Insurance Basics
What is the chance or potential for loss?
Risk
For Replacement Cost Coverage to apply, the insured must carry insurance for what percentage of the replacement value of the property at the time of the loss?
80%
Which liability doctrine establishes that a manufacturer of a product will be held liable for bodily injury or property damage arising from the use of their product, whether or not the product was defective?
Strict Liability
Which Dwelling coverage includes coverage for property damaged in transit between the old and new residence?
Coverage C
Under the HO-2, the Additional Living Expense (Loss of Use) Coverage is found under:
Coverage D
The extent to which one may be affected by a peril is known as?
Loss Exposure
When an insurer automatically increases coverage mid-term in a personal policy without an increase in premium, it is called
Liberalization
Which legal concept completely abolishes the tort system as relates to placing blame for bodily injury caused by auto accidents?
Pure no-fault
The Broad Form Dwelling Policy provides dwelling coverage on which basis?
Replacement Cost
A home with a $200,000 Homeowners Policy has a detached garage that is completely destroyed by a covered peril. How much will the policy pay?
$20,000
The restoration of the insured to the same financial condition as prior to the loss is known as?
Principle of Indemnity
When a property policy is cancelled by the insurer during the policy term, which method of cancellation is used that determines how any return of unearned premium to the insured is handled?
Pro Rata
In Liability Insurance, where are the insured’s responsibilities in event of a loss found?
Conditions
The supplement that provides liability coverage to a Dwelling Policy is called?
Personal Liability Supplement
Which Homeowners Form provides Broad Form Named Peril Coverage on the property of a condominium unit-owner?
HO-6
The value that each party gives other is an insurance contract is said to be the:
Consideration
When a property is empty of both furniture and occupants, it is
Vacant
Alison developed a rash over time because of taking a prescribed medicine. What is this an example of?
Occurrence
Under a DP-1, losses to the dwelling, other structures, and personal property are paid on what basis?
Actual Cash Value
Nathan owns a Homeowners Policy with $100,000 Coverage C limit. How much coverage does Nathan have under Coverage C for his watercraft valued at $10,000 and its trailer valued at $2,500?
$1,500
Who owns a Mutual Insurance Company?
Policyholders
An insurer’s limits of insurance coverage is stated in the?
Declarations
What is it called when damages are reduced in proportion to the degree of negligence?
Comparative
Which coverage under a Dwelling Policy is an indirect loss coverage that covers the fair rental value of property held for rental to others following a direct loss from an insured peril?
Coverage D
Under Section II of a Homeowners Policy, bodily injury and property damage liability are included in which coverage?
Coverage E