Homeowners Flashcards
When do you use replacement cost?
On dwellings- no depreciation is deducted
I.e. home needs to be at replacement cost not to sway with market
How is personal property replacement cost factored?
Actual cash value- depreciation. Original cost is irrelevant.
What are basic perils?
WHARVES FLT
Wind, hail, aircraft, riot, vandalism, vehicles,, explosive, smoke, fire, lightening, theft.
What are broad perils
FAR
Freezing, falling objects, artificial electricity, rupture of a systme
What is section 1 coverage?
ABCD
Dwelling, other structures, Personal property, loss of use
What is section II coverage?
EF
Personal liability (Sue Enemy), Medical Payment (First Aid)
What are exclusions to almost all homeowner policies?
OPEN WIF
Ordinance of Law, Power failure, earth movement (quake), neglect, nuclear hazard, war, intentional loss, flood.
If the amount of insurance is less than 80% of the dwellings replacement cost, what does the insurer pay?-
The GREATER of the
-ACV or the amount determined by the following formula
-Replacement cost x coinsurance percentage= insurance required
Insurance carried/insurance required x loss - deductible= amount paid by insurance
What is the coinsurance percentage on homeowners vs commercial?
80% homeowners
90% commercial
When the amount of dwelling insurance is greater than 80% of the replacement cost, how do you calculate insurance coverage?
ACV is not used. Always use formula
Replacement cost X coinsurance percentage= insurance required
Insurance carried/ insurance required x loss- deductible= amount paid by insurance
What is covered under personal auto policy?
A- liability
B Medical payments
C uninsured motorist
D damage to your auto
Which part of the PAP covers hitting an animal or bird?
Other than collision
Which of the following exclusions are generally found in home owners policies?
1. Earthquake
2. Sinkhole/home damaged
3. Flood
4. Carelessness by an insured
- earth quake
- flood
