Ins Exam D - Homeowners Flashcards
Homeowner General Liability Requirements *
> Residential purposes & max of 1-4 family units
- may be boarders or roomers
Owner-Occupied (except renters policy)
Homes currently under construction will be eligible if the intent is to occupy the home after completion
Homeowners Policy - Parts
Section I: Property - STANDARD DEDUCTIBLE = $250 - APPLIED PER LOSS AS COVERED BY COVERAGES A, B & C - A = Dwelling - B = Other Structures - C = Personal Property - D = Loss of Use \+ Section II: Liability - NO DEDUCTIBLE - E = Personal Liability - F = Medical Payments = Package Protection
Homeowners Policy Forms 2-5
> HO-2 (Broad Form) - Named Peril Coverage
HO-3 (Special Form)
- Open Peril on Real Property
- Named Peril on Personal Property
HO-4 (Tenants or Renters) - Named Peril like HO-2 (No A & B)
- Renter of single family, condo, apt, or mobile homes
- Coverage on personal property, loss of use, & Liab
*HO-5 (COMPREHENSIVE FORM) - all covrgs are Open Peril
PQ: All risk coverage on Hse, garage, & contents
- only 1 does this HO-5
Homeowners Policy Forms 6-8 *
> HO-6 (Condo Owners)
- similar to HO-4 in that content is Primary Coverage needed
- loss assessment up to $1k
- Named Peril cvrg on Covrg C Personal Property
- ACV on additions & alterations
- Building on separate policy > master policy
HO-8 (Modified Form for Special Risks) - ACV Basis Cvrg
- Theft crg & prop away from premises - up to $1k max
- Homes where replacement cost far exceeds market value: Unusual Construction
- In place of HO-1 for property like historic homes
Homeowners Causes of Loss
> Broad Perils: HO-2, 3 (Cvrg C Only), 4, & 6
- Basic Perils:
- Weight of Ice, Snow, Sleet - Freezing
- Volcanic Eruption - Falling Objects (HO-2)
- Accidental discharge or overflow of water or stream
- sudden & accidental tearing apart, cracking, burning, or bulging
- sudden & accidental damage from artificially generated current
Open Peril: HO-3 (Cvrg A & B), 5 = Broadest Cvrg
- everything is covered except Named Excls
Basic Perils: HO-8 (Similar to Old HO-1)
- Fire, Lightning, WCSHAVVER, Vandalism/Malicious Mischief, Theft
Coverage A: Dwelling *
> Covers Dwelling & anything attached to dwelling plus permanent fixtures
- Builtin appliances
- plumbing, electrical, wiring, heating, central air
Covers materials & supplies
- on residence premises
- used to construct, alter, or repair premises
- excludes land
Coverage B: Other Structures *
> Covers building & structures on the premises other than the dwelling set apart by clear space from the dwelling
- standard coverage is 10% of Cvrg A - Detached Garage - Storage Shed - Fences - Free Standing Guest House - Gazebos - Swimming Pools
Coverage C: Personal Property *
> Unscheduled personal property not listed or specifically identified as owned or used by the insured anywhere in the world
- Policy limit is 50% of Cvrg A - owned or used by an insured - Limit off premises for other residence - 10% of Cvrg C or $1k - Property of others @ residence premises - Property of guest or residence EE - Property of dependent students @ college - Personal property is covered for 30 days while moving to a new residencee
SPECIAL COVERAGE C LIMITS **
> Special limits do not increase Cvrg C limit of liab; limit noted is the total limit paid for each loss in that category:
- *$200 = $$, BULLION, BANK NOTES, etc. - counterfeit not covered
- *$500 = BUSINESS PROPERTY AWAY FROM PREMISES
- $1,500 = *SECURITIES, ACCTS, DEEDS, EVIDENCE of DEBT
- *WATERCRAFT, TRAILERS, EQUIPMENT, & O/B MOTORS
- *THEFT of JEWELRY, WATCHES, FURS, PRECIOUS STONES
- Other Trailers
- $2,500 = Silverware, gold ware, pewter ware
- *BUSINESS PROPERTY ON PREMISES
- *FIREARMS & RELATED EQUIPMENT
COVERAGE D: LOSS OF USE **
Covers thee necessary increased expense incurred while occupying temp quarters following a loss when residence is uninhabitable due to a covered loss.
- Additional Living Expense:
- normal standard of living
- additional living expense covered only during time of restoration
- shortest possible time needed to restore
- shortest time to permanently relocate
Section I (1): Standard Exclusions *
> Water Damage - water source is from outside
- Flood - Backup of sewer or drain
Earth Movement - earthquakes, volcanic, shock waves, land slide, mudflow, sinkholes, & mine subsidence
Ordinance or Law - acts regulating construction > repair or demolition
Power Failure - occurring off premises
Vehicle - operated by insured except those used for property maintenance
Section I (1): Standard Exclusions - Earthquake *
> Earthquake is specifically excluded under homeowners forms, but coverage can be added w/ earthquake endt
Earthquake Coverages
- Earthquake, land slides, volcanic eruptions, and earth movements that occur w/in a 72 hr (168 hrs - commercial property) period as if they were a single loss.
Section I (1) - Property: Conditions *
> Loss Settlement
- Cvrg A & B replacement cost provision - 80% co-ins
- ACV paid for personal prop, awnings, carpet, appliances, antennae - structure not buildings
Mortgagee - specifies rights & duties of lender or mortgagee
*APPRAISAL - either party may demand an appraisal if no agreement on loss payment
*ABANDONMENT - insured may not abandon any property claimed in order to obtain a total loss setttlement
*OTHER INSURANCE - pay proportionately if more than one insurer covers property
Fair Rental Value *
> When part of dwelling is used as a rental dwelling
Less expenses that do not continue due to uninhabitable premises
Losses must result from a covered peril
Section II (2) - Liability Coverage *
> *NO DEDUCTIBLE APPLIES
Coverage E: Personal Liability - $100k or higher limits selected
- dog bites, injuries on premises due to insured negligence, personal activities such as errant golf ball
Coverage F: Medical Payments to Others
- Covers paid medical up to 3yrs from the date of accident w/o regard to fault
- $1k per person - can be increased
- “Good Will” coverage
- Medical Expenses - medical, surgical, x-ray, dental, ambulance, hospital, nursing, prosthetic devices, and funeral expenses.
