FREE Property & Casualty Insurance License MCQ Questions and Answers
The homeowners policy type HO-5 covers all exposures on an all-risks basis. EXCEPT:
Explanation:
Personal property, a home, and other structures are all covered under the HO-5 kind of homeowners policy. This package is not intended to provide coverage especially for the tenant, but rather for owner-occupants. For homes, the HO-5 offers the most comprehensive protection.
Which amount is deducted from the replacement cost value of a particular piece of property to arrive at the actual cash value?
Explanation:
Depreciation value. A single piece of the property's actual cash worth is calculated by deducting the replacement cost from the depreciation value. Because of the lesser value paid, the actual cash value is less appealing to the insured than replacement cost coverage.
Andrew forgot to lock his car door since he was running late for a work meeting. Michael did not want to turn around to go back and secure the car when he noticed it was unlocked. Andrew believed that even if something was stolen, his insurance would pay for the damage. Which kind of risk has Andrew created by failing to return to secure his car door?
Explanation:
Morale hazard. By being aware that his car was unsecured and choosing not to lock the doors to deter theft, Andrew put others at risk. Andrew is counting on his insurance company to pay for any damage to his automobile or any loss of personal items inside.
Is there a specific form or document that the insured must use to notify the insurance company of a claim?
Explanation:
No, a claim could be disclosed through a form, letter, or lawsuit. By sending a loss notice ACCORD form, letter, or litigation notification, the insured can begin the claims procedure. Every one of them will cause the insurance company to open a claims file and launch the claims investigation procedure.
Rebecca was traveling to a job interview. She noticed that the light had just turned red and that she was running late. Rebecca didn't completely look to see whether there were any other cars nearby before continuing through the red light because she didn't want to lose time waiting at the stoplight. But as soon as the light turned green, an automobile entered the intersection, and it collided with Rebecca's. What qualifies Rebecca as the party at fault and justifies this?
Explanation:
Negligent. When Rebecca ran through the red light, she was being careless. Because Rebecca failed to drive safely and in accordance with the law, as a result of her carelessness, an accident resulted.
In order to relocate for a work move, Mary made the decision to rent a townhouse. Mary should get what kind of homeowners insurance to cover her exposures as a tenant.
Explanation:
HO-4. An HO-4 policy is created to address the particular requirements of tenants. Instead of protecting the home itself, this kind of policy protects the tenant's personal belongings or contents. Because the HO-4's coverage does not include the building itself, it is not appropriate for owner-occupants.
Different homeowner policies are covered in both broad and simple forms. Which type, broad or basic, offers the most loss protection?
Explanation: The risks already present in the basic form of loss are increased in the broad form. These extra dangers include collapsing, things falling, and snow weight. Hail, fire, and riot are among the dangers that basic and broad cover.