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Homeowner > Major Policy > Flashcards

Major Policy Flashcards

1
Q

All Homeowner forms our package policies because they have two sections

A

Property and casualty (P&C)
• section 1 – property P coverage for your property-first party coverage

  • section 2 – casualty/liability
    * coverage for liability you have caused-third-party coverage
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2
Q

Deductible

A

The standard deductible is $250

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3
Q

Effective date

A

12:01 AM

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4
Q

Eligibility requirements

A

•1–4 unit home
• The named insured must principally reside in the home.
Exception to ensure principally residing• The content brought form (renters insurance)

Must be principally used as a Residence: •beauty shops 
•professional offices 
•music schools 
•art studios
       *NO RETAIL*
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5
Q

Insured locations

A

Newly acquired residence

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6
Q

Policies/forms

A 
HO – 08: modified form
HO – 02: broad cause of loss form
HO – 03: special cause of loss form
HO – 05: comprehensive form
HO – 04: contents broad form (renters insurance)
HO – 06: condo unit owners form
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7
Q

Property coverage

A

All property coverage is for : the named insured/insureds.

Coverage a-The dwelling

Coverage b-the other structures appurtenant structures

Coverage C -personal property

Coverage D – loss of use-consequential losses

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8
Q

Coverage A

A

Include structures directly attached to the dwelling.
•Wall-to-wall carpeting
•furnace
•a pump for well water.

  • Includes materials being used for repairs and construction of the dwelling.
  • Lumber
  • shingles
  • copper pipes.

Does not cover a barn attached by electric line

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9
Q

Loss valuation

A

The H08 is for older homes

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10
Q

HO – 08

A

Market value the price paid after negotiations

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11
Q

Coverage limit A-Limit

A

HO – 06-automatic limit of $1000
HO-2,HO-3,HO-5: The agent should recommend the cost to rebuild
Formula-The square footage of the home X The cost per square foot

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12
Q

Coinsurance/insurance to value/loss value ratio

A

The 80% coinsurance clause/insurance to value/loss value ratio.

Encourage

How much will the insurance company pay: formula: Did/should 80% X the loss= The amount the company will pay.

  • Did equal the limit the policyholder chose for their building.
  • Should equal 80% of the cost to rebuild/value of the building.
      When the insured is caring at least 80% of the cost to rebuild the insurance company will pay for the loss in full.
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13
Q

Coverage B: appurtenant structures/Other structures

A
  • A detached garage.
  • Tool shed.
  • Pool.

Exclusions:unattached structures that are used for a business
Exception and unattached garage rented to store a vehicle

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14
Q

Limit for coverage B

A
  • 10% of a.

* The HO – 4 and HO – 6 do not have any coverage for other structures(B)

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15
Q

Personal property/contents

A

Personal property receives 30 days of coverage when moving to a new residence.
*Even when the insurer has not been notified.

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16
Q

Coverage C- loss valuation

A

Personal property –HO-8, HO-2, HO-3, HO-5,Ho-4, HO-6:Personal property is actual cash value

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17
Q

Coverage C- Limit

HO8,HO2,HO3,HO5,HO4,HO6

A

Personal property:HO8-HO5 is 50% of A

HO4 and HO6: Declared amount

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18
Q

Coverage territory

A

Worldwide

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19
Q

Specified Limits-Any peril causes Damage to personal property

A

Money-$200
Securities, $1,500
Watercraft:includes:trailers, anchors, outdoor motors-$1,500

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20
Q

Specified limits-The peril is theft:Personal Property damage

A
  • Jewelry, furs,watches-$1500
  • Goldware, silverware, Tea sets, trophies – $2500
  • Firearms and related equipment-$2,500
21
Q

Coverage D

loss of use

A
  • Covers indirect losses when the direct loss is covered.

* Additional living expenses:pays when the insured’s residence becomes uninhabitable due to a covered loss

22
Q

Loss of use limit

A

HO8:10% of A
HO2 HO3 HO5: 30% of A
HO4:30% of C
HO6:50% of C

23
Q

Perils. All homeowners policies have coverage A-D for property

A

•The perils covered by coverage A-C are what differentiates the policies

24
Q

Basic perils

A

There are 12 basic perils – they are named/listed perils.
• all homeowner forms cover basic perils. •The HO-8 only has basic perils

The Whales aRe Very Very Very Fat

T-Theft
W-Wind
H-Hail
A-Aircraft 
L-Lighting 
E-Explosion 
S-Smoke
R-Riot/civil commotion 
V-Vehicles 
V-Vandalism/Malicious Mischief 
V-Volcanic Activity/Action 
F-Fire
25
Q

The basic perils are named perils

A

Theft-
•HO-5 covers mysterious disappearance for lost or misplaced items.
•No theft coverage for boats away from the premises.

Wind-
•exterior damage should be covered the exterior must first be damaged.
•No coverage for boats not enclosed in a building or a garage.

Hail-
•For interior damage to be covered the exterior must first be damaged

Explosion-
•Includes the explosion of gas within a furnace or fired vessels

Smoke-
•Must be sudden and accidental
•Includes puff back
•Excludes damage from fireplaces and agricultural smudging

Vehicles-
•Excludes damage done by your own vehicle
•The fence is excluded when struck by a vehicle

Vandalism- Excludes vandalism to a dwelling after 60 days of consecutive vacancy.
Vacant: No people or personal property in the dwelling.
Unoccupied: No one’s home

Volcanic activity/Action-
•The eruptions- above ground damage
•Ash,Lava,Blast or Airborne Shockwaves

Fire-Provides coverage for:
•Firefighter damage (sprinkler/hoses)

26
Q

Crime terms

A

Robbery-
•threatening a person with bodily harm and taking personal property. *Committing a felony

Burglary-Force entry, or exit taking a property from inside a building, locked vault or safe.

