Key Terms - Chapter 14

Question 1

co-insurance clause

Answer 1

A clause requiring the property owner to insure the property for at least 80% of its value.

Question 2

condition

Answer 2

Limits the coverage of a specified property.

Question 3

endorsement

Answer 3

Adds coverage for specified items or perils that are not covered under other provisions of the policy.

Question 4

exclusion

Answer 4

Something not covered for a loss.

Question 5

homeowner’s policy

Answer 5

Provides coverage for the structure and contents.

Question 6

insurable interest

Answer 6

The insurer must have a legitimate financial interest in a property to be eligible for insurance coverage of any kind.

Question 7

liability insurance

Answer 7

Provides coverage for the financial claims of others.

Question 8

package policy

Answer 8

Combines insurance coverage for the two major elements of property and liability

Question 9

peril

Answer 9

An insured hazard or risk of loss.

Question 10

property or (hazard) insurance

Answer 10

Insurance that provides coverage to the basic structure of the property.