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Idaho - Property & Casualty Insurance > PSI Premium Property > Flashcards

PSI Premium Property Flashcards

1
Q

What is an example of replacement cost valuation?

A

Fair market value of item at time of loss

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2
Q

True or False: Lightning is covered under a DP-1 form without extended coverage.

A

True - Without endorsement DP-1 only insures against perils of fire, lightning and internal explosion.

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3
Q

What principle holds that the insurer relies on the truthfulness of the applicant and in return promises to pay claims?

A

Good faith

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4
Q

What is not found on the declarations page?

A

Policy exclusions

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5
Q

Under flood insurance program, how long till coverage becomes effective?

A

30th Day

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6
Q

What is the standard limit for Coverage-D Fair Rental Value on dwelling policy forms?

A

20% or .2

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7
Q

What is the property valuation method of paying the full policy amount listed on the dec page regardless of the ACV?

A

Valued policy

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8
Q

What is the waiting period included in the definition of period of restoration in the business income coverage form?

A

72 hours

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9
Q

What is the standard amount of Coverage A - Dwelling provided by the HO-6 unit-owners policy?

A

$1000

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10
Q

Under a farm policy is voluntary parting with property a covered cause of loss under a special form?

A

Yes - often by trickery is covered under the special form where livestock is under a broad form.

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11
Q

What is the valuation basis for Coverage B - BPP under the businessowners policy?

A

Replacement Cost

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12
Q

True or False: Modern construction is subject to functional replacement cost.

A

False - Easy to determine by replacement cost.

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13
Q

Coverage F - Medical payment to others includes coverage for what?

A

Dental Services

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14
Q

What type of insurance do insurers use to transfer risk among themselves?

A

Reinsurance

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15
Q

True or False: Grave markers are covered for named perils under Coverage B.

A

False

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16
Q

True or False: After a car crash you have to rent a replacement vehicle is a direct loss.

A

True - they are physical losses to property by perils that result in damage.

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17
Q

What should the insured do following a loss for most property insurance contracts?

A

PPC / MSC = Prompt, protect complete & make submit cooperate.

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18
Q

What part of a legal contract refers to an exchange of value?

A

Consideration

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19
Q

True or False: Homeowners Coverage E - Personal Liability applies to liability or property arising from acreage the insured is renting for cash crop farming.

A

False

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20
Q

True or False: Choosing a $1000 deductible is an example of risk retention.

A

True - Involves the insured personally assuming all or a portion of a loss.

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21
Q

The property coverage of a BOP includes what?

A

Carpeting that is permanently installed

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22
Q

True or False: Less depreciation losses are settled on an actual cash value basis?

A

True - Defined as ACV minus depreciation.

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23
Q

As a general rule inland marine insurance doesn’t cover what?

A

Merchandise that is being manufactured.

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24
Q

Which of the following HO forms provide the most comprehensive coverage?

A

HO-5 - Coverages on A, B, C and D are insured on special form open perils unless excluded.

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25
Q

What is the special limit of coverage on the HO policy form for property damage to personal watercraft?

A

$1500

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26
Q

What characterizes a policy requiring a deductible for a loss?

A

Risk sharing

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27
Q

What is the chance or uncertainty of loss?

A

Risk

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28
Q

Policy A covers a building for $50k. Policy B covers for $100k. If Company A pays $3k and Company B $6k what is the principle of indemnity for this action?

A

Pro Rata

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29
Q

Under a CPP policy the common policy dec page shows the who, what, when, where and ?

A

How much

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30
Q

True or False: A lightning strike on a home’s chimney is a covered loss for Coverage A Dwelling?

A

True - Coverage A applies only to the dwelling itself.

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31
Q

Who may bring a civil action in the United States district court against any person engaging in conduct constituting an offense?

A

The Attorney General

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32
Q

What is the principle coverage provided under the HO-4 policy?

A

Coverage C

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33
Q

Under the Fair Credit Reporting act a licensee must give notice no later than how many days after a request?

A

3 Days

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34
Q

True or False: Under the equipment breakdown coverage damage to a vacuum tube, glass tube or brush is covered.

A

False since glass is fragile

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35
Q

What defines a loss which is consequential and comes as a result of an original loss?

A

Indirect loss

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36
Q

What is a criteria to determine an insurable risk?

A

Calculable loss

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37
Q

What type of authority is in writing and allows a producer to act on behalf of the insurer?

A

Express

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38
Q

What is the difference between misrepresentation and fraud?

A

Misrepresentation is a representation that is actually false, but fraud is an intentional act designed to deceive.

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39
Q

Who is not authorized to transact insurance in a state?

A

Non-admitted insurer

40
Q

What is the valuation basis for Coverage B - BPP under the business owners policy?

A

Replacement Cost

41
Q

A morale hazard is an example of what?

A

Indifference to loss

42
Q

True or False: A personal injury endorsement added to a HO Policy providies coverage for intermittently enterting his tenant’s apt which violates the lease.

A

True - Covers injuries from false arrest, libel, slander, defamation of character and invasion of privacy.

43
Q

What does an application for insurance by the insured contractually represent?

A

An offer

44
Q

What is excluded as a covered loss under the DP-3 coverage?

A

Damage by ice to outdoor radio and television antennas and aerials.

45
Q

Why is the insuring agreement the heart of an insurance policy?

A

It describes property for covered and perils insured.