Theft-all acts of stealing

27
Q

The broad Peros

A

All Fat Whales Want Fish

  • Artificial electric current
  • Falling objects
  • Water damage from appliances or pipes-Damage from:
    * appliances
    * Pipes
  • Weight of Ice, Snow and Sleet
  • Freezing of plumbing systems

COLLAPSE is an additional coverage provided when you have broad perils


28
Q

Special perils covers

A

Bears
Ice dams
Gutters

Special open all risk

Everything except exclusions

Collapse is also an additional coverage provided when you have special perils

29
Q

Additional coverages: additional coverages are provided by the policy at no additional cost

A
  1. Reasonable repairs:
    •no limit
  2. Fire department service charge:
    •no deductible
  3. Ordinance or law: limit:
    •10% of coverage A
    •HO – 8 excluded

Collapse: HO – 8 is excluded because it only has basic perils

30
Q

Additional coverage: Debris removal/Fallen tree removal

A

Remove any one fall and tree – $500
Remove multiple trees to be removed – $1000

Replacement of trees, shrubs or other plants-
•One plant/tree-$500
•All plants/trees – 5% of coverage A

31
Q

Optional Endorsement

A

Earthquake calls of loss form:
•earthquakes within 72 hours are treated as a single occurrence.
•The deductible is a percentage of the limit. Volcanic eruption

Personal property replacement cost endorsement: actual cash value to replacement cost

32
Q

Mobile home endorsement

A

Eligibility:
HO-2 or HO-3 are The policy options for this endorsement

Coverage A-Cost to rebuild
Coverage B-10% of A
Coverage C-40% of A

33
Q

Mine subsidence/mine collapse

A

•Not a sinkhole
•Must offer
•Provides coverage for dwelling commercial buildings or farm buildings
*limit $100,000

Exclusions: 
•land, 
•trees,
•crops or other plants. 
•Personal property/contents of the structure. 
•Business inventory
34
Q

Liability/casualty

A
  • Personal liability and medical payments to others.
  • Third-party coverage

3rd party coverage:
•Coverage E-personal liability $100,000 per occurrence.
•Coverage F medical payments to others $1000 per person (36 months)

Territory:
• worldwide

35
Q

Who is insured

A

Children and the military are excluded. Resident employee: an employee of the residence only covered for negligence at the resident‘s premises.

Insured pets: cover both residence premise and anywhere in the world

36
Q

Personal liability

A

Pays when the named insured/insured is legally liable for bodily injury or property damage to a third-party.

The limit for personal liability: $100,000 per occurrence

37
Q

Coverage F- Liability

A

Medical payments to others:
•3rd party coverage
• $1000 per person
• three years (36 months) to Place a claim from the date of the accident

Medical payments will pay regardless of fault
• negligence does not have to be established

38
Q

Damage to a rented premises: fire legal liability

A

Provides coverage when the named insured is legally liable for fire damage to real property that they rent or temporary occupy (not yours)

Real property:
•Real estate/real property only.
•Vacation homes.
•Leasing/renting a home or apartment. •Hotel rooms.

Perils:
•Fire
*water damage from firefighters. •Explosion.
•Smoke

39
Q

Supplemental payments

A

Pay above and beyond the policy limit

Loss of earnings after $250 per day for the insured to testify

40
Q

Liability exclusions: covered boats

A

These are covered for watercraft liability three homeowner policy:
•under 25HP outboard motor boat you own.
•Under 50 HP inboard motor boat that you rent.
•Sail boats under 26 feet you own or rent

*fast boats are not covered by homeowners *

41
Q

Exclusions

A

Motor vehicle liability:
•liability excludes your auto.
•Motor vehicle liability provides coverage for:
•vehicles use to service the residence (lawnmower)
Vehicles to assist the handicapped (wheelchair)
motorized golf carts in an approve Community

42
Q

Section 1 and section 2 – conditions

A

Duties after a loss/occurrence clause:

•Protect the property from further loss. •Submit a sign sworn statement of loss and show property damage within 60 days after the loss.
*Obtain an appraisal of damage.

Certificate of insurance:
•evidence of insurance coverage is referenced as an outline of coverage:
*The effective date
*type of insurance coverage
*dollar amount of liability

Mortgage holders/mortgagee clause: •protects the bank that has insurable interest in your home with certain rights and responsibilities.
*If the named insured commits fraud, the mortgagee will still be able to file a claim

43
Q

Loss to a pair or a set clause

A

Value of set minus value remaining equals loss settlement

44
Q

Appraisal clause

A

Rules for what should be done with the insurance company and the insured disagree about the value of the claim

45
Q

Other insurance clause/pro Rata liability

A

Used when two or more homeowners policies cover a loss

46
Q

A homeowner policy can be canceled for

A
  • Nonpayment of premium
  • Property sold in foreclosure
  • Fraud and concealment
  • Inspection reveals the home is uninsurable
47
Q

Cancellation reason

A

Nonpayment of premium: 10 days

48
Q

Cancellation for reasons other than non-payment

A
  • 60 days or less: 10 days.

* More than 60 days/non-renewal:20 days

Homeowner (1 decks)

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