Casualty Insurance Policies Flashcards

A Business Owner's Policy (BOP) is designed primarily for:

Answer: Small-to-medium-sized businesses that meet eligibility criteria

A BOP packages property and general liability coverages at a discounted rate for qualifying small-to-medium-sized businesses, making it cost-effective for lower-hazard commercial risks.

Under a personal auto policy (PAP), 'uninsured motorist' coverage pays when:

Answer: An uninsured driver causes bodily injury to the insured or passengers

Uninsured motorist (UM) coverage pays the insured and their passengers for bodily injury caused by a driver who has no liability insurance (or whose insurer is insolvent).

Which homeowners policy form is known as the 'broad form' and covers the dwelling on a named-perils basis?

Answer: HO-2

The HO-2 is the broad form homeowners policy; it covers the dwelling and personal property for a specified list of named perils that is broader than the HO-1 basic form.

In a personal auto policy, Part D (Physical Damage) includes which two coverages?

Answer: Collision and other-than-collision (comprehensive)

Part D of the PAP covers physical damage to the insured's own vehicle: collision (damage from impact with another object) and other-than-collision/comprehensive (theft, fire, weather, vandalism, etc.).

Which of the following is typically excluded under a standard homeowners policy?

Answer: Flood damage

Standard homeowners policies exclude flood damage. Separate coverage must be obtained through the National Flood Insurance Program (NFIP) or a private flood insurer.

A 'claims-made' liability policy provides coverage when:

Answer: The claim is first made against the insured during the policy period, regardless of when the injury occurred

Under a claims-made policy, coverage is triggered by the claim being made (reported) during the policy period, not by when the underlying incident occurred.