SFP and DPs

Question 1

What perils are covered in SFP home policy?

Answer 1

FLR- Fire, lightning, and removal

Question 2

On an SFP policy, how long does the insured have for removal (or storage costs) to be covered?

Answer 2

5 days

Question 3

Should you or anyone you know ever pay money for a SFP policy?

Answer 3

Hell no.

Question 4

Is theft covered in any circumstance under an SFP policy?

Answer 4

ONLY if the property is stolen during the 5 day removal (storage) coverage or while in transit to or from the storage site.

Question 5

In North Carolina (and in general practice), what is the standard inception time (start time) of new insurance policies and expiration times of expiring or cancelled policies?

Answer 5

12:01 AM

Question 6

How are SFP policies valued in the case of a loss?

Answer 6

By actual cash value (replacement cost-depreciation)

Question 7

What is Pro-rata liability?

Answer 7

If the insured somehow is covered for the same loss under two different companies policies.

Question 8

How is pro-rata liability determined (what is the formula)?

Answer 8

Insurer A limit of liability/(insurer A limit + insurer B limit)= insurer A’s percentage of liabilty. This is multiplied by the amount of loss and equals insurer A’s fiscal responsibilty.

Question 9

What is the pro-rata amounts owed by two insurance companies if company A insures the client at $150000 and company B’s limit is $100000. The insured’s loss was $100000.

Answer 9

Company A- $60000, company B- $40000

Question 10

Who determines what amount ACV is in a loss?

Answer 10

An appraiser.

Question 11

What are the important steps required to be taken by an insured after a loss?

Answer 11

Provide the insurer with an immediate written notice of loss, protect the property from further damage, provide a list of inventory damaged or otherwise and values of said items.

Question 12

What type of homes are normally covered under dwelling policies?

Answer 12

Non-owner occupied; usually rented, but potentially used for small service based business.

Question 13

What is the only type of home policy that can be written for a mobile home?

Answer 13

DP-1

Question 14

What are the 5 coverages of a dwelling policy?

Answer 14

A- Dwelling (actual cost of home reconstruction); B- other structures; C- personal property; D- loss of fair rental value; E- additional living expense

Question 15

What two coverages on a dwelling policy are NOT subject to a deductible?

Answer 15

D and E

Question 16

What year would you guess these in class videos were made?

Answer 16

I’m going with 2006

Question 17

How long are the removal times for DP-1, DP-2, and DP-3? hint- DP-1 is different

Answer 17

DP-2 and DP-3, 30 days; DP-1, 5 days

Question 18

What are the key differences in a DP-1 policy vs. DP-2&3 in terms of payout if there was a loss? hint- the differences are for coverage B, D, and E.

Answer 18

Coverage B and D are not paid out in addition to coverage A, they are paid out from coverage A (see table on pg.35) Coverage E is not included in a DP-1 policy.

Question 19

What 3 coverages are included on a DP-2&3 policy but not a DP-1?

Answer 19

Lawns, trees, and shrubs; collapse of the building; breakage of glass or safety glazing materials.

Question 20

DP-1 is what kind of policy?

Answer 20

Named peril OR basic form

Question 21

What amount of personal property is covered in a worldwide personal property claim?

Answer 21

10% of coverage C (personal property)

Question 22

What two perils are never covered in a home policy?

Answer 22

Earthquake and flood

Question 23

DP-2 is what kind of policy?

Answer 23

named peril OR broad form

Question 24

How many cups of coffee do I drink in a day?

Answer 24

Not enough. Never enough!

Question 25

What perils does a DP-1 policy cover?

Answer 25

FLI- Fire, lightning, and internal explosion.

Question 26

What extended coverages can one add to a DP-1? hint, its a long acronym…

Answer 26

REV CV SHAW- Riot, explosion, vehicles, civil commotion, volcanic eruption, smoke damage, hail, aircraft, windstorm

Question 27

What perils does a DP-2 (Broad form) policy cover?

Answer 27

FLI, EC (REVCVSHAW), VMM, and 7 others- damaged caused by burglars, damage caused by meteorites, damage caused by weight of ice, snow, or sleet, accidental discharge of steam, sudden tearing or cracking of a steam or hot water system, freezing of plumbing.

Question 28

What does VMM stand for?

Answer 28

Vandalism and malicious mischief (but not fun mischief)

Question 29

What kind of policy is a DP-3?

Answer 29

open peril OR special form

Question 30

What two exclusions were noted as important to know for a DP-3 policy? (there are 10 listed in the book)

Answer 30

Freezing of plumbing while the building is vacant, and theft to the dwelling while under construction.

Question 31

How many days notice of cancellation does an insurer need to give an insured in the case of non-payment of premium?

Answer 31

10

Question 32

How many days notice of cancellation does an insurer need to give an insured in the case of non-renewal?

Answer 32

30

Question 33

How many days notice of cancellation does an insurer need to give an insured in the case of non-payment of premium after 60 days of the policy taking effect?

Answer 33

30

Question 34

What coverage is missing from SFP and all DP policies that would always be included on an HO policy? (not including loss of use)

Answer 34

Liability

Question 35

What does section II refer to?

Answer 35

Liability coverage