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FL 220 License Exam > Chapter 5 - Homeowners > Flashcards

Chapter 5 - Homeowners Flashcards

1
Q

Name the two sections Homeowner policies contain?

A

Section I - Property Coverage

Section II - Liability

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2
Q

List the Coverages under Section I of a Homeowners Policy

A

Coverage A - Dwelling
Coverage B - Other Structures
Coverage C - Personal Property
Coverage D - Loss of Use

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3
Q

List the 6 Homeowners forms

A 
HO 2 - Broad
HO 3 - Special
HO 5 - Comprehensive
HO 4 - Tenant 
HO 6 - Unit Owner
HO 8 - Modified Form
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4
Q

Coverage A, B, and C losses are valued on what basis for HO 2, 3,and 5?

A

Coverage A - RC
Coverage B - RC
Coverage C - ACV

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5
Q

HO 2 Broad form is insured against which perils?

A

HO 2 coverages A, B, and C are insured against Named Perils (total of 16 - same as DP 2)

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6
Q

HO 3 Special Form is insured against which perils?

A

Coverage A - Open Perils except those excluded
Coverage B - Open Perils except those excluded
Coverage C - HO 2 named perils

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7
Q

HO 5 Comprehensive Form is insured against which perils?

A

Coverage A, B, and C are on an open perils basis.

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8
Q

HO 4 Tenants Form is insured against which perils?

A

Coverage C is insured against 16 named perils

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9
Q

HO 6 Unit Owners Form is insured against which perils?

A

Coverage A - Named Perils

Coverage C - Named Perils

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10
Q

HO 8 Modified Form is insured against which perils?

A

The “basic-basic” perils - fire,lightning, wind, hail, explosion, riot or civil commotion, aircraft, vehicles, smoke, volcanic eruption, VMM, theft (limited).

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11
Q

What is the purpose of the HO 8 Modified Form?

A

To Insure properties that are so old, that if we insured the market value of the home, it would cause a moral hazard. The limit chosen for these homes are the functional replacement value.

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12
Q

What percentage of Coverage A is the Coverage B limit for Homeowners?

A

10%

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13
Q

What percentage of Cov A is the Cov C limit for Homeowners?

A

50%

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14
Q

What value or percentage of Cov C is covered for property that is off premise? Example - property located at a dorm.

A

10% or $1000. Whichever is greater

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15
Q

What special Coverage C limit is applied to money, coins, and medals?

A

$200

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16
Q

What special Coverage C limit is applied to deeds, passports, tickets, and stamps?

A

$1500

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17
Q

What special Coverage C limit is applied to watercrafts (including their trailers, engines, and furnishings)?

A

$1500

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18
Q

What special Coverage C limit is applied to loss by theft of jewelry, furs, and stones?

A

$1500

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19
Q

What special Coverage C limit is applied to loss by theft of firearms and ammunition?

A

$2500

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20
Q

What special Coverage C limit is applied to loss by theft of silverware and tea sets?

A

$2500

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21
Q

What special Coverage C limit is applied to property on the premise that is primarily used for business purposes (a personal computer)?

A

$2500

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22
Q

What special Coverage C limit is applied to property away from the premise used primarily for business purposes?

A

$500

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23
Q

What special Coverage C limit is applied to Electronic Apparatus and accessories equipped in motor vehicle?

A

$1500

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24
Q

What special Coverage C limit is applied to electronic apparatus away from premises and not in a vehicle but can only be operated by power from the vehicle?

A

$1500

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25
Q

What is the purpose of Coverage D - Loss of use?

A

Provides coverage for indirect losses caused by a direct loss.

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26
Q

What three coverages are included in Coverage D?

A

Additional Living Expense
Fair Rental Value
Civil Authority Prohibits Use

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27
Q

What are the Coverage D limits for all forms?

A

HO 2, 3, and 5 = 30% of Cov A
HO 4 = 30% of Cov C
HO 6 = 50% of Coverage C
HO 8 = 10% of Coverage A

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28
Q

List the Additional Coverages for Homeowners policies

A 
Debris Removal
Reasonable Repair
Trees, shrubs, and plants
Fire Department Service Charge
Property Removed
Credit Cards, EFT Card, Counterfeit Money
Loss Assessment
Collapse
Glass or Safety Glazing Material
Landlord's Furnishings
Ordinance or Law
Grave Markers
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29
Q

How much will we pay for Debris Removal?

