Homeowners Insurance Quiz Flashcards
1
Q
1. Thomas wants the maximum comprehensive protection for his home and personal property. Which homeowners policy should he purchase? A. HO-1 B. HO-2 C. HO-5 D. HO-8
A
- C. The HO-5 is the comprehensive form and provides open peril coverage for dwellings, other structures, and personal property.
2
Q
2. Which of the following perils is covered in all homeowners forms? A. Freezing of pipes B. Weight of ice, snow, or sleet C. Falling objects D. Smoke
A
- D. Smoke is a basic peril covered in all homeowners forms. Fire, lightning, riot, explosion, vehicle, civil commotion, hail, aircraft, windstorm, theft, volcanic eruption, and vandalism are also covered in all homeowners forms.
3
Q
3. Under the homeowners policy, which of the following classes of personal property have special limits for theft losses, but not for any other types of losses? A. Money B. Firearms C. Watercraft D. Property used for business purposes
A
- B. Jewelry, furs, watches, precious stones, silverware, goldware, pewterware, and firearms have special limits for theft but not for other types of losses.
4
Q
4. Except for the HO-8, under an unendorsed homeowners policy, losses to the dwelling and other structures are paid on A. a replacement cost basis B. a repair cost basis C. a depreciation basis D. an actual cash value basis
A
- A. Losses to the dwelling and other structures are paid on a replacement cost basis.
5
Q
- Which of the following would not be covered under Coverage A or Coverage B of the homeowners policy?
A. A barn rented to a neighbor for a retail craft
store
B. An insured’s gardening storage shed
C. A stack of lumber at the edge of the insured’s property that will be used to build a storage shed
D. The insured’s home
A
- A. Dwellings and other structures may not be used for business purposes. A structure
rented to someone other than tenants of the dwelling is excluded unless the other structure is rented as a garage.
6
Q
6. All of the following classes of personal property are specifically excluded from homeowners coverage EXCEPT A. Animals B. Clothing C. Property of boarders D. Credit cards
A
- B. Animals, birds, fish, and property of boarders is excluded. Clothing is covered with no special limit of liability.
7
Q
7. Under an unendorsed HO-3, losses to personal property are paid on A. a replacement cost B. the repair cost C. the depreciation D. an actual cash value
A
- D. Unendorsed HO-3 losses to personal property are paid at actual cash value. If the personal property replacement cost endorsement is added to the policy, then personal property losses would be settled on a replacement
cost basis, rather than actual cash value (depreciated).
8
Q
- Which of the following losses is NOT excluded in all homeowners forms?
A. Earthquake damage to a home
B. Flood damage to a home
C. Accidental and sudden discharge of water from a plumbing system
D. An area power failure that shuts down power for 12 hours and causes the insured’s food to spoil in a refrigerator
A
- C. This is covered in all forms except HO-8.
9
Q
9. What is the standard liability limit for Coverage E? A. $100,000 aggregate B. $100,000 per occurrence C. $100,000 lifetime limit D. $250,000 per occurrence
A
- B. The standard liability limits provided for all bodily injury and property damage is
$100,000 per occurrence.
10
Q
- Which of the following statements is NOT correct regarding the eligibility of insureds under a homeowners policy?
A. The named insured must be the owner-
occupant of the dwelling or a renter who maintains a residential occupancy.
B. The dwelling must be primarily used as a residence.
C. Dwellings under construction are eligible.
D. The home cannot contain more than 2 families.
A
- D. The home cannot contain more than four families.
