RETAKE Chapter 3: Personal lines: DP, HO

Question 1

Difference between HO-3 and HO-5

Answer 1

HO-3 (special form)
Dwelling and other structures on an OPEN Peril basis, Personal property is covered BROAD PERILS

HO-5 (comprehensive Form) Dwelling and other structures on an OPEN PERIL basis, Personal Property on an OPEN BASIS

Question 2

COMMERCIAL Prop. Condition form COMMON CONDITIONS (9)

Answer 2

1. Concealment, misrep, or frad cov.
2. control of property
3. Insurance UNDER 2 or more coverages
4. legal action against the insurer
5. liberalization
6. no benefit to bailee
7. policy period
8. other insurance
9. transfer of rights (subrogation)

Question 2

Volcanic eruptions are all classified as one under how long?

Answer 2

168 hours

Question 3

Common policy DECLEARATIONS (5)

Answer 3

policy period and number
premium
cov. parts inc
mailing address
named insured

“list WHO, WHAT, WHERE AND HOW much COVERAGE”

Question 4

Common policy conditions (6)

Answer 4

cancellation
changes
examantion of books
inspections
premium payment responsibility
transfer of rights

Question 5

When does the state policy take effect?

Answer 5

@12:01AM at the mailing address on the effective date shown

Question 6

Cov A 3

Answer 6

1. structures attached to dwelling
   ie attached garage, deck
2. building materials or supplies on or next to the premisies meant to: contruct, alter, repair the dwelling or other structure
3. building and outdoor eqp. used to service loation
   ie tools, hvac, mover

Question 7

Cov. B 3

Answer 7

1. A. clearly seperated from dwelling.
   ie detached garage, shed, fence
   B. connect only by: Fence Ultility line, similiar connection
2. Rented structures only: someone who isent a tenant of the dwelling, used excluded as a private garage
3. Buisness Purpose (comemrcial/ farming/ manuafacturing) only if: solely for sotring prop. by owner or tenant, gaseous or liquid fuel stored in vehicle

Question 8

Purpose of BOP (3)

Answer 8

1. for a small to medium business
2. prepackaged policy that inc. both property and libaility cov.
3. Cov. automatically inc. cannot be excluded

Question 9

DP-3 includes what that is often excluded?

Answer 9

THEFT, only for building items NOT personal property

Question 10

BOP ELIGIBILITY 5

Answer 10

1. additional underwriting criteria imposed by insures
2. size
3. income limitations
4. complexity of loss exposure
5. type of business operations

Question 11

What is an optional coverage for BOP 4

Answer 11

1. outdoor signs
2. money and securites
3. employment dishonesty
4. equipment breakdown protection

Question 11

Cov. Parts components of a COMM. PROP. (CCP) 7

Answer 11

1. General LIability
2. com. prop. Direct and Indirect
3. Inland Marine
4. Commercial auto
5. equipment breakdown (boiler and machinery)
6. Crime
7. farm

Question 12

MODULAR PARTS (3)

Answer 12

1. common declarations
2. common conditions
3. one or more coverage parts

Question 13

Form structure 7

Answer 13

1. agreement
2. definitions
3. deductable
4. cov. inc. other cov.
5. perils insured against
6. general exclusions
7. conditions

Question 14

General Liability CCP 3

Answer 14

1. Helps protect teams/employees
   2.Pay for broken things or injury
2. keep safe when accidents occur

Question 15

4 clauses of risk for Inland Marine

Answer 15

1. Domestic Shipements and transportation risk
2. Bridges, tunnels and other instrmentals of transportals
3. com. prop. floaters risk
4. personal prop. floaters risk

Question 16

NFIP eligibility 4

Answer 16

-community must meet minimum flood plan management guideline
-eligible structure: 2 solid walls, a roof and principlly above groud

-30 day wait period

-damage must be CAUSED BY FLOOD as def. by NFIP

Question 17

Personal floaters

Answer 17

1. cov. for movable personal property
2. jewlery, camera, laptop, musical intruments, fine arts
3. can be both scheduled, choose type of peril or risk, worldwide
4. “Floating cov. for valubles- whereever they are”

Question 18

Personal Property Floater

Answer 18

1. provides broader coverage for valuable personal items that may not be fully covered under a homeowners policy.
2. jewelry, furs, cameras, fine arts, musical instruments, silverware, golf equipment, and collectibles,
3. unscheduled, all risk, worldwide
4. “Broad, flexible protection for your stuff- almost anywhere”

Question 19

Personal Article Floater

Answer 19

1. Insures scheduled high-value personal items/LISTED ITEMS
2. jewelry, watches, furs, fine arts, cameras, musical instruments, and stamp or coin collections, based on itemized limits agreed upon by the insurer and insured.
3. scheduled basis but not limited to unscheulded, all risk, worldwide
4. “Scheduled cov. for valuble personal property”

Question 20

Personal Effects Floater

Answer 20

1. insures personal property carried or won by travelers naywhere in the world, but not at home
2. jewlery watches, furs (usually limited to $100)
3. …, …, and worldwide
4. “coverage for travelers’ weareble items, excludeing high-risk items like currency.”

Question 21

What are the different Bailee’s Customer coverage forms, and what do they cover?

Answer 21

🔒 Bailee’s Customers Policy

Covers customer’s property in the insured’s care, without regard to liability.

Protects both bailee’s and bailor’s interests.

🧥 Furriers Block

For fur businesses.

Covers merchandise held for sale and customers’ property (for cleaning, repair, or storage).

👗 Cleaners, Dryers, and Laundries

For laundry/dry-cleaning businesses.

Covers loss or damage to customers’ property while in the insured’s possession.

🏢 Warehouseman’s

For warehouses.

Covers customer’s property in storage, usually as excess coverage over other insurance.

🧠 Tip: Think of these as specialized coverage forms based on the type of business holding the property!

Question 22

If the question is about personal items like jewelry or collectibles, and asks about global coverage, the answer is usually

Answer 22

yes — worldwide.

Question 23

Floaters: If it's business-related or tied to a location, coverage is

Answer 23

typically limited.

Question 24

other types of floaters (6)

Answer 24

Contractor’s Equipment Floater (covers tools/equipment at job sites) Installation Floater (for materials being installed at a specific site) Builders Risk Floater (specific to a location during construction) Motor Truck Cargo Floater (limited to routes stated in policy) Commercial Articles Floater (may vary, but often limited by contract) Equipment Floater (Scheduled/Unsched.)