A

Payment is included in the limit of insurance but if that limit is exceeded, we will pay an additional 5%.
$1000 limit applies to debris removal from windstorm

30
Q

Describe the reasonable repairs additional coverage?

A

Provides coverage for costs the insured endures to protect their property from further damage.

Example - tarp for a hole in the roof

31
Q

Describe the trees shrubs and plants additional coverage?

A

Provides 5% of coverage limit for plants damaged by “basic-basic” perils.
$500 limit per plant

32
Q

Describe the Fire Department Service Charge

A

Provides $500 to cover for fire department charges. Does not apply if fire department is part of the jurisdiction of the covered property. This is additional insurance. No deductible.

33
Q

Describe the Property Removed additional coverage

A

Provides coverage for property that is removed due to a covered peril threatening the home. Covers the property for the first 30 days.

34
Q

Describe the Credit Card, EFT card, and Counterfeit Money Additional Coverage

A

Provides up to $500 for insured’s legal responsibility because of theft or unauthorized use of credit cards, EFT, or access devices issued to insured.

35
Q

Describe the Loss Assessment Additional Coverage

A

Provides up to $1000 to cover shared losses to common spaces. Usually seen in policies where there is an HOA. This is additional insurance.

36
Q

Describe the Collapse Additional Coverage

A

Provides coverage for the abrupt falling or caving in of the property. Does not cover fences, awnings, pools.

37
Q

Describe the Glass or Safety Glazing Material Additional Coverage

A

Provides coverage for broken glass but not if property is vacant for 60 days (exception is if breakage occurs due to earthquake).

38
Q

Describe the Landlord’s Furnishings Additional Coverage

A

Provides up to $2500 of coverage for furnishings that the Named Insured provided and rented to others. Does not increase the limit of insurance.

39
Q

Describe the Ordinance or Law Additional Coverage

A

Provides 10% of Coverage A for increased costs the insured incurs due to the reinforcement of any ordinance or law. This is additional insurance.

40
Q

List out the Section I Exclusions

A 
Ordinance or Law, except what is included in the Additional Coverage
Earth Movement
Water Damage
Power Failure
Neglect
War
Nuclear Hazard
Intentional Loss
Governmental Action
41
Q

Describe the Mobile Home Insurance Endorsement

A

Allows for a mobile home to be covered under an HO -2 or HO - 3. Allows for tenants to be covered under HO - 4

42
Q

Describe Other Structures on the Residence Premises - Increased Limits Endorsement

A

Allows for an increase of limits for other structures if 10% of Coverage A is not enough.

43
Q

Describe the Back Up and Sump Discharge or Overflow Endorsement

A

Allows for the Insured to buyback coverage that is excluded under Water Damage exclusion.

44
Q

Describe the Personal Property RC Loss Settlement Endorsement

A

Allows to have personal property valued at RC instead of ACV. Applies to Antennas, jewelry, furs, cameras, silverware, and related equipment. Antiques, art, and collectors items are not subject to this endorsement

45
Q

Describe the Scheduled Personal Property Endorsement

A

Allows to increase personal property limit by scheduling certain items. Coverage is provided on an open-perils basis and excluded vermin, wear and tear, war, and nuclear hazard. Deductible does not apply.
Insured has 30 days (90 days for art) to notify the insurer.
Insured World Wide.

46
Q

Describe the Earthquake Endorsement

A

Provides coverage for earthquake damage to Cov A, B, and C.
A single earthquake is considered 1 or more shocks within 72 hours.
Does not cover flood or the cost of filling land.
Deductible percentage of A, B, or C, whichever is greater, applies.

47
Q

Limited Fungi, Wet or Dry Rot, or Bacteria Coverage Endorsement

A

Provides $10K of coverage for loss caused by fungi, bacteria, or dry rot. Covers the testing of the air, removal of the fungi, and the tearing out and replacement of any part of the building to gain access to the fungi.
Higher limits are available.

