFIP. Only property located in participating communities is eligible for flood insurance.

7.5

Question 12

LAY UP WARRANTY

Answer 12

applies when the insured boat or yacht is in storage and allows for a return of premium due to the reduced risk of loss while the boat is laid up. If the insured operates or lives on the craft during the lay–up period, no coverage applies.

7.2

Question 13

MOBILE HOME INSURANCE

Answer 13

has a Section I and Section II similar to homeowners policy

Cov B,C,D are nearly identical to the same coverages under the homeowners ecept Cov C is @ 40% of Cov A instead of 50%.

$500 expenses to move mobile home when threatened by a covered peril

Open perils

Replacement cost for the mobile home

ACV other items of property

Question 14

MUSICAL INSTRUMENT FLOATER

Answer 14

Newly acquired 30 days

Additional endorsement and premium must be paid for the coverage to extend

Live music no coverage

Question 15

NATIONAL FLOOD INSURANCE PROGRAM (NFIP)

Answer 15

is a federal program administered by FEMA, which enables property owners to purchase flood insurance. Losses are paid or subsidized by the federal government.

7.5

Question 16

PAIR OR SETS CLAUSE

Answer 16

iF A COVERED LOSS OCCURS TO AN ITEM THAT IS PART OF A SET, THE VALUE OF THE REMAINING ITEM IS REDUCED BASED ON THE DIFFERNCE BETWEEN THE VALUE OF THE TOTAL SET AND THE VALUE OF ECH ITEM INDIVIDUALLY. this IS BECAUSE EACH ITEM IS WORTH MOREAS A “SET” THAN ON ITS OWN.

Question 17

PERSONAL ARTICLES FLOATER (SCHEDULED ARTICLE FLOATER)

Answer 17

provides worldwide coverage when used to insuring individual personal property on an itemized or scheduled basis. Coverage under a Personal Articles Floater is covered on an open perils basis, and claims are settled on an actual cash value basis with some exceptions.

7.1

Question 18

PERSONAL INLAND MARINE INSURANCE

Answer 18

is a form of coverage that is written on a homeowners policy by endorsement or as a stand-alone policy. It insures moveable property against direct loss.

Examples of Personal (Floater) are PAF:

ACV basis with valued option

open perils, no deductible

worldwide

scheduled personal property endorsement

basic exclusions like wear and tear, insects, intentional loss and war

• personal jewelry floater
  
  • valued or ACV
  • newly acquired 30 days
• personal effects floater - items worn or carried by tourists and travelers

7.1

Question 19

PERSONAL UMBRELLA COVERAGE

Answer 19

• Provides liability insurance on an excess basis
• Can be written by endorsement or an standalone policy
• Requires underlying primary insurance for all exposures
• Provides higher limits of coverage AND may also provide coverage not afforded by primary policies
• Self-insured retention applies when umbrella drops down (similar to a deductible)
• Worldwide coverage territory

EXCLUSIONS:

Question 20

SPECIFIC CLASSES OF PROPERTY

Answer 20

insured are jewelry, furs, cameras, musical instruments, silverware and gold ware, golfer’s equipment, fine arts, stamp collections, coin collections, and china and crystal.

7.1

Question 21

WRITE YOUR OWN PROGRAM (WYO)

Answer 21

is a federal program administered by FEMA, which enables property owners to purchase flood insurance. Losses are paid or subsidized by the federal government.

is a cooperative effort involving FEMA and the private sector that allows existing property and casualty insurance companies to write, issue, and service flood insurance under their own names.

7.5

Question 22

YACHT POLICY

Answer 22

is designed for larger vessels with crew members and includes Hull Insurance: protection and indemnity coverage, medical payments coverage, personal property coverage for property on the yacht, coverage for fuel spills, and commercial towing.

FOR ME: provides property and liability coverage, has BI and damage to property of others

7.2