46
Q

What is a type of personal property is not covered under Coverage C of personal property?

A

Motor Vehicles

47
Q

Insurance contracts are what type of contracts?

A

Unilateral

48
Q

What forms the basis of a loss under an insurance policy?

A

Loss

49
Q

What is the waiting period for restoration in the business income form?

A

72 hours

50
Q

What policy condition states the terms under which property losses are settled?

A

Loss Settlement

51
Q

What is not a covered cause of loss under the HO-2 Broad Form coverage?

A

Discharge or overflow of water from a sump

52
Q

True or False: Breakage of glass is covered by the HO-2 Broad form coverage?

A

True - Includes breakage of glass or safety glazing materials.

53
Q

The causes of loss form lists what?

A

Perils the property is insured against

54
Q

What is the maximum amount reimbursable for tree debris removal for one occurrence under all homeowner forms?

A

$1000

55
Q

Who is the principle in a bond arrangement?

A

Person needing the bond

56
Q

Who is the oblige in a bond arrangement?

A

Entity requiring a bond

57
Q

What is required to get flood insurance certification?

A

A one time 3-hour course.

58
Q

On Farm Property what is Schedule E cover?

A

Scheduled Farm Personal Property - Does not provide coverage for growing crops, trees or personal property

59
Q

On Farm Property what is Schedule F cover

A

Unscheduled Farm Personal Property - Subject to 80% Coinsurance and up to $100k

60
Q

On Farm Property what is Schedule G cover?

A

Barns, outbuildings and other farm structures - Silos, farm buildings, fences, building materials, television antennas

61
Q

On Farm Property what is Schedule A cover?

A

Dwellings - Limit of $1,000 in any one occurrence

62
Q

On Farm Property what is Schedule B cover?

A

Other private structures - Automatic 10% limit of Coverage A as an additional limit of insurance

63
Q

On Farm Property what is Schedule D cover?

A

Loss of use - Includes the fair rental value in the even the dwelling becomes uninhabitable

64
Q

What is the livestock coverage form based upon?

A

Named peril coverage by basic causes of loss except vehicles.

65
Q

What is custom farming?

A

Specific planting or cultivating operations

66
Q

What farm forms are set up on basic causes of loss?

A

Coverages E & F

67
Q

What does farm broad form of loss include?

A

Electrocution of livestock, attack by dogs, accidental shooting, drowning of livestock

68
Q

What does special form farm loss include?

A

Open peril exclusions except for fire

69
Q

On a farm policy what happens to coverage if building/structure is left vacant or unoccupied for more than 120 consecutive days?

A

Limits of insurance are reduced by 50%

70
Q

What are farm property coverage exclusions?

A

Earth movement, flood, power failure off premise

71
Q

Why was the National Flood Insurance Program created?

A

To combat rising cost of taxpayer funded disaster relief for flood victims.

72
Q

Which valuation method is used by the insurer to specify value of a property before it is issued?

A

Agreed value

73
Q

What does inland marine insurance not cover?

A

Merchandise while being manufactured

74
Q

What policy condition states the terms under how covered property losses are settled?

A

Loss settlement

75
Q

What defines the term peril?

A

Cause of loss

76
Q

What authority is NOT written and allows a producer to conduct the business of the insurer?

A

Implied

77
Q

A BOP policy has two separate Aggregate limits. How many times the limit shown in the declarations for liability and medical are these?

A

Two Times

78
Q

What is a type of personal property not covered under Coverage C?

A

Motor Vehicles

79
Q

Which homeowner form provides the most comprehensive coverage?

A

HO-5

80
Q

Which type of coverage is appropriate for a detached garage in a DP-1 policy?

A

Coverage B

81
Q

Under a farm policy what is a covered loss that is covered under special form?

A

Voluntary parting with property

82
Q

Determining adequate indemnification after a loss is a principle duty of the who?

A

Insurer

83
Q

Coverage F - Medical Payments to Others includes coverage for what?

A

Dental Services

84
Q

What defines the chance or uncertainty of a loss?

A

Risk

85
Q

Which type of a hazard is a person who intentionally increases the chance of loss?

A

Morale Hazard - involves the attitude of the insured

86
Q

What describes an insurers status that meets the insurance department’s standards and is authorized to do business in the state?

A

Admitted

87
Q

What is the purpose of a homeowner’s policy?

A

A package policy that reduces the need for multiple policies.

88
Q

What is a type of insurance the government may step in to provide that is NOT readily available from private insurers?

A

Residual Market - means remaining after & flood insurance is an example.

89
Q

What is something covered under a commercial articles floater?

A

Theft

90
Q

The BOP policy covers the medical expenses for what?

A

Anyone without regard to who is at fault

91
Q

Which type of authority holds that a producer may have whatever authority a reasonable person would assume the producer has?

A

Apparent

92
Q

Under the equipment breakdown coverage form, what does the term breakdown NOT cover?

A

Damage to any vacuum tube or brush

93
Q

What is included under the equipment breakdown coverage form?

A

Failure of pressure or vacuum equipment
Electrical Failure
Mechanical Failure

94
Q

True or False: A mobile home can be insured with a HO-8 modified coverage form?

A

False - Only under an HO-2 or HO-3

95
Q

Which type of insurer is a unincorporated group of people agreeing to insure each other’s losses under a contract?

A

Reciprocal

Idaho - Property & Casualty Insurance (14 decks)

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