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FP512 > Mod 2: Property and Casualty Insurance > Flashcards

Mod 2: Property and Casualty Insurance Flashcards

1
Q

What are the 3 types of coverage generally available in a standard homeowners insurance policy?

A
  1. Basic Coverage
  2. Broad Coverage
  3. Open-Perils Coverage
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2
Q

What does section I of a homeowners policy cover?

A

Property Losses

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3
Q

What does Section II of a homeowners policy cover?

A

Comprehensive liability insurance and medical payments to others, claim expenses, and damage to property of others

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4
Q

HO-2 Policy

A

Broad Form

Provides broad coverage for the dwelling and personal property. In addition, this form broadens certain perisl and adds other perils.

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5
Q

HO-3 Policy

A

Special Form

Most popular homeowners policy.
Real property is covered on an open perils basis. Personal property is covered on a named perils basis.

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6
Q

HO-4 Policy

A

Contents Broad (Tenants or Renters) Form

Designed for tenants who do not own their dwelling.
Personal liability and personal contents coverage only

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7
Q

HO-5 Policy

A

Comprehensive Form

Similar to the HO-3 policy except that personal property is written on an open-perils basis.

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8
Q

HO-6 Policy

A

Unit (Condominium) Owners Form

Provides coverage for the condo owner’s personal belongings and any owned structural part of the building. Also provides liability protection.

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9
Q

HO-8 Policy

A

Modified Form for Special Risks

Provides coverage for those who live in an older home that has a replacement cost exceeding its market value

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10
Q

Section I of a Homeowner’s Policy

Insures the dwelling, including additions or other structures attached to the building.
Also includes limited coverage on landscaping around the dwelling.

Which coverage (A-F)

A

Coverage A

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11
Q

Section I of a Homeowner’s Policy

Insures other structures (detached structures) on the premises of the dwelling.

Which coverage (A-F)

A

Coverage B

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12
Q

Section I of a Homeowner’s Policy

Insures general personal property not specifically named within the contract for provision of specific coverage.

Which coverage (A-F)

A

Coverage C

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13
Q

Section I of a Homeowner’s Policy

Provides loss-of-use coverage, which includes expenses incurred while the dwelling is uninhabitable due to damage caused by a covered peril.

Which coverage (A-F)

A

Coverage D

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14
Q

Section II of a Homeowner’s Policy

Comprehensive liability insurance

Which coverage (A-F)

A

Coverage E

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15
Q

Section II of a Homeowner’s Policy

Medical payments to others, claim expenses, damage to property of others

Which coverage (A-F)

A

Coverage F

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16
Q

What are the 8 general exclusions to the property insuring agreement homeowners forms contain?

A
  1. Ordinance or Law
  2. Earth Movement
  3. Water Damage
  4. Power Failure
  5. Neglect
  6. War
  7. Nuclear Hazard
  8. Intentional Loss
17
Q

Protection for personal property that is in transit or that can be transported.

A

Inland Marine Insurance

18
Q

What are the 3 distinct values a home may be viewed as having?

A
  1. Market Value
  2. Assessed Value: value placed by the taxing authorities
  3. Replacement Cost Value: What it would cost to replace the home as-is
19
Q

How much coverage do you need for a home?

A

You should insure the house for the cost to replace it (replacement cost)

20
Q

Is replacement value determined at the time of policy purchase or at the time of loss?

A

Time of loss

21
Q

How is actual cash value (ACV) determined?

A

Replacement Cost - Depreciation

22
Q

What factors affect the cost of a homeowners policy and its endorsements?

A
  1. Construction: materials, age, upkeep
  2. Location
  3. Policy Type: HO-2 vs. HO-3, etc.
  4. Deductible
  5. Insurer: For example, some insurance companies offer a discount to those who have car insurance with them.
23
Q

What are general exclusions of personal liability insurance policies?

A
  1. Business Pursuits
  2. Rental of Property
  3. Professional Liability
  4. Motor Vehicles
  5. Watercraft
  6. Aircraft
  7. Communicable Disease
  8. War, sexual assault, sale of drugs, etc.
24
Q

What are stand-alone personal liability policies called?

A

Comprehensive Personal Liability (CPL) policies

25
Q

How much liability coverage is enough?

A

-At least as much liability coverage as net worth
-An exception would be high income earners (e.g. doctors, lawyers) who need higher liability limits even as they are starting their careers and have more debt than assets.

26
Q

A type of policy that allows you to gain liability insurance beyond what your homeowners and automobile policies offer

A

Personal Liability Umbrella Policy (PLUP)

*Sometimes called catastrophe liability insurance

27
Q

What are th 5 primary owner/driver factors used to determine automobile cost of insurance?

A
  1. Age & gender of the driver
  2. Use of the vehicle
  3. Type of vehicle
  4. The driver’s record
  5. Credit
28
Q

What is damage by collision?

A

When the insured hit something or the vehicle is overturnd

29
Q

What is Comprehensive Damage?

A

When something other tahn collision damages the insured’s vehicle

30
Q

Insurance Policies

What are endorsements?

Definition

A

Coverage additions or deletions

31
Q

What are the 4 approaches used to provide business or commercial insurance?

A
  1. Monoline Forms combination
  2. Packaged coverage policies
  3. Commercial package policy (CPP) for larger businesses
  4. Businessowner’s policy (BOP) for smaller businesses
32
Q

What are the 7 broad categories of coverage considered when creating comprehensive coverage for a business?

A
  1. Commercial Property Insurance
  2. Boiler and Machinery Insurance
  3. Transportation Insurance
  4. Crime Insurance
  5. Commercial Liability Insurance
  6. Commercial Automobile Insurance
  7. Workers’ Compensation and Employer’s Liability Insurance
33
Q

What are the two forms of social insurance required for businessowners both large and small?

A
  1. Worker’s Compensation Insurance
  2. Unemployment Compensation

FP512 (2 decks)

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