Chapter 13 - Commercial Property Insurance
In this quiz, we’ll be learning all about how the process of ensuring commercial property works. Commercial property is defined as any buildings or land which is intended to be used to generate a profit, be it from rental income or capital gain. What do you know about commercial property insurance?
- 1.Which of the following perils are covered in the Causes of LossBasic form?
- A.
Collapse
- B.
Explosion
- C.
Volcanic eruption
- D.
Nuclear hazard
- 2.Under the Earthquake and Volcanic Eruption endorsement, all earthquake shocks or volcanic eruptions that occur within a certain number of hours constitute a single earthquake or volcanic eruption. What is that time period?
- A.
40 hours
- B.
72 hours
- C.
168 hours
- D.
24 hours
- 3.Which Causes of Loss form provides open peril coverage?
- A.
Basic
- B.
Broad
- C.
Special
- D.
Both Basic and Broad
- 4.Loss caused by sprinkler leakage is covered under which Commercial Property Causes of Loss forms?
- A.
Basic
- B.
Broad
- C.
Special
- D.
All of the above
- 5.Which Commercial Property Causes of Loss forms cover collapse?
- A.
Basic
- B.
Broad
- C.
Special
- D.
All of the above
- 6.Which of the following would be covered under the building coverage of the Building and Personal Property coverage form?
- A.
Inventory stored at the insured's warehouse
- B.
An addition to the insured's store on which construction has just begun
- C.
Fire extinguishers located in the insured's factory
- D.
Office furniture and supplies kept in the insured's building.
- 7.The insured's business sustains $25,000 damage in a fire. The fire department that was called to the scene billed the insured $1,000. The business is insured under the Building and Personal Property coverage form for $500,000 with a $5,000 deductible. How much will the insurance company pay for this loss?
- A.
$21,000
- B.
$20,000
- C.
$24,000
- D.
$26,000
- 8.Which of the following properties would not be excluded under the Building and Personal Property coverage form?
- A.
Lawn
- B.
Driveway
- C.
Private company jet
- D.
Animals held for sale
- 9.When are losses under the Building and Personal Property coverage form paid at replacement or repair cost?
- A.
Always
- B.
Never
- C.
If the insured meets the coinsurance requirements and costs are $2,500 or less
- D.
Whenever the total amount of loss does not exceed 25% of the policy limit
- 10.Which of the following have special loss valuation requirements under the Building and Personal Property coverage form?
- A.
Buildings
- B.
Furniture and fixtures
- C.
Glass
- D.
Valuable papers and records
- 11.Which of the following losses would be excluded under the Building and Personal Property coverage form if the insured building had been vacant for more than 60 days before the loss occurred?
- A.
Attempted theft
- B.
Sprinkler leakage when the insured had protected the system against freezing
- C.
Vandalism
- D.
Glass breakage
- 12.Which of the following is covered under the Builders Risk coverage form?
- A.
Building under construction
- B.
Foundation of the building under construction
- C.
Fixtures, machinery, and equipment used to service the building if they will become a permanent part of the building and are located within 100 feet of the building
- D.
All of the above
- 13.Up to what percent of the amount paid for direct loss will the insurance company pay for debris removal expense under the Business and Personal Property coverage form?
- A.
5
- B.
10
- C.
20
- D.
25
- 14.What is the limit on Pollutant Cleanup and Removal coverage under the Business and Personal Property coverage form?
- A.
$10,000
- B.
$20,000
- C.
$25,000
- D.
$50,000
- 15.What is the per-year policy limit for coverage of electronic data under the Business and Personal Property coverage form?
- A.
$1,000
- B.
$2,500
- C.
$5,000
- D.
$7,500
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