RMI 4224 Exam 1 questions well
answered to pass
A condition commonly found in commercial property coverage forms: - correct answer ✔✔a pro
rata "other insurance" provision applies when two or more policies cover the same property
What is not an example of Your Business Personal Property? - correct answer ✔✔the building or
structure described in the declarations
Joe owns an appliance repair shop. He just finished repairing a customer's washing machine at a
cost of $125 ($50 for a part and $75 in labor). Before the customer could pickup their repaired
washing machine, a fire swept through Joe's shop and destroyed the washing machine. The
washing machine was worth $500 at the time of this loss. How much money is Joe entitled to
collect for this u=loss under his B&PP? - correct answer ✔✔$125
Why are bridges, roadways, walks, patios, foundations, pilings and piers typically deemed
Property Not Covered under the b&PP? - correct answer ✔✔they have a low susceptibility to
covered causes of loss & most insureds don't want the values of such items considered in
determining compliance with the policy's coinsurance clause
The additional coverage for preservation of property provides coverage for covered proerty
removed from the covered premises to avoid being damaged by a covered cause of loss. How
many days from the time the property was moved does this coverage extend? - correct answer
✔✔30 days
T/F according to the coverage extension under the coverage form: Up to $1,000 can be paid for
a loss or damag of a satellite dish due to fire - correct answer ✔✔True
, statement concerning coverage for Fire Department Service Charges: This coverage is treated as
additional insurance and not subject to the limit of insurance specified in the Declarations -
correct answer ✔✔True
The process available to an insured and their insurance company to resolve disputes concerning
the valuation of lost or damaged property is: - correct answer ✔✔appraisal
Duties of an insured in the event of a covered loss: - correct answer ✔✔-protect covered
property from further damage
-cooperate with insurance company's investigation of the loss
-provide prompt notice of loss to the insurance company
A building is valued at $250,000 and insured for its full value. A fire completely destroys this
building and the insured is paid $250,000 for the destroyed building. The cost to remove the
debris is $40,000. What amount, if any, can be paid to the insured for the cost of debris
removal? - correct answer ✔✔$250,000
Hazard - correct answer ✔✔-condition increasing probability and severity of a loss
-building a home in a remote, arid area increases the probability of a loss due to wildfires. In
this example, the decision to build in this area is the hazard that leads to a greater probability of
loss due to wildfires.
-hazard is not synonymous with peril
Joe doesn't want the liability associated with over-serving patrons alcohol. He sells the bar to
another person. What risk management technique is Joe using? - correct answer ✔✔Avoidance
Legally binding contract includes: - correct answer ✔✔offer/acceptance, competent parties,
legal purpose, legal consideration
answered to pass
A condition commonly found in commercial property coverage forms: - correct answer ✔✔a pro
rata "other insurance" provision applies when two or more policies cover the same property
What is not an example of Your Business Personal Property? - correct answer ✔✔the building or
structure described in the declarations
Joe owns an appliance repair shop. He just finished repairing a customer's washing machine at a
cost of $125 ($50 for a part and $75 in labor). Before the customer could pickup their repaired
washing machine, a fire swept through Joe's shop and destroyed the washing machine. The
washing machine was worth $500 at the time of this loss. How much money is Joe entitled to
collect for this u=loss under his B&PP? - correct answer ✔✔$125
Why are bridges, roadways, walks, patios, foundations, pilings and piers typically deemed
Property Not Covered under the b&PP? - correct answer ✔✔they have a low susceptibility to
covered causes of loss & most insureds don't want the values of such items considered in
determining compliance with the policy's coinsurance clause
The additional coverage for preservation of property provides coverage for covered proerty
removed from the covered premises to avoid being damaged by a covered cause of loss. How
many days from the time the property was moved does this coverage extend? - correct answer
✔✔30 days
T/F according to the coverage extension under the coverage form: Up to $1,000 can be paid for
a loss or damag of a satellite dish due to fire - correct answer ✔✔True
, statement concerning coverage for Fire Department Service Charges: This coverage is treated as
additional insurance and not subject to the limit of insurance specified in the Declarations -
correct answer ✔✔True
The process available to an insured and their insurance company to resolve disputes concerning
the valuation of lost or damaged property is: - correct answer ✔✔appraisal
Duties of an insured in the event of a covered loss: - correct answer ✔✔-protect covered
property from further damage
-cooperate with insurance company's investigation of the loss
-provide prompt notice of loss to the insurance company
A building is valued at $250,000 and insured for its full value. A fire completely destroys this
building and the insured is paid $250,000 for the destroyed building. The cost to remove the
debris is $40,000. What amount, if any, can be paid to the insured for the cost of debris
removal? - correct answer ✔✔$250,000
Hazard - correct answer ✔✔-condition increasing probability and severity of a loss
-building a home in a remote, arid area increases the probability of a loss due to wildfires. In
this example, the decision to build in this area is the hazard that leads to a greater probability of
loss due to wildfires.
-hazard is not synonymous with peril
Joe doesn't want the liability associated with over-serving patrons alcohol. He sells the bar to
another person. What risk management technique is Joe using? - correct answer ✔✔Avoidance
Legally binding contract includes: - correct answer ✔✔offer/acceptance, competent parties,
legal purpose, legal consideration
