State Farm Property

State Farm Property In property insurance actual cash value is defined as which of the following Ans- Replacement cost at the time of the loss, less depreciation Peril is most easily defined as Ans- the cause of loss insured against What is a leading factor in the determination of actual cash value Ans- replacement cost Replacement cost is defined as Ans- full replacement of property at its current cost, new and without reduction for depreciation Property insurance that provides 100k coverage for a building and 50k coverage for personal property at a single location is called Ans- Specific coverage Which of the following is used in the formula for calculating the actual cash value of a property Ansreplacement cost What is the purpose of the coinsurance clause found in property insurance policies? Ans- Encourage the insured to insure the property closer to its full value An insured has a liability policy that sets the amount at 50k for all claims that arise from a single incident. which type of limit of liability does this insured's policy have? Ans- per occurrence When the amount of insurance written in a property policy is not subject to any coinsurance provision and that amount is paid in the event of a covered loss, the coverage is said to be written as Ans- stated amount What is stated amount coverage Ans- In stated amt coverage the value of the insured property is determined at the time the policy is written. in the event of a loss, that amount is paid without regard to any coinsurance provision. However, if the loss is less than the total, the insurer has salvage rights with the insured having first right of refusal of the salvage. What type of liability would a person who owns a swimming pool have? Ans- Absolute What is absolute liability Ans- Any conduct that is inherently dangerous imposes absolute liability. the claimant does not have to prove anything Insurable interest in the property covered in a policy must be proven Ans- at the time of loss Which of the following is NOT an element of negligence breach, unbroken chain, libel, duty Ans- libel what is libel Ans- a type of intentional tort With respect to the business of insurance, a hazard is Ans- any condition or exposure that increases the possibility of loss What are the four essential elements of all legal contracts Ans- offer and acceptance, consideration, competent parties, and legal purpose In forming an insurance contract, when does acceptance usually occur? Ans- when an insurer's underwriter approves coverage Who is responsible for filling out a notice of claim form Ans- insured what is a notice of claim Ans- a form or statement from an insured to an insurer, informing the insurer that events leading to a possible claim have occurred If a property is covered by comp a for 20k and comp b covers the same property for 40k, how much will comp a pay on a 24k loss? Ans- 8000 pro rata liability applies each policy pays a percentage of the loss based on the percentage of coverage that policy provides. comp a carries 1/3 of the total coverage (20k + 40k = 60k) Therefore 1/3 of the 24k loss is 8,000 In the event of a loss covered by the policy, if the insurer requests a signed sworn proof of loss, the named insured is required to submit it within Ans- a specified time What are considered parts of the policy structure Ans- conditions, exclusions, insuring clause A homeowner sells his house to a friend. the friend wants to keep the homeowners current policy in effect. under the assignment provision which of the following is most likely? Ans- the homeowner will need to get written consent from the insurer before the policy can be reassigned What is consideration? Ans- something of value that is transferred between the two parties to form a legal contract What are endorsements Ans- change the policy's original terms, conditions, or coverages. endorsements can add or delete coverage or merely correct items such as the insured's name and address etc Termination of an inforce insurance policy prior to the expiration date shown in the policy is known as Ans- cancellation When would a misrepresentation on the insurance app be considered fraud? Ans- if it is intentional and material What is true about single dwellings that are insured to at least 80% of the replacement value Ans- they are automatically provided with replacement cost coverage If more than one person has an insurable interest in the property covered under a dwelling policy AnsThe insurer will be liable for only the insured's interest in the damaged property Johanna purchased a national flood insurance policy 10 days after her community entered an emergency program. when would her coverage be effective? Ans- 1201 am the day after the application and premium payment are mailed a commercial property special form covers property in transit up