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Level One > Ch7: Commercial Property Insurance > Flashcards

Ch7: Commercial Property Insurance Flashcards

1
Q

define commercial property

A

owned/used by business while on premises

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2
Q

List the Commercial property Listed perils (FSWILLER)

A

Fire
Smoke damage
Windstorm/Hail
Impact by Vehicles
Lightning
Leakage
Explosion: of natural or manufactured gas, coal boilers and pressure vessels
Riot

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3
Q

List the Broad Form risks (commercial)

A

Vehicle Impact
Theft (& attempted)
Water damage
Collapse of a building
Smoke (all sources)

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4
Q

What is the fire rate?

A

basic rate to cover fire, lightning, and explosion

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5
Q

What are the factors that effect fire rate?

A

CCOPE

Construction of building
Claims History
Occupancy
Protection (Public & Private)
Exposure (Location)

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6
Q

Define total rate

A

Fire rate + Loading

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7
Q

Define Premium

A

total rate x building value

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8
Q

What information is on the declaration page

A

building described including…
1. Fixed Structures
2. Permanent Fixtures
3. Additions and Extensions
4. Materials and Equipment on-premises
5. Decorative Indoor Plants

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9
Q

Define Stock (Commercial)

A

merchandise usual to the business
1. packing/advertising materials
2. similar property of others

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10
Q

Define Equipment (Commercial)

A

contents usual to the business + similar property of others + tenant improvements.

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11
Q

What is the Co-Insurance Clause?

A

the minimum limit of insurance based on a percentage of values

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12
Q

What is the Waiver of Coinsurance

A

it applies only to partial losses greater than the lesser amount of 2% the amount of insurance or $5000

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13
Q

What does the adjuster determine?

A
  1. ACV of property
  2. Amount of Loss & Limit Purchased
  3. Coinsurance Percentage
  4. Amount of settlement
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14
Q

The Amount of Settlement is…..

A

Penalized if it doesn’t meet the Co-Insurance requirement

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15
Q

What is the Minimum Co-Insurance Amount Formula

A

Value x Co-Insurance Percentage

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16
Q

What is the Settlement Formula used?

A

(Did/Should) x Loss

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17
Q

How is the insured loss payment calculated?

A

Settlement - Loss Amount

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18
Q

The Subrogation Clause

A

Allows the insurance companies to sure the responsible party to recover any claims that have been paid to the insured.

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19
Q

The Reinstatement Clause

A

original amount of insurance is reinstated after loss is paid.

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20
Q

Debris Removal

A

Uses the remainder of the limit (after rebuilding) to pay for removal of debris

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21
Q

Property Protection Systems…

A

get discounts if alarm, sprinklers etc. are installed

22
Q

Conditions of Property Protection Systems

A

insured must notify insurer immediately of any known interruption/defect of protection system & of any cancellation of monitoring maintenance & police services.

23
Q

If conditions are breached the insured can

A
  1. Reduce Coverage
  2. Charge an Additional Premium
  3. Cancel the Policy
24
Q

The In-Transit property form covers you

A

Locked from start to finish including accidental stops

25
Q

What are the terms of Locked-Vehicle Warranty

A
  • Common carriers are excluded
  • Violation voids all coverage
26
Q

The Temporary Locations form covers

A

property in care, custody and control of a bailee for hire at a location not controlled by insured

27
Q

Define a Bailee for Hire

A

repair, service, storage or at a carrier’s department

28
Q

Glass Insurance covers…

A

accidental damage by anyone

29
Q

Valuable Paper Coverage

A

covers cost to recreate if stored properly when not in use

30
Q

Boiler and Machinery…

A

covers equipment breakdown (mechanical breakdown)

31
Q

The policy period on contractors insurance

A

ends when occupied or unattended for more than 30 consecutive days

32
Q

What does builders risk broad form cover

A
  1. materials owned and insured and forming part of the finished project
  2. landscaping and temporary buildings
33
Q

What are the exclusions to builders risk broad form coverage

A

tools ad equipment or cost of making good faulty materials, workmanship or a design

34
Q

Define Limit of Insurance

A

completed value of the construction

35
Q

What is the Contractors Equipment Floater

A

covers moveable equipment owned by the insured

36
Q

Installation Floater for Specialized Contractors covers property…

A
  1. in transit to job site
  2. at job site awaiting installation
  3. during installation until accepted or insured interest ceases
37
Q

Installation Floater for Specialized Contractors excludes…

A

tools and equipment or cost of making good improper

38
Q

List 3 types of crime insurance

A
  1. Burglary
  2. Robbery
  3. Theft
39
Q

What are the two types of Burglary

A

Mercantile and Safe

40
Q

Mercantile burglary covers

A

theft from closed premises if visible signs of force used

41
Q

Safe burglary covers

A

theft to valuable property from safe if force was used to enter the safe - or removal from premises

42
Q

What does robbery cover?

A

money, securities, or valuable property

43
Q

When is robbery insured

A
  1. taken by actual or threatened force to custodian
  2. custodian witnessed property being taken
  3. taken from a custodian killed or rendered unconcouis
44
Q

Define a custodian?

A

someone allowed to have control over the property

45
Q

Define theft

A

taking without the owners consent

46
Q

what does theft cover?

A

theft of stock and equipment (money & securities must be added)

47
Q

What does the money and securities policy cover?

A
  1. Actual destruction – by fire
  2. Disappearance – not attributable to theft
  3. Wrongful abstraction – any unlawful taking of money and securities
48
Q

What is business interruption insurance?

A

restores lost income if caused by insured perils up to the level the business would have earned if the loss hadn’t occurred.

49
Q

When does business interruption insurance begin?

A

on the date of loss for up to 12 months

50
Q

What does business interruption insurance pay for?

A

Pays: loss net profits + expenses that continue during a business interruption

51
Q

What are the three types of interruption insurance

A

Earnings Form: pay until property repaired or 12 months
Profits Form: pay until income restored or 12 months
Extra Expenses Insurance: pay extra expenses needed to maintain normal business

Level One (14 decks)

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