204 LA Property and Casualty Test Part 1 Questions and Answers

Exclusions Risks or causes of loss that the insurer decides not to cover Named peril Narrow coverage = few exclusions open peril Wide coverage = many exclusions Exclusions to HO Property Coverage ordinance or law, earth movement, water damage, off premises power failure, neglect, war, nuclear hazard, intentional acts, mechanical breakdown Policy Period coverage only applies to a loss that occurs during the policy period Insurable Interest and Limit of Liability The insurer will not be responsible for payment of loss in an amount greater than the financial interest of an insured. The insurer does not have to pay more than the insured's interest in the covered property at the time of the loos or the applicable limit of liability -this applies even if more than one person has insurable interest in the property Deductible -the insurer will only pay the part of a loss that exceeds the deductible amount stated in the declarations -if there are two or more deductibles under a policy, the highest deductible amount applies Duties after loss - the insured must -Notify the police if the loss may have involved a crime -Notify the insurer about what property was involved, and the circumstances surrounding the loss -Submit a description of how, where, and when loss occurred -Try to prevent further damages, and keep track of expenses incurred doing this -Give the insurer a list of damaged property Concealment or Fraud concealment, misrepresentations, and fraud can void policy coverage Loss Settlement this provision details how different types of property losses are settled. If part of a set or instrumental part of a whole is lost or destroyed, the policy will pay to replace, restore, or repair the set OR pay the difference in the sets actual cash value that was caused by the loss Appraisal if the insurer and the insured disagree on the amount of loss, either party can demand an appraisal of the loss -involves two appraises and one umpire -agreement by both appraisers or by one appraiser and the umpire is binding Other Insurance and Service Agreement This provision specifics how an insurer will pay for losses that are covered by another insurance policy or a service agreement