Chapter 7 Quizlet

Question 1

Define Commercial Property

Answer 1

Any property owned/used in conjunction with a business and includes building, stock and equipment

Question 2

List the 8 Named Perils on a commercial policy

Answer 2

1. Fire
2. Lightning (including loss to electrical devices)
3. Explosion
4. Impact by aircraft/spacecraft/land vehicle
5. Riot/vandalism/malicious acts
6. Smoke due to sudden/unusual and faulty operation of any stationary furnace
7. Leakage from fire protective equipment
8. Windstorm or hail

Question 3

List 5 ways premium is determined on commercial policy

Answer 3

1. Construction
2. Protection (private or public)
3. Occupancy
4. Location
5. Claims History

Question 4

Commercial BUILDING includes the structure and 4 other parts - List 4 additional parts

Answer 4

1. Fixed structures PERTAINING TO building(s) located on premises
2. Additions AND extensions communicating AND in contact with buildings
3. Materials, equipment, supplies on premises FOR maintenance, normal repairs AND minor alterations to building OR FOR building services, Janitorial supplies, carpentry tools, bolts and nails, paint supplies, carpenting.
4. Growing plants, trees, shrubs, flowers inside building for decorative purposes when insured is owner of building.

Question 5

List the 3 coverages under the definition of STOCK

Answer 5

1. Merchandise (every description) usual to insured’s business.
2. Packing, wrapping, advertising materials.
3. Similar property belonging to others that insured is obligated to keep insured OR that he is legally liable.

Question 6

List the 3 coverage under the definition of EQUIPMENT

Answer 6

1. GENERALLY, all contents usual to insured’s business (furniture, furnishings, fittings, fixtures, machinery, tools, utensils, appliances OTHER THAN building OR stock as defined below: Office furniture, staff room furnishings, photocopiers, forklift, tractor.
2. Similar property that belongs to others that insured is obligated to keep insured OR insured is legally liable for.
3. Tenant’s improvements (defined as building improvements, alterations, betterments) made at expense of insured to a building occupied by insured AND WHICH isn’t otherwise insured PROVIDED insured isn’t the owner of the “building” occupied by insured AND WHICH isn’t otherwise insured PROVIDED insured isn’t the owner of the “building”

Question 7

Co-insurance clause provisions apply to partial losses only True or False

Answer 7

TRUE

Question 8

Co-insurance clause applies ONLY WHERE amount of loss EXCEEDS….

Answer 8

2% of applicable insurance amount OR $5,000

Question 9

In the event of a loss the insurer will pay the least of (3)

Answer 9

a) amount calculated using the co-insurance formula.
b) limit of insurance
c) amount of loss

Question 10

Debris removal will cover NON-INSURED PROPERTY IS BLOWN ONTO PREMISES

Windstorm or tornado causes uprooting of trees, buildings moved off their foundations, True or False

Answer 10

FALSE

Question 11

Finish the statement
Reinstatement Clause - Loss under any items of this form shall….

Answer 11

” Not reduce the applicable amount of insurance WHAT DOES THIS MEAN’ limits of insurance provided by policy are UNCHANGED for ENTIRE policy period REGARDLESS of how many and amounts of claims paid.

Question 12

List 3 Types of Property Protection Systems

Answer 12

1) Sprinkler OR OTHER fire extinguishing system
2) Fire detection system
3) Intrusion detection system

Question 13

List 2 common off premises coverage included for property

Answer 13

1. Property in Transit (lock Vehicle Warranty applies)
2. While at temporary locations for repair or perfoance of work

Question 14

“Locked Vehicle Warranty applies TO PROPERTY under the control of a common carrier - true or false”

Answer 14

FALSE

Question 15

Define TEMPORARY LOCATION

Answer 15

One that is not owned, rented or controlled by insured

Question 16

3 exclusions for exterior glass

Answer 16

1. Accidentally caused by insureds or others
2. Due to earth movement
3. Caused by thieves

Question 17

Burglary insurance Mercantile claim will only be paid when 3 things are proven - list

Answer 17

1. Insured property was UNLAWFULLY taken from within premises,
2. Premises was UNLAWFULLY entered OR exited,
3. There are visible signs of force at point of entry OR exit

Question 18

List 2 types of Burglary Insurance

Answer 18

1. Mercantile Stock Burglary
2. Safe Burglary

Question 19

Robbery Insurance claim will only be paid when 3 things occur - list

Answer 19

Actual OR threatened force is used to take insured property from a party who has control of it
Insured property is taken from a CUSTODIAN who is made unconscious or is killed
Custodian witnessed the taking of insured property but an UNATHORIZED person.

Question 20

List exclusions for Boiler and Machinery coverage

Answer 20

i) Loss/damage to buildings from explosion of these objects that are owned, operated, or controlled by insured: boilers AND pressure vessels operating in excess of 15 pounds/sq inch’’

Question 21

COC stands for

Answer 21

Course of Construction

Question 22

Installation Floater insures property for 3 things -list

Answer 22

PROPERTY IS INSURED WHEN:
1. In transit to job site,
2. Awaiting installation at job site,
3. During installation until accepted OR interest of insured ceases (whichever is first)

Question 23

List 2 TYPES OF BUSINESS INTERRUPTION INSURANCE

Answer 23

1. Earnings Form
2. Profits Form