P&C Property Insurance Policies 2

Question 1

Which of the following commercial property coverage forms provides the broadest protection, covering all risks of physical loss except those specifically excluded?

Accepted Answer

Special Cause of Loss Form

Answer

Basic Cause of Loss Form

Answer

Broad Cause of Loss Form

Answer

Named Perils Form

Question 2

Under an inland marine insurance policy, which of the following would typically be covered?

Accepted Answer

A contractor's equipment and tools at various job sites

Answer

Ocean cargo on an international vessel

Answer

A commercial building's fixed structure

Answer

Workers compensation claims for maritime workers

Question 3

Under a commercial property policy, 'business personal property' (BPP) coverage includes:

Accepted Answer

Furniture, equipment, inventory, and other personal property owned by the insured and used in the business

Answer

The insured's building and its permanent fixtures

Answer

Employee-owned property brought to the workplace

Answer

Land under the building

Question 4

A 'valued policy' in property insurance means:

Accepted Answer

A pre-agreed value is stated in the policy, and that amount is paid in full if a total loss occurs, without depreciation or proof of value

Answer

The insurer determines the value of covered property at the time of loss

Answer

The insured must prove the market value of the property each year

Answer

The policy covers only the actual cash value of the property

Question 5

The 'coinsurance clause' in a commercial property policy is triggered when:

Accepted Answer

The insured carries less than the required percentage (typically 80%) of the property's replacement cost, resulting in a reduced claim payment for partial losses

Answer

The insured carries more insurance than the property's replacement cost

Answer

The insured files more than one claim in a policy period

Answer

The insured does not have a separate liability policy

Question 6

Under a commercial property policy, which of the following losses would typically be excluded under the 'flood' exclusion?

Accepted Answer

Surface water from a nearby river overflowing and entering the building

Answer

A burst pipe inside the building

Answer

A roof leak caused by heavy rain

Answer

A sprinkler system malfunction