48
Q

Describe the Permitted Incidental Occupancies Endorsement

A

Allows for specified limit to be applied for a structure that is on the property and used to conduct business.

49
Q

Describe the Identity Theft Expense Endorsement

A

Pays up to $15,000 for identify theft discovered during the policy period, not from business activity. Must notify the Insurer within 60 days.

50
Q

Are Section II coverages subject to a deductible?

A

No.

51
Q

What are the two coverages within Section II?

A

Coverage E - Personal Liability

Coverage F - Medical Payments to Others

52
Q

Describe Coverage E

A

Pays up to the limit of liability for damages the Insured is legally liable for.
Includes defense costs even if the suit is groundless.

53
Q

Describe Coverage F

A

Provides payment for medical expenses that arise from from bodily injury on the insured’s premises. Can be caused by the Insured’s activities or animals owned by the insured.

54
Q

List the Section II additional coverages?

A

Claim Expenses (Supplementary Payments)
First-Aid Expenses
Damage to Property of Others
Loss Assessment

55
Q

Describe the Loss Assessment Section II Additional Coverage

A

Covers defense expenses and expenses the insured incurs by requests the insurer makes. Provides payments up to $250 for loss of earnings when the insured is requested to do something for the insurer.

56
Q

Describe the First-Aid Expenses Section II Additional Coverage

A

Provides payments for expenses the insured incurs in providing first aid to someone who sustained bodily injury on their property from an insured peril.

57
Q

Describe the Property of Others Section II Additional Coverage

A

Payment up to $1000 is made for damage to property of others caused by an insured. Payment is made regardless of negligence.
Does not cover property covered under Section I or any property owned by the insured or engage in business.

58
Q

Describe the Loss Assessment Section II Additional Coverage

A

Provides up to $1000 for the insured’s share in losses charged by an HOA. Must be the result of Bodily Injury or Property Damage

59
Q

What exclusions apply to all of Section II?

A

Liability arising from Motor Vehicles except when in storage and there is no battery in the VH or off road vehicles not owned by an insured or owned by the insured and used on the premises.
Aircraft and hovercraft are excluded.

60
Q

What exclusions apply to Coverages E and F?

A

Expected or intended injury, except when use to protect people or property
Bodily Injury or Property Damage arising out of business
War
BI or PD arising from a communicable disease from an Insured
Useage of a watercraft

61
Q

What exclusions apply to only Coverage E?

A

Anyone eligible for WC
Property damage to others (additional coverage minimizes this exclusion)
BI to the named insured or any insured

62
Q

What exclusions apply to only Coverage F?

A

Anyone who is eligible for WC benefits

Anyone who resides on the premises (includes tenants) other than a resident employee.

63
Q

Coverage E is on a per ____ and Coverage F is on a per _____

A

Coverage E is on a Per Occurrence and Coverage F is on a Per Person

64
Q

Describe the Home Day Care Endorsement

A

Extends Section I and II to home day c are businesses on the described premise.
Provides an policy year aggregate for the sum of Coverage E (per occurrence) and Coverage F (per person).

65
Q

Describe the Personal Injury Endorsement

A

Adds liability coverage for personal injury - false arrest, wrongful eviction.
Does not cover personal injury sustained by the named insured.

66
Q

Describe the Home Business Endorsement

A

Provides coverage for business property and liability. Includes coverage for premise operation, advertising injury and personal injury
No coverage for professional services.

67
Q

Describe the Watercraft Liability Endorsement

A

Modifies the exclusion and states that Coverage E and F do not apply if the watercraft is used to carry people, rented to others, used for businesses, or used in racing.

68
Q

Describe the Limited Fungi, Wet or Dry Rot, or Bacteria Coverage Endorsement

A

Provides coverage if a third party claims illness as a result of exposure.
Limit of $50K.

69
Q

Describe the Permitted Incidental Occupancies Endorsement

A

Modifies the Section II exclusion that does not allow Coverage E and F to apply during business pursuits. The premise must be used primarily as a residence and the business must be owned by the insured.
Typically used for studios or offices.

70
Q

Describe the Business Pursuits Endorsement

A

Extends liability coverage for the Insured’s involvement in businesses they do not own. Example - teaching and sales.

FL 220 License Exam (14 decks)

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