Personal Property & Liability Insurance _ Social Security Flashcards
What are the 3 basic forms of coverage offered by homeowners policies?
- Basic
- Broad
- Open
What is covered under Basic Homeowners Coverage?
- Fire
- Vehicles (damaged caused by vehicles)
- Lightning
- Smoke
- Windstorm
- Vandalism or malicious mischief
- Hail
- Explosions
- Riots or civil commotion
- Theft
- Aircraft
- Volcanic Eruptions
What is covered under Broad Homeowners Coverage?
Basic perils are covered plus six additional named perils:
- Falling objects
- The weight of ice, snow, sleet
- Accidental discharge or overflow of water or steam
- Sudden and accidental cracking, burning, bulging of appliances
- Freezing of plumbing, heating, air conditioning, fire sprinkler system, or appliance
- Sudden and accidental damage from artificially generated electrical currents
What is covered under Open Peril Homeowners Coverage?
Provides protection from losses associated with all perils, except those that are specifically excluded.
What are general exclusions from most homeowners policies?
- Movement of the ground (earthquake, ground movement from volcanic eruption, mud/landslide, and sink hole)
- Ordinance or law regulating the construction, repair, or demolition of a building or structure
- Damage from rising water (including floods; surface and tidal water; waves; water below the surface that exerts pressure on buildings, structures and improvements; and water backing up through drains and sewers)
- Nuclear hazards (including radiation or radioactive contamination)
- Power failure caused by an uninsured peril (such as spoilage due to a freezer thawing out)
- Intentional acts
- Neglect
What are excluded perils that may be covered by an endorsement?
- Sink hole collapse
- Earthquake
- Sewage backup
- Refrigerated property damage
- Floods (separate policy from the National Flood Insurance Program)
What is covered under Section I of most homeowners policies?
Property Insurance coverage
Coverage A: Dwelling
Coverage B: Other Structures
Coverage C: Personal Property
Coverage D: Loss of Use
What is paid for under Coverage A: Dwelling?
repair and replacement for damage to the house and any attached structures
building materials on premises
losses paid for on a replacement cost basis (same or similar quality materials at current material prices)
= [Amount of Insurance Carried / Coinsurance Requirement] X Amount of Loss - Deductible
= (insurance I have ÷ insurance I should have) x Loss - Deductible
** Having full home value amount will cover a full loss less the deductible
What is paid for under Coverage B: Other Structures?
- detached garages
- greenhouses
- storage buildings
typically coverage limit is 10% of Coverage A: Dwelling
losses insured on a replacement cost basis
** structures used for business purposes must have separate business coverage
What is paid for under Coverage C: Personal Property?
tangible moveable property owned by the insured (such as furniture, entertainment equipment, music collections, videos, paintings, lamps, books, clothing, etc.)
typically coverage limit is 50% of Coverage A: Dwelling
losses insured on actual cash value basis
replacement cost endorsement can be purchased to enhance personal property coverage
What are typical limits on personal property items?
$200 - money, bullion, coin collections, and bank notes
$1,500 - securities, bills, evidence of debt, airline tickets, and manuscripts, theft of jewelry, watches, gems, precious metals, and real furs, watercraft (including trailers [not boat affiliated]) and equipment
$2,500 - theft of firearms, silverware, gold-ware, pewter-ware, and similar property
** special endorsement with scheduled items have no deductible and are valued at agreed-upon values
What certain types of personal property are excluded from coverage on a homeowners policy?
- animals, birds, fish
- articles separately described and specifically insured
- motorized land vehicles used off premises
- property of roomers or boarders not related to the insured
- aircraft and parts
- furnishings on property rented out to others
- property held as samples, held for sale, or sold but not delivered
- business data, credit cards, and fund transfer cards
- business property held away from the residence premises
What is paid for under Coverage D: Loss of Use?
additional living expenses incurred when the insured is unable to occupy the dwelling due to damages caused by a covered peril
may also pay for lost rental income during the period in which the property is uninhabitable
typically limit of coverage is 30% of Coverage A: Dwelling (HO-2, HO-3, HO-4, and HO-5 policies)
HO-6 has 50% of Coverage C
HO-8 has 10% of Coverage A
What is covered under Section II of most homeowners policies?
Liability and medical payment coverage
Coverage E: Personal Liability
Coverage F: Medical Payments to Others
What is covered under Section II Coverage E: Personal Liability?
- claims from bodily injury and property damage to others when insured or insured family members are responsible
Min coverage is $100K per occurrence
Insurer will also pay for legal defense and settlement costs associated with a claim
What is covered under Section II Coverage F: Medical Payments to Others?
pays all necessary medical expenses without regard to liability for others arising out of the insured’s activities, premises, or animals
- expenses must be incurred w/in 3 yrs of the accident
- limit of $1,000 to $5,000 is common up to $10,000 for some companies
- does not pay for expenses incurred by the insured or a member of the insured’s HH unless a residence employee
Section I HO Insurance Coverage Different Forms
What is social security retirement eligibility?
must be “fully insured” = earn 40 quarters of coverage
1 quarter = $1,640 in wages subject to Social Security
Increase in monthly benefits by delaying each month after reaching FRA.
Social Security Retirement, Survivorship & Disability Benefits Summary
