Unit 7 Flashcards
Dwelling Policy
provides protection for individuals and families against loss to their dwelling and personal property
The Dwelling policy provides more limited Property coverage than what policy?
Homeowners policy
What does the Dwelling policy NOT cover?
peril of theft
the unendorsed Dwelling policy provides
Property coverage only
the Homeowners policy provides
a package of Property and Liability coverages
To be covered under a Dwelling policy, a dwelling may have ______
up to five boarders and up to four apartments
Does the dwelling have to be occupied by the owner?
No, and it can be under construction as well
A Dwelling policy may also be used to insure what type of home?
mobile homes meeting certain qualifications (permanently located, may only be covered under Basic form)
the owner of a home that is rented to tenants can insure it under what policy?
Dwelling policy (cannot be homeowners policy)
Dwelling property does not have to be only residential, it can also be ____
incidental business and professional occupancies
Dwelling policy covers the named insured and who?
his or her spouse if they live in the same household as the insured
the Dwelling basic form is also known as
DP-1 and DP 00 01
Basic form provides what 4 coverages?
coverage A - Dwelling
coverage B -Other structures
coverage C - personal property
Coverage D - fair rental value
Coverage B - other structures is also known as
Appurtenant - adjacent to but not in contact with
coverage A - Dwelling covers _____
the dwelling, structures attached, materials and supplies, and building or outdoor equipment (attached car, garage)
Coverage B - other structures insures ____
buildings on the premises that are separated from the dwelling by a clear space or connected only by a fence, utility line, etc (not used for farming, manufacturing, commercial purpose)
Coverage C - personal property covers ____
insured’s personal property that is at the described location and is used to the dwelling occupancy
What items of personal property are not covered in Coverage C? (know 4)
-MONEY, accounts, deeds
-bank notes, coins, medals,
-books of account, drawings, paper records, wires, discs
-credit cards and transfer cards
-ANIMALS, BIRDS, FISH
-MOTOR VEHICLES (other than ones used to maintain the premise)
-BOATS (other than rowboats/canoes)
Coverage D - fair rental value
available if covered property loss to the dwelling makes the building uninhabitable and insured can’t collect the rent if loss had not occurred (10% of insurance on dwelling is available for coverage)
the only perils that are automatically covered under the basic form are
-fire
-lightning
-internal explosion
-steam explosions (if equipment is owned leased or operated by insured)
extended coverage perils
insured additional options with basic form
extended coverage perils examples REV C SHAW (V)
-riot
-explosion (not internal it replaces it)
-vehicles
-smoke (not sleet)
-hail
-civil commotion
-aircraft
-windstorm
-volcanic eruption
Vandalism and malicious mischief (V&MM) can be purchased in conjunction with
the extended coverage perils
Dwelling basic form provides certain other coverages
-debris removal
-property removed
-reasonable repairs
fire department service charge
$500 when fire department is called for property from a peril insured against (no deductibles apply)
basic form exclusions
-losses from ordinances or laws that require more expensive reconstruction than the original structure
-losses from earth movement (not direct loss by fire from earth movement)
-water damage
-power interruption
-war
-nuclear hazard
Broad form (DP-2 DP 00 02)
named peril policy that lists the perils that dwellings, other structures, and personal property are insured against
the broad form covers
standard and optional perils available on the basic form (fire, lightning, extended coverage)
DP-2 additional perils
- damage to covered property
- weight of ice, snow, sleet
- falling objects
covered perils - special form always means
opened peril
special form (DP-3 DP 00 03) provides
open peril coverage on dwelling and other structures (personal property covered on peril basis)
all three dwelling forms provide basic policy coverages
- coverage A : dwelling
- coverage B : other structures
- coverage C : personal property
- coverage D : fair rental value
DP - 2 and DP - 3 also include what coverage?
coverage E - additional living expense (after covered loss)
what does Coverage E include?
reasonable motel, dining, laundry, and transportation expenses
Coverage E notes
can be added to DP -1 by endorsement
- additional living expenses if you have to live on your own
DP - 2 and DP -3 include
other coverages not contained in DP - 1
(will not pay more than 500 for trees, shrubs, plants)
collapse
pays for the collapse of the dwelling cased by a list of perils
glass or safety glazing material
pays for the breakage of glass or glazing material thats part of a covered building caused by earth movement is covered
replacement cost coverage
part of DP - 2 and DP - 3 but not 1
DP - 2 and DP -3 settle losses to
personal property at actual cash value
in DP - 2 and DP - 3 losses to the dwelling and other structures are paid on
a replacement cost basis (as long as insured carries insurance equal to 80% or more)
if the insured does not carry enough insurance to qualify for replacement cost coverage…
will be paid actual cash value or proportion of replacement cost (whichever is larger)
proportional replacement cost is calculated by
dividing the amount of insurance by the amount requested to carry to qualify for replacement cost coverage
insurance carried/insurance required x amount of loss = amount of reimbursement
remember formula
