Property Insurance Flashcards

What is 'inland marine insurance' and which DC business would most likely need it?

Answer: Coverage for property in transit and mobile equipment; a DC contractor with tools and equipment

Inland marine insurance covers property in transit and mobile property such as contractor's tools, cameras, or medical equipment—not ocean cargo.

Which DC property insurance concept describes the insured's financial interest in the property at the time of the loss?

Answer: Insurable interest

Insurable interest means the insured would suffer a financial loss if the property were damaged or destroyed.

What is the difference between a 'named insured' and an 'additional insured' on a DC commercial property policy?

Answer: The named insured owns the policy and has full rights; an additional insured has limited coverage for specified interests only

The named insured is the primary party on the policy with full rights. An additional insured is added to extend limited coverage to a third party with an insurable interest.

Which provision in a DC commercial property policy requires the insured to take reasonable steps to protect property from further damage after a loss?

Answer: Duties after loss provision

The duties after loss provision (conditions section) requires the insured to protect property from further damage—for example, by covering a damaged roof to prevent additional water intrusion.

A DC commercial building is vacant for more than 60 days. What typically happens to the property coverage?

Answer: Coverage for certain perils (vandalism, glass breakage, sprinkler leakage, building glass) may be suspended or reduced

Most commercial property policies suspend or exclude certain coverages (vandalism, glass breakage, sprinkler leakage, water damage) when a building has been vacant for more than 60 consecutive days.

What is a 'mortgagee clause' and why is it important in DC property insurance?

Answer: A clause protecting the lender's interest even if the insured voids coverage through their own acts

The mortgagee (lender's loss payable) clause protects the lender's financial interest—the lender receives its share of claim proceeds even if the insured's coverage is voided due to the insured's acts.